English financier, namesake of "bad money drives out good"
A sixteenth-century English financier and royal financial agent, financial adviser to Elizabeth I. He keenly observed a monetary law: when full-weight "good money" and clipped, debased "bad money" circulate together while the state decrees them equal in value, people hoard the good and spend the bad, until the good money leaves circulation — the law later named for him, "Gresham’s law" (bad money drives out good). He also founded the Royal Exchange in London, laying a foundation for England’s later rise as the world’s financial center.
Gresham found that if a full-value gold coin and a clipped, debased one are decreed "equal in face value," the clever will hoard or melt the good coin and spend only the bad. The result: only bad money circulates. This law of "bad money drives out good" describes not only currency, but was later borrowed to describe the universal phenomenon, in every field, of the inferior crowding out the superior.
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