1861

We apply the outlier methodology to the issue of the regulation of Bimetallism. Did French and British central banks use their discount rates as a policy tool for currency stabilization over the period 1850-1870? The common view identifies Bimetallism as a pure automatic system constrained by specie points. Using outliers methodology we give evidence that the influence of the discount rate differential between France and England on the Sterling-Franc spot exchange rate was taken in default only on one occasion, on February 1861. The assessment of the historical context helps to understand this peculiar event which was only transitory. This article is an illustration of the importance of the outlier methodology in cliometrics as a mean to test conventional wisdom in economic history.