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What was the gold standard?

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Quick answer

The gold standard was a monetary system where a country's money was directly backed by gold, and could be exchanged for a fixed amount of it. It limited how much money governments could print, but most nations abandoned it in the 20th century.

Key things to understand

  1. Currency was backed by, and convertible to, gold.
  2. It fixed the value of money to a set amount of gold.
  3. It limited how much money a government could create.
  4. Most countries abandoned it during the 20th century.

People also ask

What was the gold standard?
A system where money was backed by gold and could be exchanged for a fixed amount of it.
Why did countries abandon the gold standard?
It limited flexibility to respond to crises, so nations moved to currencies not tied to gold.
What replaced the gold standard?
Fiat money — currency whose value comes from government backing and trust, not a physical commodity.