Chapter 56: Perils Of Popularity

''Compared to the drama of dragon-dug underground canals and dragon-forged skyscrapers, the Financial Revolution in the century and a half after Hiccup Haddock's taming of dragons is generally overlooked, but is perhaps even more fundamental to an understanding of the economic structure he left behind. Prior to the taming of dragons, bullion currency was comparatively rare; while gold and silver coins were certainly in circulation, as witnessed by the famous bride price paid for Hiccup's wife Astrid, overall, the Europan economy was cash-starved and functioned primarily on the barter economy at the lower levels. After the taming of dragons, however, an even more scarce commodity currency entered the economy in the form of dragon scales. ''

''As is common knowledge, dragons shed their skins each spring; prior to domestication, they used these materials for the construction of nests for newly hatched young. Under human auspices, however, the shedding amounted to the annual input of pure currency into the economy. Properly treated and cured, dragon leather and dragon scales can last for decades of use before wearing out. While the leather itself acted as a trade commodity, the single scales from hide that wasn't of sufficient quality to be made into leather were not worthless. On the contrary, they functioned as currency, quickly displacing bullion metals as the currency material of choice.''

''In this role, dragon scales offered numerous advantages, including being nearly impossible to counterfeit or debase, being easy to substantiate as genuine, and naturally removing themselves from the money supply over time as they wore out or were repurposed (such as for industrial use, decoration or even insulation). However, even with this removal, the most productive gold or silver mine could not hope to match the net output of dragon shedding, and the resulting injection of funds into Europa's economy—spread by the effects of the Dragon Mail and the existing trade network—caused rampant inflation, averaging between 3-8% a year over the next century. While this would cause problems to the modern developed economy, in the cash-starved environment at the time, it was an economic blessing, allowing for a rapid shift from the barter economy and feudal taxation system to a market economy and currency taxation system, giving even the peasantry access to funds with which to pay their expenses and taxes and receive payments. Increasing per-person productivity from Haddock's innovations and the agricultural impact of dragon labor pushed urbanization, as demand for labor—human and dragon alike—exceeded the available number of hands and wings for most of the next several centuries…''

—The Dragon Millennium, Manna-hata University Press, Ltd.

Foreshadowing
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Epigraph Tie-In

 * The epigraph mentions that the annual injection of dragon scales into the economy caused inflation, devaluing the scales. The chapter shows the Alban nobles being informed that on Berk, dragon scales are plentiful and the Hooligans are willing to part with them for less than in other places.

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