Decimal, Decimalization. Coin denominations and monetary units based on a scale of ten, and the conversion to a coinage system based on ten. The concept of weights, measures and money based on tens originated in France (although it had roots in Chinese antiquity) and is best exhibited by the metric system. It was purposed for money units as well, but not immediately accepted into practice by France. American patriots Benjamin Franklin, Alexander Hamilton and Thomas Jefferson read of this French innovation and adopted the idea for monetary use in America. Jefferson introduced this into legislation in the Continental Congress, April 1784, with his "Notes on the Establishment of a Money Unit, and of a Coinage for the United States."

With the cooperation of David Rittenhouse, first Director of the Mint, America embraced this system by establishing a decimal money system (see box) with the first coins struck in 1792. It was two years ahead of France that, indeed, adopted a similar decimal system in 1794 following the French Revolution. The use of the American terms – cent, dime, dollar – were solidified when Noah Webster placed these words in his first American dictionary, 1806.

Decimal coin divisions can easily convert to a higher or lower unit by moving the decimal point (cents to dollar, two places to the left, for example). This method is in contrast to a duality system based on two; where each division is half of the higher unit (or twice the lower unit) in an elaborate system of halves, fourths, eights, sixteenths, thirty-seconds, sixty-fourths, and such. The Spanish Piece-of-Eight was a coin denomination based on the duality system.

Stock prices in America were formerly quoted in such a duality system of fractions (until it too went decimal 29 January 2001 after a three-year plan to ease the conversion). In theory, we may think better in a duality system (for a few divisions only), but figure accounts better in a decimal system.

Other monetary systems exist, like the former British system (see box), in force until they converted to a new decimal system beginning in 1968. In effect every modern coinage system in the world was patterned after the decimal system first implemented in the United States based on the French proposal.

British Monetary System

4 Farthings = 1 Penny

12 Pence = 1 Shilling

2 Shillings = 1 Florin

5 Shillings = 1 Crown

21 Shillings = 1 Guinea

British Decimal System

100 New Pence = 1 Pound

Thomas Jefferson's Scheme

For a U.S. Decimal Monetary System

Unite $100.00

Eagle $10.00

Dollar $1.00

Dime $ .10

Cent $ .01

Mill $ .001

References:

NM42 {1983} Doty, p 90-91.

NE43 {1984} Junge, p 82.