The US is soon going to stop minting the 1 dollar coins that nobody tends to really like.
Its about time. The United states recently put in 650,000 to build another vault to just hold the 1 dollar presidential coins that people dont prefer.
But rather than stopping them completely, there are other things that the government could try to do to help build up the popularity of 1 dollar coins, if we already have them produced. By directly increasing the demand, it is possible that we can save these one dollar coins.
One method they could use is to try to increase the popularity of complementary goods, in a way. As of now, very few vending machines accept these dollar coins. If vending machines had slots for the dollar coins, its possible that the popularity of the dollar coins would go up. Dollar bills are also viewed as having a higher value than coins. The creation of more classy coin pouches or coin wallets could help in the decrease of this viewpoint.
Another option the government does have is to force everyone to switch from the use of dollar bills to dollar coins, or offer more incentive for the dollar coins than the dollar bills.
We also have to look at the opportunity cost of the coins. The coins cost significantly more than the dollar bills to make, and circulate slower, which means that we have to create more of them for the same amount of time. Though the latter could be changed, the costs of switching over to the coin do seem to outweigh the benefits.
As now, dollar coins just aren't popular enough yet to survive, and it doesnt look like they will be getting popular by themselves. The economical cost of the coins just dont live up to the standard either.
Source: http://abcnews.go.com/blogs/politics/2011/12/u-s-suspends-production-of-presidential-1-coins/
http://www.nytimes.com/2011/11/06/us/some-seek-to-replace-the-dollar-bill-with-the-dollar-coin.html
Its about time. The United states recently put in 650,000 to build another vault to just hold the 1 dollar presidential coins that people dont prefer.
But rather than stopping them completely, there are other things that the government could try to do to help build up the popularity of 1 dollar coins, if we already have them produced. By directly increasing the demand, it is possible that we can save these one dollar coins.
One method they could use is to try to increase the popularity of complementary goods, in a way. As of now, very few vending machines accept these dollar coins. If vending machines had slots for the dollar coins, its possible that the popularity of the dollar coins would go up. Dollar bills are also viewed as having a higher value than coins. The creation of more classy coin pouches or coin wallets could help in the decrease of this viewpoint.
Another option the government does have is to force everyone to switch from the use of dollar bills to dollar coins, or offer more incentive for the dollar coins than the dollar bills.
We also have to look at the opportunity cost of the coins. The coins cost significantly more than the dollar bills to make, and circulate slower, which means that we have to create more of them for the same amount of time. Though the latter could be changed, the costs of switching over to the coin do seem to outweigh the benefits.
As now, dollar coins just aren't popular enough yet to survive, and it doesnt look like they will be getting popular by themselves. The economical cost of the coins just dont live up to the standard either.
Source: http://abcnews.go.com/blogs/politics/2011/12/u-s-suspends-production-of-presidential-1-coins/
http://www.nytimes.com/2011/11/06/us/some-seek-to-replace-the-dollar-bill-with-the-dollar-coin.html
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