If Wake Forest economist Robert Whaples has piqued your interest with his ongoing participation in debate about the future of the one-cent piece, you might appreciate this blurb from the latest Money magazine.
Canada is dropping the use of its penny today. And some economists believe the United States should be following its neighbor’s example.
The U.S. Mint spent 2 cents to produce and ship each of the 5.8 billion pennies sent to banks last year. But in addition to being a money loser for the Treasury, there are arguments that the penny has simply outlived its usefulness.
Greg Mankiw, Chairman of the President’s Council of Economic Advisers under President Bush, said American consumers have shown they don’t value the penny, even if most polls show opposition to getting rid of the coin.
“When people start leaving a monetary unit at the cash register for the next customer, the unit is too small to be useful,” he said.
