As we have seen, "Gresham's Law"—that an artificially overvalued money tends to drive an artificially undervalued money out of circulation—is an example of the general consequences of price control. The government places, in effect, a maximum price on one type of money in terms of the other. Maximum price causes a shortage—disappearance into hoards or exports—of the currency suffering the maximum price (artificially undervalued) and leads it to be replaced in circulation by the overpriced money.

We have seen how this works in the case of new vs. worn coins, one of the earliest examples of Gresham's Law. Changing the meaning of money from weight to mere tale, and standardizing denominations for their own rather than for the public's convenience, the governments called new and worn coins by the same name, even though they were of different weight. As a result, people hoarded or exported the full weight new coins, and passed the worn coins in circulation, with governments hurling maledictions at "speculators," foreigners, or the free market in general, for a condition brought about by the government itself.