Gresham law works only when the exchange between the good/bad money is fixed. Usually by a government/sovereign decree.
Otherwise quite the opposite is observed in real world. There's even a word for it. Dollarization.
Otherwise quite the opposite is observed in real world. There's even a word for it. Dollarization.
> They also focused mainly on the interaction between different metallic monies, comparing the relative "goodness" of silver to that of gold, which is not what Gresham was speaking of.
(from the wikipedia article)