Gresham’s Law Law and Legal Definition

Gresham’s law refers to an economic principle that is applied when inferior products or practices tend to displace superior ones. Gresham’s law takes its name from Sir Thomas Gresham. The principle of Gresham's law can sometimes be applied to different fields of study. Gresham's law may be generally applied to any circumstance in which the true value of something is markedly different from the value people are required to accept. This maybe due to factors such as lack of information or governmental decree. Gresham’s law is commonly stated as “bad money drives out good money”.[People v. Brown, 46 Cal. 3d 432, 476 (Cal. 1988)]