There is a long-standing debate as to whether the Fisher effect operated during the classical gold
standard period. We break new ground on this question by developing a market-based measure of
inflation expectations during the gold standard. We derive a measure of silver-gold inflation
expectations using the interest-rate differential between Austrian silver and gold perpetuity bonds.
Our use of the silver-gold interest rate differential is motivated by the fact that both gold and
silver served as numeraires in the pre-WWI period, so that a change in the price of either precious
metal would impact the prices of all goods and services. The empirical evidence suggests that
silver-gold inflation expectations exhibited significant persistence at the weekly, monthly, and
annual frequencies. Further, we find that there is a one-to-one relationship between silver-gold
inflation expectations and the interest rate on Austrian perpetuity bonds that were denominated in
paper currency. The analysis suggests the operation of a Fisher effect during the classical gold
standard period