======The Wizarding Economy======
=====Overview=====
The wizarding economy is the system of production, trade, and consumption of magical goods and services within the magical community. It functions as a largely self-contained system, operating parallel to but mostly separate from the non-magical or [[Muggle]] world, a separation enforced by the [[International Statute of Secrecy]]. The economy is characterized by its unique precious metal-based currency, a central banking institution run by [[Goblins]], and specialized industries that cater to the needs of witches and wizards. Key commercial activity is concentrated in specific magical locations like [[Diagon Alley]] and [[Hogsmeade]].
=====Currency and Banking=====
The financial system of the British wizarding world revolves around a single bank, [[Gringotts]], and a non-decimal currency system.
  * **Wizarding Currency**
    The currency consists of three types of coins:
    * **[[Galleon]]**: The most valuable coin, made of gold.
    * **[[Sickle]]**: The intermediate coin, made of silver.
    * **[[Knut]]**: The least valuable coin, made of bronze.
    The exchange rates are fixed:
    * 1 [[Galleon]] = 17 Silver [[Sickle]]s
    * 1 [[Sickle]] = 29 Bronze [[Knut]]s
    * Therefore, 1 [[Galleon]] = 493 [[Knut]]s
    Each coin is imprinted with a serial number that identifies the specific [[Goblin]] responsible for minting it. Counterfeit currency, such as [[Leprechaun]] gold, exists but is magically enchanted to vanish after a short time.
  * **Banking**
    [[Gringotts Wizarding Bank]] is the primary financial institution for witches and wizards in [[Great Britain]]. Managed and staffed by [[Goblins]], it is considered one of the safest places in the magical world, second only to [[Hogwarts School of Witchcraft and Wizardry]]. Its services include:
    * **Vaults:** [[Gringotts]] provides secure vaults for families and individuals to store their money and valuables. The security of these vaults varies, from simple keys for basic vaults to complex magical enchantments and even [[Dragon]] guardians for high-security vaults, such as the [[Lestrange Vault]].
    * **Currency Exchange:** The bank provides a service for exchanging [[Muggle]] money into wizarding currency, which is essential for [[Muggle-born]] witches and wizards like [[Hermione Granger]] and their families.
=====Commerce and Industry=====
Trade in the wizarding world is robust, with dedicated commercial districts and specialized industries.
  * **Retail and Trade**
    The main commercial hub in London is [[Diagon Alley]], accessible through [[The Leaky Cauldron]]. It contains a wide array of shops, including:
    * [[Ollivanders]]: A renowned maker of fine [[wand]]s.
    * [[Flourish and Blotts]]: The primary [[book]]seller for [[Hogwarts]] students.
    * [[Madam Malkin's Robes for All Occasions]]: A supplier of [[Hogwarts]] uniforms and other [[robe]]s.
    * [[Slug and Jiggers Apothecary]]: A seller of [[Potion]] ingredients.
    * [[Eeylops Owl Emporium]]: A seller of [[owl]]s and other magical pets.
    For older students and the wider wizarding community, the village of [[Hogsmeade]] offers additional shops and pubs, such as [[Honeydukes]], [[Zonko's Joke Shop]], and [[The Three Broomsticks]]. A darker side of commerce exists in [[Knockturn Alley]], where vendors like [[Borgin and Burkes]] trade in [[Dark Arts]] artifacts.
  * **Industry**
    Several key industries support the wizarding way of life:
    * **Broomstick Manufacturing:** A competitive industry with multiple companies like the [[Nimbus Racing Broom Company]], [[Cleansweep Broom Company]], and the producers of the world-class [[Firebolt]].
    * **Publishing:** [[The Daily Prophet]] is the main newspaper, while various publishers like [[Obscurus Books]] produce textbooks and other literature. Smaller, independent publications like [[The Quibbler]] also exist.
    * **Wandmaking:** A highly specialized craft practiced by masters like [[Garrick Ollivander]] and [[Mykew Gregorovitch|Gregorovitch]].
    * **Other Industries:** These include [[Cauldron]] manufacturing, the breeding of magical [[creatures]], and the cultivation of magical [[plant]]s for [[Potion]]-making.
=====Labour and Employment=====
The largest single known employer in the British wizarding world is the [[Ministry of Magic]], which employs thousands of witches and wizards in various departments. Other significant employers include [[Hogwarts School of Witchcraft and Wizardry]] and [[St. Mungo's Hospital for Magical Maladies and Injuries]].
Notable professions include:
  * [[Auror]]
  * [[Healer]]
  * Professor
  * [[Curse-Breaker]] for [[Gringotts]]
  * [[Dragon]] Keeper
  * Magizoologist
  * Shopkeeper
  * Wandmaker
Specific wages are rarely mentioned, but [[Dobby]] the [[house-elf]] successfully negotiated a salary of one [[Galleon]] a week from [[Albus Dumbledore]], a wage considered generous for his kind. Significant sums of money can also be won, such as the 700-[[Galleon]] Grand Prize from the [[Daily Prophet]] Galleon Draw won by the [[Weasley]] family, or the 1,000-[[Galleon]] prize for winning the [[Triwizard Tournament]].
=====Wealth and Social Class=====
There is a clear and significant wealth disparity within the wizarding world. This often, but not always, aligns with blood status.
  * **Old Money:** Ancient [[pure-blood]] families, such as the [[Malfoy]] family and the [[House of Black|Black family]], possess vast fortunes passed down through generations. This wealth is stored in high-security [[Gringotts]] vaults and affords them considerable influence and social standing.
  * **Working Class:** Families like the [[Weasley]]s are depicted as having great magical heritage but very little money. Their [[Gringotts]] vault contains only a small pile of [[Sickle]]s and a single [[Galleon]], and they rely heavily on second-hand goods.
  * **New Money:** Wealth is not exclusively inherited. [[Harry Potter]] inherited a substantial fortune from his parents, [[James Potter|James]] and [[Lily Potter]], which gave him financial independence from the [[Dursley]]s.
  * **Poverty:** Some ancient lines, like the [[Gaunt]] family, fell into extreme poverty and squalor despite their prestigious ancestry, demonstrating that wealth and status can be lost over time.
=====Interaction with the Muggle Economy=====
Due to the [[International Statute of Secrecy]], the wizarding economy is highly insular. However, limited and necessary interactions with the [[Muggle]] world do occur.
  * **Currency Exchange:** As [[Gringotts]] provides a [[Muggle]]-to-wizarding currency exchange, it is clear that a formal system is in place to manage the flow of money between the two worlds.
  * **Need for Muggle Money:** Witches and wizards require [[Muggle]] currency when operating in non-magical areas. For example, [[Arthur Weasley]] had to exchange money to pay a [[Muggle]] campsite manager for their pitch at the [[Quidditch World Cup]].
  * **Use of Muggle Goods:** Some [[Muggle]]-made products are used and often magically altered by wizards. This includes vehicles like the [[Ford Anglia]] modified by [[Arthur Weasley]] and the [[Hogwarts Express]] steam engine.
=====Behind the Scenes=====
  * J.K. Rowling stated in an interview that she estimated the value of one [[Galleon]] to be "about five British pounds, though the exchange rate would vary" (J.K. Rowling interview).
  * The peculiar, non-decimal nature of the currency (17 and 29) was a deliberate world-building choice to contrast the wizarding world with the more logical [[Muggle]] world and to evoke the historical, pre-decimal British monetary system (£sd).