In the late sixteenth century, the Ottoman Empire was hit by an economic crisis precipitated by a massive devaluation and resultant inflation. As the historian Dan Diner tells the story in his new book “Lost in the Sacred,” in order to reassure the people (and, above all, the army) that he had matters under control, Sultan Murad III “saw no other way to guarantee his authority than by sacrificing the official in charge of the mint…as well as the head of the state treasury.”

Of course, “sacrificing” back then was not really a metaphorical term. The head of the mint and the state treasurer were not fired. They were executed. Which is certainly one way to deal with the threat of moral hazard.