In the U.S. today, the penny as we know it costs 1.8 cents to produce. Due to inflation, it is generally thought of as an expensive burden by merchants, banks, mints and consumers. 

Currently, it is only composed of 2.5 percent copper, whereas copper comprises most of the metal used in the production of nickels, dimes and quarters.

Stemming from the French “denier,” the German “pfenning” and the Swedish “penning,” the penny originally referred to any coin. The word “penny” dates to a 1394 Scots text as a variant of the word “peni,” and variations of “penning,” pennig” and “pending” have also been known. Other suggestions are “panding,” “pawn” and “pfant” from Old High German, and “ponding,” from the Latin “pondas” or “pound.”

In the 16th century, the English referred to twopence, threepence, etc. for costing, but referred to pennies as individual coins. Farthings (1/4 of a penny) and half cents have also been minted, and in some locales the “mill” (1/10 of a cent) is still in use. 

During medieval times, the silver penny was modeled on antique coins, such as the Greek drachma, the Carthaginian shekel, and the Roman denarius. 

The use of Roman coins in Britain ebbed during the Anglo-Saxon invasions.

Around 755 A.D., Pepin the Short instituted currency reform in the Frankish empire, replacing Francia’s silver standard with an 0.940 fine denier that weighed 1/240th of a pound. Around 790 A.D., Charlemagne introduced an 0.960 fine penny weighing 1.70 grams. These were rejected by traders, who preferred the gold coins used elsewhere. 

During the same timeframe, Offa, an Anglo-Saxon king, introduced the penny, which was also made of 0.940 fine silver, and this remained as the principal currency in Europe for several centuries. The coins minted under King Offa were modeled after Charlemagne’s pennies, and they were fractions of shillings and pounds. The larger denominations were used only in reference to the amount of grain that X number of pennies could purchase.

In Britain under Henry II, currency was 0.925 fine sterling silver. In 1257, Henry III minted a gold coin worth 1 shilling 8 pence. 

By 1265, gold’s value was higher than the face value of the coins, and widespread melting resulted. Only eight gold pennies survived. The earliest farthing and halfpenny originated then, and it was common to make small change by cutting coins in halves and quarters. 

In 1527, Henry VIII established a new pennyweight of 1.56 grams. The last silver pence in circulation was during Charles II’s reign around 1660. 

In 1797 the Napoleonic Wars prompted the use of base metals in coin manufacturing, and eventually merchants and mining companies issued copper tokens. 

In 1860 copper pennies were replaced with a bronze version composed of 95 percent copper,  4 percent tin and 1 percent zinc.

In the U.S. the “Fugio” cent, designed by Ben Franklin, was struck in 1787 by a private mint. It was 100 percent copper, supplied in part by Paul Revere. A sundial was depicted with the word ”Fugio,” which means ”I fly,” and the words “Mind your own Business.” The 13 links on the reverse, representing the unity of the 13 colonies, drew criticism by some for its connotation of slavery. 

The U.S. Mint produced the one-cent coin in 1793. The coins were called large cents, as they were 50 percent larger than the current coin. They pictured a Liberty maiden with long flowing hair, and there were 15 links on the reverse representing the 15 states. Due to poor spacing, the word “Ameri” was cast. 

These coins are highly prized, as they are considered to be the first coin struck by the federal government. 

After 36,103 were minted, the design changed from links to a wreath, and in varying redesigns, they were minted until July 1793. From that time until 1796 the depiction showed Liberty wearing a Phrygian cap on her head, representing an item worn by freed slaves of ancient times. 

In 1795 the thickness was reduced, and the legal weight was reduced to 168 grams. 

1796-1807 saw the “Draped Bust” cent modeled after a drawing by artist Gilbert Stuart. It showed Liberty with flowing hair and a ribbon, with a draped bust. The reverse shows two branches of an open olive wreath cast in varying designs in 1794,1795 and 1797. Sixteen million were cast between 1796 and 1807.

In 1808, an improvement in die steel allowed for 300,000 impressions per die. However, the copper that was used was softer and thus the purity was impacted, causing a lack of clarity. The motif of the classic head saw a left-facing Liberty with curly hair amid 13 stars, and the reverse had a continuous wreath. There was a shortage of copper in 1809, and in 1815—due to the War of 1812 with Britain—there were no one-cent coins minted. This was the only year that the penny was not made.

Due to criticism, there was a new design in 1816—a “Coronet Head” cent, known as the “Matron Head.” 51,706 were minted in Philadelphia. In 1839, a steam-powered coin press came into use, and from that year until 1857, the “Braided Hair” design was cast, which modified the style. 

Large copper cents were discontinued in 1857, due to expense and cumbersomeness. The Mint Act of that year abolished the half-cent and ended the large copper cent. New pennies were cast, made of 12 percent nickel and 88 percent copper, which looked brighter, and were dubbed “white cents” or “nicks.” There was a flying eagle on one side and a wreath on the other, a motif adapted from a silver-dollar design 20 years prior. 

People flocked to banks to trade in their coins, and profiteers proliferated. Interest in the Flying Eagle penny spurred coin collecting, and the old large coins shrunk from circulation.

In 1859, a simple “Indian Head” design was produced with a laurel wreath on the reverse. In 1860, it became an oak wreath with three arrows. Until 1864, it was composed of 88 percent copper and 12 percent nickel. War-related hoarding caused a change to 95 percent copper and 5 percent zinc. The weight of 48 grams was similar to today’s version.

In 1909, the “Lincoln Wheat” cent replaced the “Indian Head;” it commemorated Abraham Lincoln’s100th birthday. (Theodore Roosevelt, who was president, considered Lincoln to be the savior of our country.) 

The designer hired was Victor David Brenner, a Lithuanian immigrant who engraved his initials VDB on the reverse beneath the sheaves of wheat.  Due to public outcry that it was “tasteless self-advertising,” the initials were quickly removed. With only 484,000 minted in San Francisco, the “Lincoln S–VDB” is one of the rarest and most coveted coins. 

Demand for the “Lincoln Wheat” was so high that it was being sold for greater than face value by young boy entrepreneurs for weeks after its release. This design was minted until 1958.

In 1943, copper was removed from the penny due to the need for the ore in munitions during WWII. Zinc-coated steel cents were made for the only time in history, and copper returned to the penny in 1944. These “steelies” rusted and became spotted and stained due to electromagnetic coupling, which occurred by the contact of zinc and iron in a damp atmosphere.

In 1959, to mark the 150th birthday of Lincoln and the 50th anniversary of the Lincoln cent, the penny was redesigned to depict the Lincoln Memorial. It was announced to the public on December 21, 1958 by President Eisenhower. The coin was released on February 12, 1959, and was composed of 95 percent copper and 5 percent tin and zinc. 

To cope with the rise in the cost of copper and subsequent hoarding, the aluminum cent was produced at the end of 1973, and was dated 1974. Lobbyists from the vending-machine industry testified that the coins would jam their machines, and the pennies were withdrawn and melted down. Samples had been doled out to congressmen; one was donated to the Smithsonian, and 14 are missing. 

In 1982, the price of copper led to a new mix: zinc core and thin copper plating, which is the current composition of only 2.5 percent copper.

On February 11, 2010, to celebrate the 201st anniversary of Lincoln’s birth, a new version was released. A Union shield was engraved on the reverse side, which featured 13 stripes joined by a horizontal bar, representing the original states joined in support of the federal government. This is the coin in use today.

In 2017, and then only, the Philadelphia mint stamped a “P” beneath the date to honor the mint’s 225th anniversary.

Changes in market prices of metals and inflation have caused the metal value of the penny to exceed face value. Australia and Canada have adopted 5 cents as their lowest coin denomination, and in New Zealand, it is 10 cents. In the 1980s U.S. military bases overseas abolished the penny and rounded all transactions to the nearest 5 cents. 

In British and American culture, finding a penny is generally thought of as lucky: “Find a penny, pick it up, and all the day you’ll have good luck.” 

Sources for this story: Wikipedia.org, history.com, and moderncoinmart.com.