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+The Project Gutenberg eBook, The Stages in the Social History of
+Capitalism, by Henri Pirenne
+
+
+This eBook is for the use of anyone anywhere at no cost and with
+almost no restrictions whatsoever.  You may copy it, give it away or
+re-use it under the terms of the Project Gutenberg License included
+with this eBook or online at www.gutenberg.org
+
+
+
+
+
+Title: The Stages in the Social History of Capitalism
+       An Address Delivered at the International Congress of Historical Studies, London, April, 1913
+
+
+Author: Henri Pirenne
+
+
+
+Release Date: May 4, 2010  [eBook #32252]
+
+Language: English
+
+Character set encoding: ISO-8859-1
+
+
+***START OF THE PROJECT GUTENBERG EBOOK THE STAGES IN THE SOCIAL HISTORY
+OF CAPITALISM***
+
+
+E-text prepared by Fritz Ohrenschall, Martin Pettit, and the Project
+Gutenberg Online Distributed Proofreading Team (http://www.pgdp.net)
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+
+
+
+THE STAGES IN THE SOCIAL HISTORY OF CAPITALISM[1]
+
+by
+
+HENRI PIRENNE
+
+
+
+
+
+In the pages that follow I wish only to develop a hypothesis. Perhaps
+after having read them, the reader will find the evidence insufficient.
+I do not hesitate to recognize that the scarcity of special studies
+bearing upon my subject, at least for the period since the end of the
+Middle Ages, is of a nature to discourage more than one cautious spirit.
+But, on the one hand, I am convinced that every effort at synthesis,
+however premature it may seem, cannot fail to react usefully on
+investigations, provided one offers it in all frankness for what it is.
+And, on the other hand, the kind reception which the ideas here
+presented received at the International Congress of Historical Studies
+held at London last April, and the desire which has been expressed to me
+by scholars of widely differing tendencies to see them in print, have
+induced me to publish them. Various objections which have been expressed
+to me, as well as my own subsequent reflections, have caused me to
+revise and complete on certain points my London address. In the
+essential features, however, nothing has been changed.
+
+A word first of all to indicate clearly the point of view which
+characterizes the study. I shall not enter into the question of the
+formation of capital itself, that is, of the sum total of the goods
+employed by their possessor to produce more goods at a profit. It is the
+capitalist alone, the holder of capital, who will hold our attention. My
+purpose is simply to characterize, for the various epochs of economic
+history, the nature of this capitalist and to search for his origin. I
+have observed, in surveying this history from the beginning of the
+Middle Ages to our own times, a very interesting phenomenon to which, so
+it seems to me, attention has not yet been sufficiently called. I
+believe that, for each period into which our economic history may be
+divided, there is a distinct and separate class of capitalists. In other
+words, the group of capitalists of a given epoch does not spring from
+the capitalist group of the preceding epoch. At every change in economic
+organization we find a breach of continuity. It is as if the capitalists
+who have up to that time been active, recognize that they are incapable
+of adapting, themselves to conditions which are evoked by needs hitherto
+unknown and which call for methods hitherto unemployed. They withdraw
+from the struggle and become an aristocracy, which if it again plays a
+part in the course of affairs, does so in a passive manner only,
+assuming the rôle of silent partners. In their place arise new men,
+courageous and enterprising, who boldly permit themselves to be driven
+by the wind actually blowing and who know how to trim their sails to
+take advantage of it, until the day comes when, its direction changing
+and disconcerting their manoeuvres, they in their turn pause and are
+distanced by new craft having fresh forces and new directions. In short,
+the permanence throughout the centuries of a capitalist class, the
+result of a continuous development and changing itself to suit changing
+circumstances, is not to be affirmed. On the contrary, there are as many
+classes of capitalists as there are epochs in economic history. That
+history does not present itself to the eye of the observer under the
+guise of an inclined plane; it resembles rather a staircase, every step
+of which rises abruptly above that which precedes it. We do not find
+ourselves in the presence of a gentle and regular ascent, but of a
+series of lifts.
+
+In order to establish the validity of these generalizations it is of
+course needful to control them by the observation of facts, and the
+longer the period of time covered the more convincing will the
+observations be. The economic history of antiquity is still too little
+known, and its relations to the ages which follow have escaped us too
+completely, for us to take our point of departure there; but the
+beginning of the Middle Ages gives us access to a body of material
+sufficient for our purpose.
+
+But first of all, it is needful to meet a serious objection. If it is in
+fact true, as seems to be usually conceded since the appearance of
+Bücher's brilliant _Entstehung der Volkswirtschaft_[2]--to say nothing
+here of the thesis since formulated with such extreme radicalism by W.
+Sombart[3]--that the economic organisation of the Middle Ages has no
+aspect to which one can rightly apply the term capitalistic, then our
+thesis is limited wholly to modern times and there can be no thought of
+introducing into the discussion the centuries preceding the Renaissance.
+But whatever may be the favor which it still enjoys, the theory which
+refuses to perceive in the medieval urban economy the least trace of
+capitalism has found in recent times ever increasing opposition. I will
+not even enumerate here the studies which seem to me to have in an
+incontrovertible manner established the fact that all the essential
+features of capitalism--individual enterprise, advances on credit,
+commercial profits, speculation, etc.--are to be found from the twelfth
+century on, in the city republics of Italy--Venice,[4] Genoa,[5] or
+Florence.[6] I shall not ask what one can call such a navigator as
+Romano Mairano (1152-1201), if, in spite of the hundreds of thousands of
+francs he employed in business, the fifty per cent. profits he realized
+on his operations in coasting trade, and his final failure, one persists
+in refusing to him the name of capitalist. I shall pass over the
+disproof of the alleged ignorance of the medieval merchants. I shall say
+nothing of the astonishing errors committed in the calculations, so
+confidently offered to us as furnishing mathematical proof of the
+naïveté of historians who can believe the commerce of the thirteenth and
+fourteenth centuries to have been anything more than that of simple
+peddlers, a sort of artisans incapable of rising even to the idea of
+profit, and having no views beyond the day's livelihood.[7] Important as
+all this may be, the weak point in the theory which I am here opposing
+seems to me to lie especially in a question of method. Bücher and his
+partizans, in my opinion, have, without sufficient care, used for their
+picture of the city economy of the Middle Ages the characteristics of
+the German towns and more particularly the German towns of the
+fourteenth and fifteenth centuries. Now the great majority of the German
+towns of that period were far from having attained the degree of
+development which had been reached by the great communes of northern
+Italy, of Tuscany, or of the Low Countries. Instead of presenting the
+classical type of urban economy, they are merely examples of it
+incompletely developed; they present only certain manifestations; they
+lack others, and particularly those which belong to the domain of
+capitalism. Therefore in presenting as true of all the cities of the
+Middle Ages a theory which rests only on the observation of certain of
+them, and those the least advanced, one is necessarily doing violence to
+reality. Bücher's description of _Stadtwirtschaft_ remains a masterpiece
+of penetration and economic understanding. But it is too restricted. It
+does not take account of certain elements of the problem, because these
+elements were not encountered in the narrow circle which the research
+covered. One may be confident that if, instead of proceeding from the
+analysis of such towns as Frankfort, this study had considered
+Florence, Genoa, and Venice, or even Ghent, Bruges, Ypres, Douai, or
+Tournai, the picture which it furnished us would have been very
+different. Instead of refusing to see capitalism of any kind in the
+economic life of the bourgeoisie, the author would have recognized, on
+the contrary, unmistakable evidences of capitalism. I shall later have
+occasion to return to this very essential question. But it was
+indispensable to indicate here the position which I shall take in regard
+to it.
+
+Of course I do not at all intend to reject _en bloc_ the ideas generally
+agreed upon concerning the urban economy of the Middle Ages. On the
+contrary, I believe them to be entirely accurate in their essential
+elements, and I am persuaded that, in a very large number of cases, I
+will even say, if you like, in the majority of cases, they provide us
+with a theory which is completely satisfactory. I am very far from
+maintaining that capitalism exercised a preponderant influence on the
+character of economic organization from the twelfth to the fifteenth
+centuries. I believe that, though it is not right to call this
+organization "acapitalistic", it is on the other hand correct to
+consider it "anticapitalistic". But to affirm this is to affirm the
+existence of capital. That organization recognized the existence of
+capital since it tried to defend itself against it, since, from the end
+of the thirteenth century onward, it took more and more measures to
+escape from its abuses. It is incontestable that, from this period on,
+it succeeded by legal force in diminishing the rôle which capitalism had
+played up to that time. In fact it is certain, and we shall have
+occasion to observe it, that the power of capital was much greater
+during the first part of the urban period of the Middle Ages than during
+the second. But even in the course of the latter period, if municipal
+legislation seems more or less completely to have shut it out from local
+markets, capital succeeded in preserving and in dominating a very
+considerable portion of economic activity. It is capital which rules in
+inter-local commerce, which determines the forms of credit, and which,
+fastening itself on all the industries which produce not for the city
+market but for exportation, hinders them from being controlled, as the
+others are, by the minute regulations which in innumerable ways cramp
+the activity of the craftsmen.[8]
+
+Let us recognize, then, that capitalism is much older than we have
+ordinarily thought it. No doubt its operation in modern times has been
+much more engrossing than in the Middle Ages. But that is only a
+difference of quantity, not a difference of quality, a simple difference
+of intensity not a difference of nature. Therefore, we are justified in
+setting the question we set at the beginning. We can, without fear of
+pursuing a vain shadow, endeavor to discern what throughout history have
+been the successive stages in the social evolution of capitalism.
+
+Of the period which preceded the formation of towns, that is, of the
+period preceding the middle of the eleventh century, we know too little
+to permit ourselves to tarry there. What may still have survived in
+Italy and in Gaul of the economic system of the Romans has disappeared
+before the beginning of the eighth century. Civilization has become
+strictly agricultural and the domain system has impressed its form upon
+it. The land, concentrated in large holdings in the hands of a powerful
+landed aristocracy, barely produces what is necessary for the proprietor
+and his _familia_. Its harvests do not form material for commerce. If
+during years of exceptional abundance the surplus is transported to
+districts where scarcity prevails, that is all. In addition certain
+commodities of ordinary quick consumption, and which nature has
+distributed unequally over the soil, such as wine or salt, sustain a
+sort of traffic. Finally, but more rarely, products manufactured by the
+rural industry of countries abounding in raw materials, such as, to cite
+only one, the friezes woven by the peasants of Flanders, maintain a
+feeble exportation. Of the condition of the _negociatores_ who served as
+the instruments of these exchanges, we know almost nothing. Many of them
+were unquestionably merchants of occasion, men without a country, ready
+to seize on any means of existence that came their way. Pursuers of
+adventure were frequent among these roving creatures, half traders, half
+pirates, not unlike the Arab merchants who even to our day have searched
+for and frequently have found fortunes amid the negro populations of
+Africa. At least, to read the history of that Samo who at the beginning
+of the eighth century, arriving at the head of a band of adventuring
+merchants among the Wends of the Elbe, ended by becoming their king,
+makes one think involuntarily of certain of those beys or sheiks
+encountered by voyagers to the Congo or the Katanga.[9] Clearly no one
+will try to find in this strong and fortunate bandit an ancestor of the
+capitalists of the future. Commerce, as he understood and practised it,
+blended with plunder, and if he loved gain it was not in the manner of a
+man of affairs but rather in that of a primitive conqueror with whom
+violence of appetite took the place of calculation. Samo was evidently
+an exception. But the spirit which inspired him may have inspired a
+goodly number of _negociatores_ who launched their barks on the streams
+of the ninth century. In the society of this period only the possession
+of land or attachment to the following of a great man could give one a
+normal position. Men not so provided were outside the regular
+classification, forming a confused mass, in which were promiscuously
+mingled professional beggars, mercenaries in search of employment,
+masters of barges or drivers of wagons, peddlers, traders, all jostling
+in the same sort of hazardous and precarious life, and all no doubt
+passing easily from one employment to another. This is not to say,
+however, that among the _negociatores_ of the Frankish epoch there were
+not also individuals whose situation was more stable and whose means of
+existence were less open to suspicion. Indeed, we know that the great
+proprietors, lay or ecclesiastical, employed certain of their serfs or
+of their _ministeriales_ in a sporadic commerce of which we have already
+mentioned above the principal features. They commissioned them to buy at
+neighboring markets the necessary commodities or to transport to places
+of sale the occasional surplus of their grain or their wine. Here too we
+discover no trace of capitalism. We merely find ourselves in the
+presence of hereditary servants performing gratuitous service, entirely
+analogous to military service.
+
+Nevertheless commercial intercourse produced even then, in certain
+places particularly favored by their geographic situation, groups of
+some importance. We find them along the sea-coast--Marseilles, Rouen,
+Quentovic--or on the banks of the rivers, especially in those places
+where a Roman road crosses the stream, as at Maastricht on the Meuse or
+at Valenciennes on the Scheldt. We are to think of these _portus_ as
+wharves for merchandise and as winter quarters for boats and boatmen.
+They differ very distinctly from the towns of the following period. No
+walls surround them; the buildings which are springing up seem to be
+scarcely more than wooden sheds, and the population which is found there
+is a floating population, destitute of all privileges and forming a
+striking contrast to the bourgeoisie of the future. No organization
+seems to have bound together the adventurers and the voyagers of these
+_portus_. Doubtless it is possible, it is even probable, that a certain
+number of individuals, profiting by circumstance, may have little by
+little devoted themselves to trade in a regular fashion and have begun
+by the ninth century to form the nucleus of a group of professional
+traders. But we have too little information to enable us to speak with
+any precision.
+
+The operations of credit follow much the same course. We cannot doubt
+that loans had been employed in the Carolingian period, and the Church
+as well as the State had occupied itself in combating their abuses.[10]
+But it would be a manifest exaggeration to deduce from this the
+existence of even a rudimentary capitalistic economy. Everything
+indicates that the loans which we are considering here were only
+occasional loans, of usurious nature, to which people who had met with
+some catastrophe, such as war, a fire, or a poor harvest, were forced to
+have recourse temporarily.
+
+Thus, the early centuries of the Middle Ages seem to have been
+completely ignorant of the power of capital. They abound in wealthy
+landed proprietors, in rich monasteries, and we come upon hundreds of
+sanctuaries the treasure of which, supplied by the generosity of the
+nobles or the offerings of the faithful, crowds the altar with ornaments
+of gold or of solid silver. A considerable fortune is accumulated in the
+Church, but it is an idle fortune. The revenues which the landowners
+collect from their serfs or from their tenants are directed toward no
+economic purpose. They are scattered in alms, in the building of
+monuments, in the purchase of works of art, or of precious objects which
+should serve to increase the splendor of religious ceremonies. Wealth,
+capital, if one may so term it, is fixed motionless in the hands of an
+aristocracy, priestly or military. This is the essential condition of
+the patronage that this aristocracy (_majores et divites_) exercises
+over the people (_pauperes_). Its action is as important from the social
+point of view as it is unimportant from that of economics. No part of it
+is directed toward the _negociatores_, who, left to themselves, live, so
+to speak, on the fringe of society. And so it will continue to be, for
+long centuries.
+
+Landed property, indeed, did not contribute at all to that awakening of
+commercial activity which, after the disasters of the Norman invasion in
+the North and the Saracen raids on the shores of the Mediterranean,
+began to manifest itself toward the end of the tenth century and the
+beginning of the eleventh. Its preliminary manifestations are found at
+the two extremities of the Continent, Italy and the Low Countries. The
+interior seas, between which Europe was restricted in her advance toward
+the Atlantic, were its first centres of activity. Venice, then Genoa and
+Pisa, venture on the coasting trade along their shores, and then
+maintain, with their rich neighbors of Byzantium or of the Mohammedan
+countries, a traffic which henceforward constantly increases. Meanwhile
+Bruges at the head of the estuary of the Zwyn, becomes the centre of a
+navigation radiating toward England, the shores of North Germany, and
+the Scandinavian regions. Thus, economic life, as in the beginning of
+Hellenic times, first becomes active along the coasts. But soon it
+penetrates into the interior of the country. Step by step it wins its
+way along the rivers and the natural routes. On this side and on that,
+it arouses the hinterland into which the harbors cut their indentations.
+In this process of growth the two movements finally meet, and bring into
+communication the people of the North and the people of the South. By
+the beginning of the twelfth century it is an accomplished fact. In 1127
+Lombard merchants, journeying by the long route which descends from the
+passes of the Alps toward Champagne and the Low Countries, reach the
+fairs of Flanders.
+
+If the feeble and precarious commercial activity of the Carolingian
+period was sufficient to create gathering-places of merchants at the
+points most frequented in travel, it is not difficult to understand that
+the steady progress of economic activity from the end of the tenth
+century would result in the formation, at the strategic points of
+regional transit, of aggregations of like character but much more
+important and more stable. The surface of the land, the direction and
+the depth of the streams, determining the routes of commerce, also
+determined the location of the towns. Indeed, European cities are the
+daughters of commerce and of industry. Unquestionably in the countries
+of old civilization, in Italy or in Gaul, the Roman cities had not
+completely disappeared. Within the circle of their walls, which had now
+become too large and were filled with ruins, there gathered, around the
+bishop resident in each of them, a whole population of clerics and
+monks, and beside them a lay population employed in their service or
+support. In the North, one found the same spectacle at the centres of
+the new dioceses, at Thérouanne, at Utrecht, at Magdeburg, or at Vienna.
+But here was no trace, properly speaking, of municipal life. A certain
+number of artisans, some of them serfs, a little weekly market for the
+most indispensable commodities, sometimes a fair visited by the
+merchant-adventurers of whom we have spoken above--this is the sum total
+of economic life.
+
+But the situation changes from the moment when the increasing intensity
+of commerce begins to furnish men with new means of existence.
+Immediately one discovers an uninterrupted movement of migration of
+peasants from the country towards the places in which the handling of
+merchandise, the towing of boats, the service of merchants furnish
+regular occupations and arouse the hope of gain.
+
+If the old cities disadvantageously placed at one side from the highways
+of travel continue in their torpor, the others see their population
+increase continuously. Suburbs join the old enclosure; new markets are
+established; new churches are built for the new comers; and soon the
+primitive nucleus of the town, surrounded on all sides by the houses of
+the immigrants, becomes merely the quarter of the priests, bound to the
+shadow of the cathedral and submerged on all sides by the expansion of
+lay life. Much that at the beginning was the essential is now nothing
+more than the accessory. The episcopal burg disappears amid
+faubourgs.[11] The city has not been formed by growing with its own
+forces. It has been brought into existence by the attraction which it
+has exerted upon its surroundings whenever it has been aided by its
+situation. It is the creation of those who have migrated toward it. It
+has been made from without and not from within. The bourgeoisie of the
+oldest towns of Europe is a population of the transplanted. But it is at
+the same time essentially a trading population, and no other proof of
+this need be advanced than the fact that, down to the beginning of the
+twelfth century, _mercator_ and _burgensis_ were synonymous terms.
+
+Whence came these pioneers of commerce, these immigrants seeking means
+of subsistence, and what resources did they bring with them into the
+rising towns? Doubtless only the strength of their arms, the force of
+their wills, the clearness of their intelligence. Agricultural life
+continued to be the normal life and none of those who remained upon the
+soil could entertain the idea of abandoning his holding to go to the
+town and take his chances in a new existence. As for selling the holding
+to get ready money, like the men of a modern rural population, no one at
+that time could have imagined such a transaction. The ancestors of the
+bourgeoisie must then be sought, specifically, in the mass of those
+wandering beings who, having no land to cultivate, floated across the
+surface of society, living from day to day upon the alms of the
+monasteries, hiring themselves to the cultivators of the soil in harvest
+time, enlisting in the armies in time of war, and shrinking from neither
+pillage nor rapine if the occasion presented itself. It may without
+difficulty be admitted that there may have been among them some rural
+artisans or some professional peddlers. But it is beyond question that
+with very few exceptions it was poor men who floated to the towns and
+there built up the first fortunes in movable property that the Middle
+Ages knew.
+
+Fortunately we possess certain narratives which enable us to support
+this thesis with concrete examples. It will suffice to cite here the
+most characteristic of them, the biography of St. Godric of
+Finchale.[12]
+
+He was born of poor peasants in Lincolnshire, toward the end of the
+eleventh century, and from infancy was forced to tax his ingenuity to
+find the means of livelihood. Like many other unfortunates of all times,
+he at first walked the beaches on the outlook for wreckage cast up by
+the sea. Then we see him, perhaps by reason of some fortunate find,
+setting up as a peddler and travelling through the country with a little
+pack of goods (_cum mercibus minutis_). At length he gathers together a
+small sum, and one fine day joins a troop of town merchants whom he has
+met in the course of his wanderings. Thenceforward he goes with his
+companions from market to market, from fair to fair, from town to town.
+Having thus become a professional merchant, he rapidly gains a
+sufficient sum to enable him to associate himself with other merchants,
+charter a boat with them, and engage in the coasting trade along the
+shores of England, Scotland, Denmark, and Flanders. The company is
+highly successful. Its operations consist in carrying to a foreign
+country goods which it knows to be uncommon there, in selling them there
+at a high price, and acquiring in exchange various merchandise which it
+takes pains to dispose of in the places where the demand for them is
+greatest and where it can consequently make the greatest gains. At the
+end of some years this prudent practice of buying cheap and selling dear
+has made of Godric, and doubtless of his associates, a man of important
+wealth. Then, touched by divine grace, he suddenly renounces his
+fortune, gives his goods to the poor, and becomes a monk.
+
+The story of Godric, if one omits its pious conclusion, must have been
+that of many others. It shows us, with perfect clearness, how a man
+beginning with nothing might in a relatively short time amass a
+considerable capital. Our adventurer must have been favored by
+circumstances and chance. But the secret of his success, and the
+contemporary biographer to whom we owe the story insists strongly upon
+it, is intelligence.[13] Godric in fact shows himself a calculator, I
+might even say a speculator. He has in a high degree the feeling, and it
+is much more developed among minds without culture than is usually
+thought, for what is practicable in commerce. He is on fire with the
+love of gain. One sees clearly in him that famous _spiritus
+capitalisticus_ of which some would have us believe that it dates only
+from the time of the Renaissance. Here is an eleventh-century merchant,
+associated with companions like himself, combining his purchases,
+reckoning his profits, and, instead of hiding in a chest the money he
+has gained, using it only to support and extend his business. More than
+this, he does not hesitate to devote himself to operations which the
+Church condemns. He is not disquieted by the theory of the just price;
+the Decretum of Gratian disapproves in express terms of the speculations
+which he practises: "Qui comparat rem ut illam ipsam integram et
+immutatam dando lucretur, ille est mercator qui de templo Dei ejicitur".
+
+After this, how can we see, in Godric and any of those who led the same
+sort of life, anything else but capitalists? It is impossible to
+maintain that these men conducted business only to supply their daily
+wants, impossible not to see that their purpose is the constant
+accumulation of goods, impossible to deny that, barbarous as we may
+suppose them, they none the less possessed the comprehension, or, if one
+prefers, had the instinct for commerce on the large scale.[14] Of the
+organization of this commerce the life of Godric shows us already the
+principal features, and the description which it gives us of them is the
+more deserving of confidence because it is corroborated in the most
+convincing fashion by many documents. It shows us, first of all, the
+merchant coming from the country to establish himself in the town. But
+the town is to him, so to speak, merely a basis of operations. He lives
+there but little, save in the winter. As soon as the roads are
+practicable and the sea open to navigation, he sets out. His commerce is
+essentially a wandering commerce, and at the same time a collective one,
+for the insecurity of the roads and the powerlessness of the solitary
+individual compel him to have recourse to association. Grouped in gilds,
+in hanses, in _caritates_, the associates take their merchandise in
+convoy from town to town, presenting a spectacle entirely like that
+which the caravans of the East still furnish in our day. They buy and
+sell in common, dividing the profits in the ratio of their respective
+investments in the expedition, and the trade they carry on in the
+foreign markets is wholesale trade, and can only be that, for retail
+trade, as the life of Godric shows us, is left to the rural peddlers. It
+is in gross that they export and import wine, grain, wool, or cloth. To
+convince ourselves of this we need only examine the regulations which
+have been preserved to us. The statutes of the Flemish hanse of London,
+for example, formally exclude retail dealers and craftsmen from the
+company.
+
+Moreover, the merchant associations of the eleventh and twelfth
+centuries have nothing exclusively local in their character. In them we
+find bourgeoisie of different towns, side by side. They have rather the
+appearance of regional than of urban organisms. They are still far from
+the exclusivism and the protectionism which are to be shown with so much
+emphasis in the municipal life of the fourteenth century. Commercial
+freedom is not troubled by any restrictive regulations. Public authority
+assigns no limits to the activity of the merchants, does not restrict
+them to this or that kind of business, exercises no supervision over
+their operations. Provided they pay the fiscal dues (_teloneum,
+conductus_, etc.) levied by the territorial prince and the seigneurs
+having jurisdiction at the passage of the bridges, along the roads and
+rivers, or at the markets, they are entirely free from all legal
+obstacles. The only restrictions which hinder the full expansion of
+commerce do not come from the official authority, but result from the
+practices of commerce itself. To wit, the various merchant associations,
+gilds, hanses, etc., which encounter each other at the places of buying
+and selling, oppose each other in brutal competition. Each of them
+excludes from all participation in its affairs the members of all the
+others. But this is merely a state of facts, resting on no legal title.
+Force holds here the place of law, and whatever may be the differences
+of time and of environment, one cannot do otherwise than to compare the
+commerce of the eleventh and twelfth centuries to that bloody
+competition in which, in the sixteenth and seventeenth centuries, the
+sailors of Holland, England, France, and Spain engaged in the markets of
+the New World. We shall conclude then that medieval commerce, at its
+origin, is essentially characterized by its regional quality and by its
+freedom. And it is not difficult to understand that it was so, if one
+bears in mind two facts to which attention should be drawn.
+
+In the first place, down to the end of the twelfth century, the number
+of towns properly so-called was relatively small. Only those places that
+were favored by a privileged geographical situation attracted the
+merchants in sufficient number to enable them to maintain a commercial
+movement of real importance. After that the attraction which these
+centres of business exerted upon their environs was much greater than is
+ordinarily imagined. All the secondary localities were subject to their
+influence. The merchants dwelling in these last, too few to act by
+themselves, affiliated themselves to the hanse or gild of the principal
+town. The Flemish hanse, which we have already instanced, proves this
+fully, by showing us the merchants of Dixmude, Damme, Oudenbourg,
+Ardenbourg, etc., seeking admission into the hanse of Bruges.
+
+In the second place, at the period we have now reached the towns devoted
+themselves far more to commerce than to industry. Few could be cited
+that appear thus early as manufacturing centres. The concentration of
+artisans within their walls is still incomplete. If their merchants
+export, along with the products of the soil, such as wine and grain, a
+quantity of manufactured products, such, for example, as cloth, it is
+more than probable that these were for the most part made in the
+country.
+
+Admit these two statements, and the nature of early commerce is
+explained without difficulty. They account in fact both for the freedom
+of the merchants and for that character of wholesale exporters which
+they exhibit so clearly and which prevents our placing them in the
+category in which the theory of urban economy claims to confine them.
+Contrary to the general belief, it appears then that before the
+thirteenth century we find a period of free capitalistic expansion. No
+doubt the capitalism of that time is a collective capitalism: groups,
+not isolated individuals, are its instruments. No doubt too it contents
+itself with very simple operations. The commercial expeditions upon
+which its activity especially centres itself demand, for their
+successful conduct, an endurance, a physical strength, which the more
+advanced stages of economic evolution will not require. But they demand
+nothing more. Without the ability to plan and combine they would remain
+sterile. And so we can see that, from the beginning, what we find at the
+basis of capitalism is intelligence, that same intelligence which Georg
+Hansen has so well shown, long ago, to be the efficient cause of the
+emergence of the bourgeoisie.[15]
+
+The fortunes acquired inn the wandering commerce by the parvenus of the
+eleventh and twelfth centuries soon transformed them into landed
+proprietors. They invest a good part of their gains in lands, and the
+land they thus acquire is naturally that of the towns in which they
+reside. From the beginning of the thirteenth century one sees this land
+held in large parcels by an aristocracy of patricians, _viri
+hereditarii_, _divites_, _majores,_ in whom we cannot fail to recognize
+the descendants of the bold voyagers of the gilds and the hanses. The
+continuous increase of the burghal population enriches them more and
+more, for as new inhabitants establish themselves in the towns, and as
+the number of the houses increases, the rent of the ground increases in
+proportion. So, from the commencement of the thirteenth century, the
+grandsons of the primitive merchants abandon commerce and content
+themselves with living comfortably upon the revenue of their lands. They
+bid farewell to the agitations and the chances of the wandering life.
+They live henceforward in their stone houses, whose battlements and
+towers rise above the thatched roofs of the wooden houses of their
+tenants. They assume control of the municipal administration; they and
+their families monopolize the seats in the _échevinage_ or the town
+council. Some even, by fortunate marriages, ally themselves with the
+lesser nobility and begin to model their manner of living upon that of
+the knights.
+
+But while these first generations of capitalists are retiring from
+commerce and rooting themselves in the soil, important changes are going
+on in the economic organization. In the first place, in proportion as
+the wealth of the towns increases, and with it their attractive power,
+they take on more and more an industrial character, the rural artisans
+flocking into them _en masse_ and deserting the country. At the same
+time, many of them, favored by the abundance of raw material furnished
+by the surrounding region, begin to devote themselves to certain
+specialties of manufacture--cloth-making or metallurgy. Finally, around
+the principal aggregations many secondary localities develop, so that
+all Western Europe, in the course of the thirteenth century, blossoms
+forth in an abundance of large and small towns. Some, and much the
+greater number of them, content themselves perforce with local commerce.
+Their production is determined by the needs of their population and that
+of the environs which extend two or three leagues around their walls
+and, in exchange for the manufactured articles which the city furnishes
+to them, attend to the food supply of the urban inhabitants. Other
+towns, on the contrary, less closely set together but also more
+powerful, develop chiefly by means of an export industry, producing, as
+did the cloth industry of great Flemish or Italian cities, not for their
+local market,[16] but for the European market, constantly extensible.
+Others still, profiting by the advantages of nearness to the sea, give
+themselves up to navigation and to transportation, as did so many ports
+of Italy, of France, of England, and especially of North Germany.
+
+Of these two types of towns, the one sufficient to themselves, the other
+living upon the outside world, it is unquestionably the first to which
+the theory of the urban economy applies. Direct trade between purchaser
+and consumer, strict protectionism excluding the foreigner from the
+local market and reserving it to the bourgeoisie alone, minute
+regulations confining within narrow limits the industry of the merchant
+and the artisan; in a word, all the traits of an organization evidently
+designed to preserve and safeguard the various members of the community
+by assigning to each his place and his rôle, are all found and all
+explained without difficulty in those towns which are confined to a
+clientage limited by the extent of their suburban dependencies. In these
+one can rightly speak of an anti-capitalistic economy. In these we find
+neither great _entrepreneurs_ nor great merchants. It is true that the
+necessity of stocking the town with commodities which it does not
+produce or cannot find in its environs--groceries, fine cloths, wines in
+northern countries--brings into existence a group of exporters whose
+condition is superior to that of their fellow-citizens. But on
+inspection they cannot be regarded as a class of great professional
+merchants. If they buy at wholesale in foreign markets, it is to sell at
+retail to their fellow-citizens. They dispose of their goods piecemeal,
+and like the _Gewandschneider_ of the German towns, they do not rise
+above the level of large shopkeepers.[17]
+
+In the towns of the second category we find a quite different condition.
+Here capitalism not only exists but develops toward perfection.
+Instruments of credit, such as the _lettre de foire,_ make their
+appearance; a traffic in money takes its place alongside the traffic in
+merchandise and, despite the prohibition of loans at interest, makes
+constantly more rapid progress. The _coutumes_ of the fairs, especially
+those of the fairs of the Champagne, in which the merchants of the
+regions most advanced in an economic sense, Italy and the Low Countries,
+meet each other, give rise to a veritable commercial law. The
+circulation of money expands and becomes regulated; the coinage of gold,
+abandoned since the Merovingian period, is resumed in the middle of the
+thirteenth century. The security of travellers increases on the great
+highways. The old Roman bridges are rebuilt and here and there canals
+are built and dykes constructed. Finally, in the towns, the commercial
+buildings of the previous period, outgrown, are replaced by structures
+more vast and more luxurious, of which the _halles_ of Ypres, with their
+façade one hundred and thirty-three metres long, is doubtless the most
+imposing specimen.
+
+In the presence of these facts it is impossible to deny the existence of
+a considerable traffic. Moreover documents abound which attest the
+existence in the great cities of men of affairs who hold the most
+extended relations with the outside world, who export and import sacks
+of wool, bales of cloth, tuns of wine, by the hundred, who have under
+their orders a whole corps of factors or "sergents" (_servientes_,
+_valets_, etc.), whose letters of credit are negotiated in the fairs of
+Champagne, and who make loans amounting to several thousands of livres
+to princes, monasteries, and cities in need of money. To cite here
+merely a few figures, let us recall that in 1273 the company of the
+Scotti of Piacenza exports wool from England to the value of 21,400
+pounds sterling, or 1,600,000 francs (metallic value);[18] in 1254
+certain burgesses of Arras furnish 20,000 livres to the Count of Guines,
+prisoner of the Count of Flanders, to enable him to pay his ransom.[19]
+In 1339 three merchants of Mechlin advance 54,000 florins (700,000
+francs) to King Edward III.[20]
+
+Extensive however as capitalistic commerce has been since the first half
+of the thirteenth century, it no longer enjoys the freedom of
+development which it had before. As we advance toward the end of the
+Middle Ages, indeed, we see it subjected to limitations constantly more
+numerous and more confining. Henceforth, in fact, it has to reckon with
+municipal legislation. Every town now shelters itself behind the
+ramparts of protectionism. If the most powerful cities can no longer
+exclude the stranger, upon whom they live, they impose upon him a minute
+regulation, the purpose of which is to defend against him the position
+of their own citizens. They force him to have recourse in his purchases
+to the mediation of his "hosts" and his "courtiers"; they forbid him to
+bring in manufactured articles which may compete with those which the
+city produces; they exploit him by levying taxes of all sorts: duties
+upon weighing, upon measuring, upon egress, etc.
+
+In those cities especially in which has occurred the popular revolution
+transferring power from the hands of the patriciate into those of the
+craft-gilds, distrust of capital is carried as far as it can go without
+entirely destroying urban industry. The craftsmen who produce for
+exportation--for example, the weavers and the fullers of the towns of
+Flanders--try to escape from their subjection, to the merchants who
+employ them. Not only do the municipal statutes fix wages and regulate
+the conditions of work, but they also limit the independence of the
+merchant, even in purely commercial matters. It will be sufficient to
+mention here, as one of their most characteristic provisions, the
+forbidding of the cloth merchant to be at the same time a wool merchant,
+a prohibition inspired by the desire to prevent operations that will
+unfavorably affect prices and the workman's wages.[21]
+
+But it is not solely the municipal authority which attacks the
+speculations born of the capitalistic spirit. The Church steps forward,
+and under the name of usury forbids indiscriminately the lending of
+money at interest, sales on credit, monopolies, and in general all
+profits exceeding the _justum pretium_. No doubt these prohibitions
+themselves attest the existence of the abuses which they endeavor to
+oppose, and their frequency proves that they did not always succeed. It
+is none the less true that they were very burdensome and that the
+pursuit of business on a large scale found itself much embarrassed by
+them.
+
+The increasing specialization of commerce embarrassed it much more. At
+the beginning the merchants had devoted themselves to the most various
+operations at once. Wandering from market to market, they bought and
+sold without feeling in need of centring their activity on this or that
+kind of products or commodities, but from about 1250 this is no longer
+the case. The progress of economic evolution has resulted in localizing
+certain industries and in restraining certain branches of commerce to
+the groups of merchants best suited to their promotion. Thus, for
+example, in the course of the thirteenth century the trade in fine cloth
+became a monopoly of the towns of Flanders, and banking a monopoly of
+certain merchant companies of Lombardy, Provence, or Tuscany.
+Thenceforward commercial life ceases to overflow at random, so to speak.
+It has a less arbitrary, a more deliberate, and consequently a more
+embarrassed quality.
+
+These limitations resting upon commerce have resulted in turning away
+from it the patricians, who moreover have become, as has been said
+above, a class of landed proprietors. The place which they left vacant
+is filled by new men, among whom, as among their predecessors,
+intelligence is the essential instrument of fortune. The intellectual
+faculties which the first developed in wandering commerce are used by
+these later men to overcome the obstacles raised in their pathway by
+municipal regulations of commerce and ecclesiastical regulations in
+respect to money affairs.[22] Many of them find a rich source of profit
+by devoting themselves to brokerage. Others in the industrial cities
+exploit shamelessly and in defiance of the statutes the artisans whom
+they employ. At Douai, for example, Jehan Boinebroke (1280-1310)
+succeeds in reducing to serfdom a number of workers (and
+characteristically, they are chiefly women) by advancing wool or money
+which they are unable to repay, and which therefore place them at his
+mercy.[23] The richest or the boldest profit by the constantly
+increasing need of money on the part of territorial princes and kings,
+to become their bankers. It will be remembered that it was Lombard
+capitalists who furnished Edward III. with money to prepare his
+campaigns against France,[24] and, quite recently, the history of
+Guillaume Servat of Cahors (1280-1320) has shown us a man who, setting
+out with nothing, like Godric in the eleventh century, accumulates in a
+few years a considerable fortune, supplies the King of England with a
+dowry for one of his daughters, lends money to the King of Norway, farms
+the wool duties at London, and, unscrupulous as he is shrewd, does not
+hesitate to engage in shady speculations upon the coinage.[25] And how
+many other financiers do we not know whose career is wholly similar:
+Thomas Fin at the court of the counts of Flanders,[26] the Berniers at
+that of the counts of Hainaut, the Tote Guis, the Vane Guis, at that of
+the kings of France, not to name the numberless Italians entrusted by
+the popes with the various operations of pontifical finance, those
+_mercatores Romanam curiam sequentes_ among whom are found the ancestors
+of the great Medici of the fifteenth century.[27]
+
+In the course of the fifteenth century this second class of capitalists,
+courtiers, merchants, and financiers, successors to the capitalists of
+the hanses and the gilds, is in its turn drawn along toward the downward
+grade. The progress of navigation, the discoveries made by the
+Portuguese, then by the Spaniards, the formation of great monarchical
+states struggling for supremacy, begin to destroy the economic situation
+in the midst of which that class had grown to greatness, and to which
+it had adapted itself. The direction of the currents of commerce is
+altered. In the north, the English and Dutch marine gradually take the
+place of the hanses. In the Mediterranean, commerce centres itself at
+Venice and at Genoa. On the shores of the Atlantic, Lisbon becomes the
+great market for spices, and Antwerp, supplanting Bruges, becomes the
+rendezvous of European commerce. The sixteenth century sees this
+movement grow more rapid. It is favored at once by moral, political, and
+economic causes; the intellectual progress of the Renaissance, the
+expansion of individualism, great wars exciting speculation, the
+disturbance of monetary circulation caused by the influx of precious
+metals from the New World. As the science of the Middle Ages disappears
+and the humanist takes the place of the scholastic, so a new economy
+rises in the place of the old urban economy. The state subjects the
+towns to its superior power. It restrains their political autonomy at
+the same time that is sets commerce and industry free from the
+guardianship which the towns have hitherto imposed upon them. The
+protectionism and the exclusiveness of the bourgeoisies are brought to
+an end. If the craft-guilds continue to exist, yet they no longer
+control the organization of labor. New industries appear, which, to
+escape the meddling surveillance of the municipal authorities, establish
+themselves in the country. Side by side with the old privileged towns,
+which merely vegetate, younger manufacturing centres, full of strength
+and exuberance, arise; in England, Sheffield, and Birmingham, in
+Flanders, Hondschoote and Armentières.[28]
+
+The spirit in which is now manifested in the world of business, is that
+same spirit of freedom which animates the intellectual world. In a
+society in process of formation, the individual, enfranchised, gives the
+rein to his boldness. He despises tradition, gives himself up with
+unrestrained delight to his virtuosity. There are to be no more limits
+on speculation, no more fetters on commerce, no more meddling of
+authority in relations between employers and employed. The most skillful
+wins. Competition, up to this time held in check, runs riot. In a few
+years enormous fortunes are built up, others are swallowed up in
+resounding bankruptcies. The Antwerp exchange is a pandemonium where
+bankers, deep-sea sailors, stock-jobbers, dealers in futures,
+millionaire merchants, jostle each other--and sharpers and adventurers
+to whom all means of money-getting, even assassination, are acceptable.
+
+This confused recasting of the economic world transfers the rôle played
+by the capitalists of the late Middle Ages in a class of new men. Few
+are the descendants of the business men of the fourteenth century among
+those of the fifteenth and sixteenth. Thrown out of their course by the
+current of events, they have not been willing to risk fortunes already
+acquired. Most of them are seen turning toward administrative careers,
+entering the service of the state as members of the councils of justice
+or finance and aspiring to the _noblesse de robe_, which, with the aid
+of fortunate marriages, will land their sons in the circle of the true
+nobility. As for the new rich of the period, they almost all appear to
+us like parvenus. Jacques Coeur is a parvenu in France. The Fugger and
+many other German financiers--the Herwarts, the Seilers, the Manlichs,
+the Haugs--are parvenus of whose families we know little before the
+fifteenth century, and so are the Frescobaldi and the Gualterotti of
+Florence, or that Gaspar Ducci of Pistoia who is perhaps the most
+representative of the fortune-hunters of the period.[29] Later, when
+Amsterdam has inherited the commercial hegemony of Antwerp, the
+importance of the parvenus characterizes it not less clearly. We may
+merely mention here, among the first makers of its greatness, Willem
+Usselinx,[30] Balthazar de Moucheron, Isaac Lemaire. And if from the
+world of commerce we turn toward that of industry the aspect is the
+same. Christophe Plantin, the famous printer, is the son of a simple
+peasant of Touraine.
+
+The exuberance of capitalism which reached its height in the second half
+of the sixteenth century was not maintained. Even as the regulative
+spirit characteristic of the urban economy followed upon the freedom of
+the twelfth century, so mercantilism imposed itself upon commerce and
+industry in the seventeenth and eighteenth centuries. By protective
+duties and bounties on exportation, by subsidies of all sorts to
+manufactures and national navigation, by the acquiring of transmarine
+colonies, by the creation of privileged commercial companies, by the
+inspection of manufacturing processes, by the perfecting of means of
+transportation and the suppression of interior custom-houses, every
+state strives to increase its means of production, to close its market
+to its competitors, and to make the balance of trade incline in its
+favor. Doubtless the idea that "liberty is the soul of commerce" does
+not wholly disappear, but the endeavor is to regulate that liberty
+henceforward in conformity to the interest of the public weal. It is put
+under the control of intendants, of consuls, of chambers of commerce. We
+are entering into the period of national economy.
+
+This was destined to last, as is familiar, until the moment when, in
+England at the end of the eighteenth century, on the Continent in the
+first years of the nineteenth, the invention of machinery and the
+application of steam to manufacturing completely disorganized the
+conditions of economic activity. The phenomena of the sixteenth century
+are reproduced, but with tenfold intensity. Merchants accustomed to the
+routine of mercantilism and to state protection are pushed aside. We do
+not see them pushing forward into the career which opens itself before
+them, unless as lenders of money. In their turn, and as we have seen it
+at each great crisis of economic history, they retire from business and
+transform themselves into an aristocracy. Of the powerful houses which
+are established on all hands and which give the impetus to the modern
+industries of metallurgy, of the spinning and weaving of wool, linen,
+and cotton, hardly one is connected with the establishments existing
+before the end of the eighteenth century. Once again, it is new men,
+enterprising spirits, and sturdy characters which profit by the
+circumstances.[31] At most, the old capitalists, transformed into landed
+proprietors, play still an active rôle in the exploitation of the mines,
+because of the necessary dependence of that industry upon the possessors
+of the soil, but it can be safely affirmed that those who have presided
+over the gigantic progress of international economy, of the exuberant
+activity which now affects the whole world, were, as at the time of the
+Renaissance, parvenus, self-made men. As at the time of the Renaissance,
+again, their belief is in individualism and liberalism alone. Breaking
+with the traditions of the old régime, they take for their motto
+"_laissez faire, laissez passer_". They carry the consequences of the
+principle to an extreme. Unrestrained competition sets them to
+struggling with each other and soon arouses resistance in the form of
+socialism, among the proletariate that they are exploiting. And at the
+same time that that resistance arises to confront capital, the latter,
+itself suffering from the abuses of that freedom which had enabled it to
+rise, compels itself to discipline its affairs. Cartels, trusts,
+syndicates of producers, are organized, while states, perceiving that it
+is impossible to leave employers and employees longer to contend in
+anarchy, elaborate a social legislation; and international regulations,
+transcending the frontiers of the various countries, begin to be applied
+to working men.
+
+I am aware how incomplete is this rapid sketch of the evolution of
+capitalism through a thousand years of history. As I said at the
+beginning, I present it merely as an hypothesis resting on the very
+imperfect knowledge which we yet possess of the different movements of
+economic development. Yet, in so far as it is exact, it justifies the
+observation I made at the beginning of this study. It shows that the
+growth of capitalism is not a movement proceeding along a straight line,
+but has been marked, rather, by a series of separate impulses not
+forming continuations one of another, but interrupted by crises.
+
+To this first remark may be added two others, which are in a way
+corollaries.
+
+The first relates to the truly surprising regularity with which the
+phases of economic freedom and of economic regulation have succeeded
+each other. The free expansion of wandering commerce comes to its end in
+the urban economy, the individualistic ardor of the Renaissance leads to
+mercantilism, and finally, to the age of liberalism succeeds our own
+epoch of social legislation.
+
+The second remark, with which I shall close, lies in the moral and
+political rather than the economic field. It may be stated in this form,
+that every class of capitalists is at the beginning animated by a
+clearly progressive and innovating spirit but becomes conservative as
+its activities become regulated. To convince one's self of this truth it
+is sufficient to recall that the merchants of the eleventh and twelfth
+centuries are the ancestors of the bourgeoisie and the creators of the
+first urban institutions; that the business men of the Renaissance
+struggled as energetically as the humanists against the social
+traditions of the Middle Ages; and finally, that those of the nineteenth
+century have been among the most ardent upholders of liberalism. This
+would suffice to prove to us, if we did not know it otherwise, that all
+these have at the beginning been nothing else than parvenus brought into
+action by the transformations of society, embarrassed neither by custom
+nor by routine, having nothing to lose and therefore the bolder in their
+race toward profit. But soon the primitive energy relaxes. The
+descendants of the new rich wish to preserve the situation which they
+have acquired, provided public authority will guarantee it to them, even
+at the price of a troublesome surveillance; they do not hesitate to
+place their influence at its service, and wait for the moment when,
+pushed aside by new men, they shall demand of the state that it
+recognize officially the rank to which they have raised their families,
+shall on their entrance into the nobility become a legal class and no
+longer a social group, and shall consider it beneath them to carry on
+that commerce which in the beginning made their fortunes.
+
+FOOTNOTES:
+
+[1] This article represents the substance of an address delivered at the
+International Congress of Historical Studies held in London, April,
+1913.
+
+[2] First edition in 1893.
+
+[3] _Der Moderne Capitalismus_ (1902).
+
+[4] R. Heynen, _Zur Entstehung des Capitalismus in Venedig_ (1905).
+
+[5] H. Sieveking, "Die Capitalistische Entwickelung in den Italienischen
+Städten des Mittelalters", _Vierteljahrschrift für Social-und
+Wirtschaftsgeschichte_ (1909).
+
+[6] Davidsohn, _Forschungen zur Geschichte von Florenz_, III. 36; A.
+Doren, _Die Florentiner Wollentuchindustrie_, p. 481.
+
+[7] A. Schaube, "Die Wollausfuhr Englands von 1272", _Vierteljahrschrift
+für Social- und Wirtschaftsgeschichte_ (1908), pp. 39 ff. _Cf._ F.
+Keutgen, "Hansische Handelsgesellschaften", _ibid._ (1906), pp. 288 ff.
+
+[8] _Cf._ H. Pirenne, _Les Anciennes Democraties des Pays-Bas_, pp. 11
+ff.
+
+[9] I. Goll, "Samo und die Karantinischen Slaven", _Mitteilungen des
+Instituts für Oesterreichische Geschichtsforschung_, vol. XI.
+
+[10] A. Dopsch, _Die Wirtschaftsentwickelung der Karolingerzeit_, II.
+274. I cannot, however, accept the thesis of Mr. Dopsch on the
+importance of commerce in the Carolingian period. The extremely
+interesting texts which he has assembled seem to me to establish the
+existence of a sporadic commerce only.
+
+[11] Of course all the new towns did not grow up around an episcopal
+residence. Many of them, especially in the North and particularly in the
+Low Countries, had as their primitive nucleus a fortress (Ghent, Bruges,
+Ypres, Lille, Douai, etc.). But my purpose here is merely to recall the
+broad outlines of the subject.
+
+[12] See on this subject the interesting article by W. Vogel, "Ein
+Seefahrender Kaufmann um 1100", _Hansische Geschichtsblätter_ (1912),
+pp. 239 ff.
+
+[13] "Unde non agriculturae delegit exercitia colere, sed potius, quae
+sagacioris animi sunt, rudimenta studuit arripiendo exercere."
+
+[14] One finds already in the twelfth century lenders of money
+undertaking veritable financial operations. See H. Jenkinson and M. T.
+Stead, "William Cade: a Financier of the Twelfth Century", _English
+Historical Review_ (1913), p. 209 ff.
+
+[15] _Die drei Bevölkerungsstufen._
+
+[16] The _Livre de la Vingtaine d'Arras_ (ed. A. Guesnon) says, in
+speaking of the merchants of that town, in 1222, "Emunt non ad usum
+civitatis, sed ut exportent et discurrant per nondinas longinquas et per
+Lombardiam".
+
+[17] G. von Below, "Grosshändler und Kleinhändler im Deutschen
+Mittelalter", _Jahrbücher für Nationalökonomie und Statistik_ (1900).
+
+[18] A. Schaube, "Die Wollausfuhr Englands vom Jahre 1273",
+_Vierteljahrschrift für Social- und Wirtschaftsgeschichte_ (1908), p.
+183.
+
+[19] A. Duchesne, _Histoire des Maisons de Guines, d'Ardres et de Gand_,
+p. 289.
+
+[20] Rymer, _Foedera_, vol. II., part IV., p. 49.
+
+[21] For an example, see Espinas and Pirenne, _Recueil de Documents
+relatifs à l'Histoire de la Draperie Flamande_, II. 391.
+
+[22] J. Kulischer, "Warenhändler und Geldausleiher im Mittelalter",
+_Zeitschrift für Volkswirtschaft_, etc., XVII. (1908).
+
+[23] G. Espinas, "Jehan Boine-Broke, Bourgeois et Drapier Douaisien",
+_Vierteljahrschrift für Social- und Wirtschaftsgeschichte_ (1904), pp.
+34 ff.
+
+[24] For the relations of the capitalists with the English crown see:
+Whitwell, "Italian Bankers and the English Crown", _Transactions of the
+Royal Historical Society_, XVII. (1903); and Bond, "Extract from the
+Liberate Rolls relative to the Loans supplied by Italian Merchants to
+the Kings of England", _Archaeologia_, XXVII. (1840). _Cf._ Hansen, "Der
+Englische Staatscredit unter König Edward III. und die Hansischen
+Kaufleute", _Hansische Geschichtsblätter_ (1910).
+
+[25] F. Arens, "Wilhelm Servat von Cahors als Kaufmann zu London",
+_Vierteljahrschrift für Social- und Wirtschaftsgeschichte_ (1913), pp.
+477 ff.
+
+[26] V. Fris, "Thomas Fin, Receveur de Flandre", _Bulletin de la
+Commission Royale d'Histoire de Belgique_ (1900), pp. 8 ff.
+
+[27] Schneider, "Die Finanziellen Beziehungen der Florentinischen
+Banquiers zur Kirche", _Schmollers Forschungen_, vol. XVII.
+
+[28] Pirenne, "Une Crise Industrielle an XVI^e Siècle", _Bulletin de
+l'Académie Royale de Belgique_, classe des lettres (1905).
+
+[29] R. Ehrenberg, _Das Zeitalter der Fugger_, I. 311 ff.
+
+[30] J. F. Jameson, "Willem Usselinx", in Am. Hist. Assoc., _Papers_,
+II.
+
+[31] See, in Cunningham, _The Growth of English Industry and Commerce in
+Modern Times_, p. 618, this citation from P. Gaskell: "Few of the men
+who entered the trade rich were successful. They trusted too much to
+others, too little to themselves." Let us recall here that the founder
+of the largest industrial establishments of Belgium, John Cockerill, was
+a simple workman. See E. Mahaim, "Les Débuts de l'Établissement John
+Cockerill à Seraing", _Vierteljahrschrift für Social- und
+Wirtschaftsgeschichte_ (1905), p. 627.
+
+
+
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+<meta http-equiv="Content-Type" content="text/html; charset=ISO-8859-1" />
+<title>The Project Gutenberg eBook of The Stages in the Social History of Capitalism, by Henri Pirenne</title>
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+<body>
+<h1>The Project Gutenberg eBook, The Stages in the Social History of
+Capitalism, by Henri Pirenne</h1>
+<pre>
+This eBook is for the use of anyone anywhere at no cost and with
+almost no restrictions whatsoever.  You may copy it, give it away or
+re-use it under the terms of the Project Gutenberg License included
+with this eBook or online at <a href = "http://www.gutenberg.org">www.gutenberg.org</a></pre>
+<p>Title: The Stages in the Social History of Capitalism</p>
+<p>       An Address Delivered at the International Congress of Historical Studies, London, April, 1913</p>
+<p>Author: Henri Pirenne</p>
+<p>Release Date: May 4, 2010  [eBook #32252]</p>
+<p>Language: English</p>
+<p>Character set encoding: ISO-8859-1</p>
+<p>***START OF THE PROJECT GUTENBERG EBOOK THE STAGES IN THE SOCIAL HISTORY OF CAPITALISM***</p>
+<p>&nbsp;</p>
+<h3>E-text prepared by Fritz Ohrenschall, Martin Pettit,<br />
+    and the Project Gutenberg Online Distributed Proofreading Team<br />
+    (http://www.pgdp.net)</h3>
+<p>&nbsp;</p>
+<table border="0" style="background-color: #ddddee;" cellpadding="10">
+  <tr>
+    <td valign="top">
+      Note:
+    </td>
+    <td>
+      Page numbers appear in the right margin. Click on the page number to
+      see an image of the original page.
+	</td>
+  </tr>
+</table>
+<p>&nbsp;</p>
+<hr class="full" />
+<p>&nbsp;</p>
+<p>&nbsp;</p>
+<p>&nbsp;</p>
+
+<h2>Henri Pirenne</h2>
+
+<h1>THE STAGES IN THE<br />SOCIAL HISTORY OF CAPITALISM</h1>
+
+<hr />
+
+<p><span class='pagenum'><a name="Page_1" id="Page_1"></a>[<a href="images/003.png">1</a>]</span></p>
+
+<h1>THE STAGES IN THE SOCIAL HISTORY OF<br />CAPITALISM<a name="FNanchor_1_1" id="FNanchor_1_1"></a><a href="#Footnote_1_1" class="fnanchor">[1]</a></h1>
+
+<p>In the pages that follow I wish only to develop a hypothesis. Perhaps
+after having read them, the reader will find the evidence insufficient.
+I do not hesitate to recognize that the scarcity of special studies
+bearing upon my subject, at least for the period since the end of the
+Middle Ages, is of a nature to discourage more than one cautious spirit.
+But, on the one hand, I am convinced that every effort at synthesis,
+however premature it may seem, cannot fail to react usefully on
+investigations, provided one offers it in all frankness for what it is.
+And, on the other hand, the kind reception which the ideas here
+presented received at the International Congress of Historical Studies
+held at London last April, and the desire which has been expressed to me
+by scholars of widely differing tendencies to see them in print, have
+induced me to publish them. Various objections which have been expressed
+to me, as well as my own subsequent reflections, have caused me to
+revise and complete on certain points my London address. In the
+essential features, however, nothing has been changed.</p>
+
+<p>A word first of all to indicate clearly the point of view which
+characterizes the study. I shall not enter into the question of the
+formation of capital itself, that is, of the sum total of the goods
+employed by their possessor to produce more goods at a profit. It is the
+capitalist alone, the holder of capital, who will hold our attention. My
+purpose is simply to characterize, for the various epochs of economic
+history, the nature of this capitalist and to search for his origin. I
+have observed, in surveying this history from the beginning of the
+Middle Ages to our own times, a very interesting phenomenon to which, so
+it seems to me, attention has not yet been sufficiently called. I
+believe that, for each period into which our economic history may be
+divided, there is a distinct and separate class of capitalists. In other
+words, the group of capitalists of a given epoch does not spring from
+the capitalist group of the preceding epoch. At every change in economic
+organization we find a breach of continuity. It is as if the capitalists
+who have up to that time been active, recognize that they are incapable
+of adapting, themselves to conditions which are evoked by needs hitherto
+unknown<span class='pagenum'><a name="Page_2" id="Page_2"></a>[<a href="images/004.png">2</a>]</span> and which call for methods hitherto unemployed. They withdraw
+from the struggle and become an aristocracy, which if it again plays a
+part in the course of affairs, does so in a passive manner only,
+assuming the r&ocirc;le of silent partners. In their place arise new men,
+courageous and enterprising, who boldly permit themselves to be driven
+by the wind actually blowing and who know how to trim their sails to
+take advantage of it, until the day comes when, its direction changing
+and disconcerting their manoeuvres, they in their turn pause and are
+distanced by new craft having fresh forces and new directions. In short,
+the permanence throughout the centuries of a capitalist class, the
+result of a continuous development and changing itself to suit changing
+circumstances, is not to be affirmed. On the contrary, there are as many
+classes of capitalists as there are epochs in economic history. That
+history does not present itself to the eye of the observer under the
+guise of an inclined plane; it resembles rather a staircase, every step
+of which rises abruptly above that which precedes it. We do not find
+ourselves in the presence of a gentle and regular ascent, but of a
+series of lifts.</p>
+
+<p>In order to establish the validity of these generalizations it is of
+course needful to control them by the observation of facts, and the
+longer the period of time covered the more convincing will the
+observations be. The economic history of antiquity is still too little
+known, and its relations to the ages which follow have escaped us too
+completely, for us to take our point of departure there; but the
+beginning of the Middle Ages gives us access to a body of material
+sufficient for our purpose.</p>
+
+<p>But first of all, it is needful to meet a serious objection. If it is in
+fact true, as seems to be usually conceded since the appearance of
+B&uuml;cher's brilliant <i>Entstehung der Volkswirtschaft</i><a name="FNanchor_2_2" id="FNanchor_2_2"></a><a href="#Footnote_2_2" class="fnanchor">[2]</a>&mdash;to say nothing
+here of the thesis since formulated with such extreme radicalism by W.
+Sombart<a name="FNanchor_3_3" id="FNanchor_3_3"></a><a href="#Footnote_3_3" class="fnanchor">[3]</a>&mdash;that the economic organisation of the Middle Ages has no
+aspect to which one can rightly apply the term capitalistic, then our
+thesis is limited wholly to modern times and there can be no thought of
+introducing into the discussion the centuries preceding the Renaissance.
+But whatever may be the favor which it still enjoys, the theory which
+refuses to perceive in the medieval urban economy the least trace of
+capitalism has found in recent times ever increasing opposition. I will
+not even enumerate here the studies which seem to me to have in an
+incontrovertible manner established the fact that all the essential
+features of capitalism&mdash;individual enterprise, advances on credit,
+commercial profits, <span class='pagenum'><a name="Page_3" id="Page_3"></a>[<a href="images/005.png">3</a>]</span>speculation, etc.&mdash;are to be found from the twelfth
+century on, in the city republics of Italy&mdash;Venice,<a name="FNanchor_4_4" id="FNanchor_4_4"></a><a href="#Footnote_4_4" class="fnanchor">[4]</a> Genoa,<a name="FNanchor_5_5" id="FNanchor_5_5"></a><a href="#Footnote_5_5" class="fnanchor">[5]</a> or
+Florence.<a name="FNanchor_6_6" id="FNanchor_6_6"></a><a href="#Footnote_6_6" class="fnanchor">[6]</a> I shall not ask what one can call such a navigator as
+Romano Mairano (1152-1201), if, in spite of the hundreds of thousands of
+francs he employed in business, the fifty per cent. profits he realized
+on his operations in coasting trade, and his final failure, one persists
+in refusing to him the name of capitalist. I shall pass over the
+disproof of the alleged ignorance of the medieval merchants. I shall say
+nothing of the astonishing errors committed in the calculations, so
+confidently offered to us as furnishing mathematical proof of the
+na&iuml;vet&eacute; of historians who can believe the commerce of the thirteenth and
+fourteenth centuries to have been anything more than that of simple
+peddlers, a sort of artisans incapable of rising even to the idea of
+profit, and having no views beyond the day's livelihood.<a name="FNanchor_7_7" id="FNanchor_7_7"></a><a href="#Footnote_7_7" class="fnanchor">[7]</a> Important as
+all this may be, the weak point in the theory which I am here opposing
+seems to me to lie especially in a question of method. B&uuml;cher and his
+partizans, in my opinion, have, without sufficient care, used for their
+picture of the city economy of the Middle Ages the characteristics of
+the German towns and more particularly the German towns of the
+fourteenth and fifteenth centuries. Now the great majority of the German
+towns of that period were far from having attained the degree of
+development which had been reached by the great communes of northern
+Italy, of Tuscany, or of the Low Countries. Instead of presenting the
+classical type of urban economy, they are merely examples of it
+incompletely developed; they present only certain manifestations; they
+lack others, and particularly those which belong to the domain of
+capitalism. Therefore in presenting as true of all the cities of the
+Middle Ages a theory which rests only on the observation of certain of
+them, and those the least advanced, one is necessarily doing violence to
+reality. B&uuml;cher's description of <i>Stadtwirtschaft</i> remains a masterpiece
+of penetration and economic understanding. But it is too restricted. It
+does not take account of certain elements of the problem, because these
+elements were not encountered in the narrow circle which the research
+covered. One may be confident that if, instead of proceeding from the
+analysis of such towns as Frankfort, this study had<span class='pagenum'><a name="Page_4" id="Page_4"></a>[<a href="images/006.png">4</a>]</span> considered
+Florence, Genoa, and Venice, or even Ghent, Bruges, Ypres, Douai, or
+Tournai, the picture which it furnished us would have been very
+different. Instead of refusing to see capitalism of any kind in the
+economic life of the bourgeoisie, the author would have recognized, on
+the contrary, unmistakable evidences of capitalism. I shall later have
+occasion to return to this very essential question. But it was
+indispensable to indicate here the position which I shall take in regard to it.</p>
+
+<p>Of course I do not at all intend to reject <i>en bloc</i> the ideas generally
+agreed upon concerning the urban economy of the Middle Ages. On the
+contrary, I believe them to be entirely accurate in their essential
+elements, and I am persuaded that, in a very large number of cases, I
+will even say, if you like, in the majority of cases, they provide us
+with a theory which is completely satisfactory. I am very far from
+maintaining that capitalism exercised a preponderant influence on the
+character of economic organization from the twelfth to the fifteenth
+centuries. I believe that, though it is not right to call this
+organization "acapitalistic", it is on the other hand correct to
+consider it "anticapitalistic". But to affirm this is to affirm the
+existence of capital. That organization recognized the existence of
+capital since it tried to defend itself against it, since, from the end
+of the thirteenth century onward, it took more and more measures to
+escape from its abuses. It is incontestable that, from this period on,
+it succeeded by legal force in diminishing the r&ocirc;le which capitalism had
+played up to that time. In fact it is certain, and we shall have
+occasion to observe it, that the power of capital was much greater
+during the first part of the urban period of the Middle Ages than during
+the second. But even in the course of the latter period, if municipal
+legislation seems more or less completely to have shut it out from local
+markets, capital succeeded in preserving and in dominating a very
+considerable portion of economic activity. It is capital which rules in
+inter-local commerce, which determines the forms of credit, and which,
+fastening itself on all the industries which produce not for the city
+market but for exportation, hinders them from being controlled, as the
+others are, by the minute regulations which in innumerable ways cramp
+the activity of the craftsmen.<a name="FNanchor_8_8" id="FNanchor_8_8"></a><a href="#Footnote_8_8" class="fnanchor">[8]</a></p>
+
+<p>Let us recognize, then, that capitalism is much older than we have
+ordinarily thought it. No doubt its operation in modern times has been
+much more engrossing than in the Middle Ages. But that is only a
+difference of quantity, not a difference of quality, a simple difference
+of intensity not a difference of nature. Therefore, we<span class='pagenum'><a name="Page_5" id="Page_5"></a>[<a href="images/007.png">5</a>]</span> are justified in
+setting the question we set at the beginning. We can, without fear of
+pursuing a vain shadow, endeavor to discern what throughout history have
+been the successive stages in the social evolution of capitalism.</p>
+
+<p>Of the period which preceded the formation of towns, that is, of the
+period preceding the middle of the eleventh century, we know too little
+to permit ourselves to tarry there. What may still have survived in
+Italy and in Gaul of the economic system of the Romans has disappeared
+before the beginning of the eighth century. Civilization has become
+strictly agricultural and the domain system has impressed its form upon
+it. The land, concentrated in large holdings in the hands of a powerful
+landed aristocracy, barely produces what is necessary for the proprietor
+and his <i>familia</i>. Its harvests do not form material for commerce. If
+during years of exceptional abundance the surplus is transported to
+districts where scarcity prevails, that is all. In addition certain
+commodities of ordinary quick consumption, and which nature has
+distributed unequally over the soil, such as wine or salt, sustain a
+sort of traffic. Finally, but more rarely, products manufactured by the
+rural industry of countries abounding in raw materials, such as, to cite
+only one, the friezes woven by the peasants of Flanders, maintain a
+feeble exportation. Of the condition of the <i>negociatores</i> who served as
+the instruments of these exchanges, we know almost nothing. Many of them
+were unquestionably merchants of occasion, men without a country, ready
+to seize on any means of existence that came their way. Pursuers of
+adventure were frequent among these roving creatures, half traders, half
+pirates, not unlike the Arab merchants who even to our day have searched
+for and frequently have found fortunes amid the negro populations of
+Africa. At least, to read the history of that Samo who at the beginning
+of the eighth century, arriving at the head of a band of adventuring
+merchants among the Wends of the Elbe, ended by becoming their king,
+makes one think involuntarily of certain of those beys or sheiks
+encountered by voyagers to the Congo or the Katanga.<a name="FNanchor_9_9" id="FNanchor_9_9"></a><a href="#Footnote_9_9" class="fnanchor">[9]</a> Clearly no one
+will try to find in this strong and fortunate bandit an ancestor of the
+capitalists of the future. Commerce, as he understood and practised it,
+blended with plunder, and if he loved gain it was not in the manner of a
+man of affairs but rather in that of a primitive conqueror with whom
+violence of appetite took the place of calculation. Samo was evidently
+an exception. But the spirit which inspired him may have inspired a
+goodly number of <i>negociatores</i> who<span class='pagenum'><a name="Page_6" id="Page_6"></a>[<a href="images/008.png">6</a>]</span> launched their barks on the streams
+of the ninth century. In the society of this period only the possession
+of land or attachment to the following of a great man could give one a
+normal position. Men not so provided were outside the regular
+classification, forming a confused mass, in which were promiscuously
+mingled professional beggars, mercenaries in search of employment,
+masters of barges or drivers of wagons, peddlers, traders, all jostling
+in the same sort of hazardous and precarious life, and all no doubt
+passing easily from one employment to another. This is not to say,
+however, that among the <i>negociatores</i> of the Frankish epoch there were
+not also individuals whose situation was more stable and whose means of
+existence were less open to suspicion. Indeed, we know that the great
+proprietors, lay or ecclesiastical, employed certain of their serfs or
+of their <i>ministeriales</i> in a sporadic commerce of which we have already
+mentioned above the principal features. They commissioned them to buy at
+neighboring markets the necessary commodities or to transport to places
+of sale the occasional surplus of their grain or their wine. Here too we
+discover no trace of capitalism. We merely find ourselves in the
+presence of hereditary servants performing gratuitous service, entirely
+analogous to military service.</p>
+
+<p>Nevertheless commercial intercourse produced even then, in certain
+places particularly favored by their geographic situation, groups of
+some importance. We find them along the sea-coast&mdash;Marseilles, Rouen,
+Quentovic&mdash;or on the banks of the rivers, especially in those places
+where a Roman road crosses the stream, as at Maastricht on the Meuse or
+at Valenciennes on the Scheldt. We are to think of these <i>portus</i> as
+wharves for merchandise and as winter quarters for boats and boatmen.
+They differ very distinctly from the towns of the following period. No
+walls surround them; the buildings which are springing up seem to be
+scarcely more than wooden sheds, and the population which is found there
+is a floating population, destitute of all privileges and forming a
+striking contrast to the bourgeoisie of the future. No organization
+seems to have bound together the adventurers and the voyagers of these
+<i>portus</i>. Doubtless it is possible, it is even probable, that a certain
+number of individuals, profiting by circumstance, may have little by
+little devoted themselves to trade in a regular fashion and have begun
+by the ninth century to form the nucleus of a group of professional
+traders. But we have too little information to enable us to speak with any precision.</p>
+
+<p>The operations of credit follow much the same course. We cannot doubt
+that loans had been employed in the Carolingian period, and the Church
+as well as the State had occupied itself in combating<span class='pagenum'><a name="Page_7" id="Page_7"></a>[<a href="images/009.png">7</a>]</span> their abuses.<a name="FNanchor_10_10" id="FNanchor_10_10"></a><a href="#Footnote_10_10" class="fnanchor">[10]</a>
+But it would be a manifest exaggeration to deduce from this the
+existence of even a rudimentary capitalistic economy. Everything
+indicates that the loans which we are considering here were only
+occasional loans, of usurious nature, to which people who had met with
+some catastrophe, such as war, a fire, or a poor harvest, were forced to
+have recourse temporarily.</p>
+
+<p>Thus, the early centuries of the Middle Ages seem to have been
+completely ignorant of the power of capital. They abound in wealthy
+landed proprietors, in rich monasteries, and we come upon hundreds of
+sanctuaries the treasure of which, supplied by the generosity of the
+nobles or the offerings of the faithful, crowds the altar with ornaments
+of gold or of solid silver. A considerable fortune is accumulated in the
+Church, but it is an idle fortune. The revenues which the landowners
+collect from their serfs or from their tenants are directed toward no
+economic purpose. They are scattered in alms, in the building of
+monuments, in the purchase of works of art, or of precious objects which
+should serve to increase the splendor of religious ceremonies. Wealth,
+capital, if one may so term it, is fixed motionless in the hands of an
+aristocracy, priestly or military. This is the essential condition of
+the patronage that this aristocracy (<i>majores et divites</i>) exercises
+over the people (<i>pauperes</i>). Its action is as important from the social
+point of view as it is unimportant from that of economics. No part of it
+is directed toward the <i>negociatores</i>, who, left to themselves, live, so
+to speak, on the fringe of society. And so it will continue to be, for long centuries.</p>
+
+<p>Landed property, indeed, did not contribute at all to that awakening of
+commercial activity which, after the disasters of the Norman invasion in
+the North and the Saracen raids on the shores of the Mediterranean,
+began to manifest itself toward the end of the tenth century and the
+beginning of the eleventh. Its preliminary manifestations are found at
+the two extremities of the Continent, Italy and the Low Countries. The
+interior seas, between which Europe was restricted in her advance toward
+the Atlantic, were its first centres of activity. Venice, then Genoa and
+Pisa, venture on the coasting trade along their shores, and then
+maintain, with their rich neighbors of Byzantium or of the Mohammedan
+countries, a traffic which henceforward constantly increases. Meanwhile
+Bruges at the head of the estuary of the Zwyn, becomes the centre of a
+navigation<span class='pagenum'><a name="Page_8" id="Page_8"></a>[<a href="images/010.png">8</a>]</span> radiating toward England, the shores of North Germany, and
+the Scandinavian regions. Thus, economic life, as in the beginning of
+Hellenic times, first becomes active along the coasts. But soon it
+penetrates into the interior of the country. Step by step it wins its
+way along the rivers and the natural routes. On this side and on that,
+it arouses the hinterland into which the harbors cut their indentations.
+In this process of growth the two movements finally meet, and bring into
+communication the people of the North and the people of the South. By
+the beginning of the twelfth century it is an accomplished fact. In 1127
+Lombard merchants, journeying by the long route which descends from the
+passes of the Alps toward Champagne and the Low Countries, reach the fairs of Flanders.</p>
+
+<p>If the feeble and precarious commercial activity of the Carolingian
+period was sufficient to create gathering-places of merchants at the
+points most frequented in travel, it is not difficult to understand that
+the steady progress of economic activity from the end of the tenth
+century would result in the formation, at the strategic points of
+regional transit, of aggregations of like character but much more
+important and more stable. The surface of the land, the direction and
+the depth of the streams, determining the routes of commerce, also
+determined the location of the towns. Indeed, European cities are the
+daughters of commerce and of industry. Unquestionably in the countries
+of old civilization, in Italy or in Gaul, the Roman cities had not
+completely disappeared. Within the circle of their walls, which had now
+become too large and were filled with ruins, there gathered, around the
+bishop resident in each of them, a whole population of clerics and
+monks, and beside them a lay population employed in their service or
+support. In the North, one found the same spectacle at the centres of
+the new dioceses, at Th&eacute;rouanne, at Utrecht, at Magdeburg, or at Vienna.
+But here was no trace, properly speaking, of municipal life. A certain
+number of artisans, some of them serfs, a little weekly market for the
+most indispensable commodities, sometimes a fair visited by the
+merchant-adventurers of whom we have spoken above&mdash;this is the sum total
+of economic life.</p>
+
+<p>But the situation changes from the moment when the increasing intensity
+of commerce begins to furnish men with new means of existence.
+Immediately one discovers an uninterrupted movement of migration of
+peasants from the country towards the places in which the handling of
+merchandise, the towing of boats, the service of merchants furnish
+regular occupations and arouse the hope of gain.</p>
+
+<p>If the old cities disadvantageously placed at one side from the highways
+of travel continue in their torpor, the others see their<span class='pagenum'><a name="Page_9" id="Page_9"></a>[<a href="images/011.png">9</a>]</span> population
+increase continuously. Suburbs join the old enclosure; new markets are
+established; new churches are built for the new comers; and soon the
+primitive nucleus of the town, surrounded on all sides by the houses of
+the immigrants, becomes merely the quarter of the priests, bound to the
+shadow of the cathedral and submerged on all sides by the expansion of
+lay life. Much that at the beginning was the essential is now nothing
+more than the accessory. The episcopal burg disappears amid
+faubourgs.<a name="FNanchor_11_11" id="FNanchor_11_11"></a><a href="#Footnote_11_11" class="fnanchor">[11]</a> The city has not been formed by growing with its own
+forces. It has been brought into existence by the attraction which it
+has exerted upon its surroundings whenever it has been aided by its
+situation. It is the creation of those who have migrated toward it. It
+has been made from without and not from within. The bourgeoisie of the
+oldest towns of Europe is a population of the transplanted. But it is at
+the same time essentially a trading population, and no other proof of
+this need be advanced than the fact that, down to the beginning of the
+twelfth century, <i>mercator</i> and <i>burgensis</i> were synonymous terms.</p>
+
+<p>Whence came these pioneers of commerce, these immigrants seeking means
+of subsistence, and what resources did they bring with them into the
+rising towns? Doubtless only the strength of their arms, the force of
+their wills, the clearness of their intelligence. Agricultural life
+continued to be the normal life and none of those who remained upon the
+soil could entertain the idea of abandoning his holding to go to the
+town and take his chances in a new existence. As for selling the holding
+to get ready money, like the men of a modern rural population, no one at
+that time could have imagined such a transaction. The ancestors of the
+bourgeoisie must then be sought, specifically, in the mass of those
+wandering beings who, having no land to cultivate, floated across the
+surface of society, living from day to day upon the alms of the
+monasteries, hiring themselves to the cultivators of the soil in harvest
+time, enlisting in the armies in time of war, and shrinking from neither
+pillage nor rapine if the occasion presented itself. It may without
+difficulty be admitted that there may have been among them some rural
+artisans or some professional peddlers. But it is beyond question that
+with very few exceptions it was poor men who floated to the towns and
+there built up the first fortunes in movable property that the Middle Ages knew.</p>
+
+<p><span class='pagenum'><a name="Page_10" id="Page_10"></a>[<a href="images/012.png">10</a>]</span></p><p>Fortunately we possess certain narratives which enable us to support
+this thesis with concrete examples. It will suffice to cite here the
+most characteristic of them, the biography of St. Godric of
+Finchale.<a name="FNanchor_12_12" id="FNanchor_12_12"></a><a href="#Footnote_12_12" class="fnanchor">[12]</a></p>
+
+<p>He was born of poor peasants in Lincolnshire, toward the end of the
+eleventh century, and from infancy was forced to tax his ingenuity to
+find the means of livelihood. Like many other unfortunates of all times,
+he at first walked the beaches on the outlook for wreckage cast up by
+the sea. Then we see him, perhaps by reason of some fortunate find,
+setting up as a peddler and travelling through the country with a little
+pack of goods (<i>cum mercibus minutis</i>). At length he gathers together a
+small sum, and one fine day joins a troop of town merchants whom he has
+met in the course of his wanderings. Thenceforward he goes with his
+companions from market to market, from fair to fair, from town to town.
+Having thus become a professional merchant, he rapidly gains a
+sufficient sum to enable him to associate himself with other merchants,
+charter a boat with them, and engage in the coasting trade along the
+shores of England, Scotland, Denmark, and Flanders. The company is
+highly successful. Its operations consist in carrying to a foreign
+country goods which it knows to be uncommon there, in selling them there
+at a high price, and acquiring in exchange various merchandise which it
+takes pains to dispose of in the places where the demand for them is
+greatest and where it can consequently make the greatest gains. At the
+end of some years this prudent practice of buying cheap and selling dear
+has made of Godric, and doubtless of his associates, a man of important
+wealth. Then, touched by divine grace, he suddenly renounces his
+fortune, gives his goods to the poor, and becomes a monk.</p>
+
+<p>The story of Godric, if one omits its pious conclusion, must have been
+that of many others. It shows us, with perfect clearness, how a man
+beginning with nothing might in a relatively short time amass a
+considerable capital. Our adventurer must have been favored by
+circumstances and chance. But the secret of his success, and the
+contemporary biographer to whom we owe the story insists strongly upon
+it, is intelligence.<a name="FNanchor_13_13" id="FNanchor_13_13"></a><a href="#Footnote_13_13" class="fnanchor">[13]</a> Godric in fact shows himself a calculator, I
+might even say a speculator. He has in a high degree the feeling, and it
+is much more developed among minds without culture than is usually
+thought, for what is practicable in commerce. He is on fire<span class='pagenum'><a name="Page_11" id="Page_11"></a>[<a href="images/013.png">11</a>]</span> with the
+love of gain. One sees clearly in him that famous <i>spiritus
+capitalisticus</i> of which some would have us believe that it dates only
+from the time of the Renaissance. Here is an eleventh-century merchant,
+associated with companions like himself, combining his purchases,
+reckoning his profits, and, instead of hiding in a chest the money he
+has gained, using it only to support and extend his business. More than
+this, he does not hesitate to devote himself to operations which the
+Church condemns. He is not disquieted by the theory of the just price;
+the Decretum of Gratian disapproves in express terms of the speculations
+which he practises: "Qui comparat rem ut illam ipsam integram et
+immutatam dando lucretur, ille est mercator qui de templo Dei ejicitur".</p>
+
+<p>After this, how can we see, in Godric and any of those who led the same
+sort of life, anything else but capitalists? It is impossible to
+maintain that these men conducted business only to supply their daily
+wants, impossible not to see that their purpose is the constant
+accumulation of goods, impossible to deny that, barbarous as we may
+suppose them, they none the less possessed the comprehension, or, if one
+prefers, had the instinct for commerce on the large scale.<a name="FNanchor_14_14" id="FNanchor_14_14"></a><a href="#Footnote_14_14" class="fnanchor">[14]</a> Of the
+organization of this commerce the life of Godric shows us already the
+principal features, and the description which it gives us of them is the
+more deserving of confidence because it is corroborated in the most
+convincing fashion by many documents. It shows us, first of all, the
+merchant coming from the country to establish himself in the town. But
+the town is to him, so to speak, merely a basis of operations. He lives
+there but little, save in the winter. As soon as the roads are
+practicable and the sea open to navigation, he sets out. His commerce is
+essentially a wandering commerce, and at the same time a collective one,
+for the insecurity of the roads and the powerlessness of the solitary
+individual compel him to have recourse to association. Grouped in gilds,
+in hanses, in <i>caritates</i>, the associates take their merchandise in
+convoy from town to town, presenting a spectacle entirely like that
+which the caravans of the East still furnish in our day. They buy and
+sell in common, dividing the profits in the ratio of their respective
+investments in the expedition, and the trade they carry on in the
+foreign markets is wholesale trade, and can only be that, for retail
+trade, as the life of Godric shows us, is left to the rural peddlers. It
+is in gross that they export and import wine, grain, wool, or cloth. To
+convince ourselves of this we need only examine the regulations which
+have been<span class='pagenum'><a name="Page_12" id="Page_12"></a>[<a href="images/014.png">12</a>]</span> preserved to us. The statutes of the Flemish hanse of London,
+for example, formally exclude retail dealers and craftsmen from the company.</p>
+
+<p>Moreover, the merchant associations of the eleventh and twelfth
+centuries have nothing exclusively local in their character. In them we
+find bourgeoisie of different towns, side by side. They have rather the
+appearance of regional than of urban organisms. They are still far from
+the exclusivism and the protectionism which are to be shown with so much
+emphasis in the municipal life of the fourteenth century. Commercial
+freedom is not troubled by any restrictive regulations. Public authority
+assigns no limits to the activity of the merchants, does not restrict
+them to this or that kind of business, exercises no supervision over
+their operations. Provided they pay the fiscal dues (<i>teloneum,
+conductus</i>, etc.) levied by the territorial prince and the seigneurs
+having jurisdiction at the passage of the bridges, along the roads and
+rivers, or at the markets, they are entirely free from all legal
+obstacles. The only restrictions which hinder the full expansion of
+commerce do not come from the official authority, but result from the
+practices of commerce itself. To wit, the various merchant associations,
+gilds, hanses, etc., which encounter each other at the places of buying
+and selling, oppose each other in brutal competition. Each of them
+excludes from all participation in its affairs the members of all the
+others. But this is merely a state of facts, resting on no legal title.
+Force holds here the place of law, and whatever may be the differences
+of time and of environment, one cannot do otherwise than to compare the
+commerce of the eleventh and twelfth centuries to that bloody
+competition in which, in the sixteenth and seventeenth centuries, the
+sailors of Holland, England, France, and Spain engaged in the markets of
+the New World. We shall conclude then that medieval commerce, at its
+origin, is essentially characterized by its regional quality and by its
+freedom. And it is not difficult to understand that it was so, if one
+bears in mind two facts to which attention should be drawn.</p>
+
+<p>In the first place, down to the end of the twelfth century, the number
+of towns properly so-called was relatively small. Only those places that
+were favored by a privileged geographical situation attracted the
+merchants in sufficient number to enable them to maintain a commercial
+movement of real importance. After that the attraction which these
+centres of business exerted upon their environs was much greater than is
+ordinarily imagined. All the secondary localities were subject to their
+influence. The merchants dwelling in these last, too few to act by
+themselves, affiliated themselves to the hanse or gild of the principal
+town. The Flemish<span class='pagenum'><a name="Page_13" id="Page_13"></a>[<a href="images/015.png">13</a>]</span> hanse, which we have already instanced, proves this
+fully, by showing us the merchants of Dixmude, Damme, Oudenbourg,
+Ardenbourg, etc., seeking admission into the hanse of Bruges.</p>
+
+<p>In the second place, at the period we have now reached the towns devoted
+themselves far more to commerce than to industry. Few could be cited
+that appear thus early as manufacturing centres. The concentration of
+artisans within their walls is still incomplete. If their merchants
+export, along with the products of the soil, such as wine and grain, a
+quantity of manufactured products, such, for example, as cloth, it is
+more than probable that these were for the most part made in the country.</p>
+
+<p>Admit these two statements, and the nature of early commerce is
+explained without difficulty. They account in fact both for the freedom
+of the merchants and for that character of wholesale exporters which
+they exhibit so clearly and which prevents our placing them in the
+category in which the theory of urban economy claims to confine them.
+Contrary to the general belief, it appears then that before the
+thirteenth century we find a period of free capitalistic expansion. No
+doubt the capitalism of that time is a collective capitalism: groups,
+not isolated individuals, are its instruments. No doubt too it contents
+itself with very simple operations. The commercial expeditions upon
+which its activity especially centres itself demand, for their
+successful conduct, an endurance, a physical strength, which the more
+advanced stages of economic evolution will not require. But they demand
+nothing more. Without the ability to plan and combine they would remain
+sterile. And so we can see that, from the beginning, what we find at the
+basis of capitalism is intelligence, that same intelligence which Georg
+Hansen has so well shown, long ago, to be the efficient cause of the
+emergence of the bourgeoisie.<a name="FNanchor_15_15" id="FNanchor_15_15"></a><a href="#Footnote_15_15" class="fnanchor">[15]</a></p>
+
+<p>The fortunes acquired inn the wandering commerce by the parvenus of the
+eleventh and twelfth centuries soon transformed them into landed
+proprietors. They invest a good part of their gains in lands, and the
+land they thus acquire is naturally that of the towns in which they
+reside. From the beginning of the thirteenth century one sees this land
+held in large parcels by an aristocracy of patricians, <i>viri
+hereditarii</i>, <i>divites</i>, <i>majores,</i> in whom we cannot fail to recognize
+the descendants of the bold voyagers of the gilds and the hanses. The
+continuous increase of the burghal population enriches them more and
+more, for as new inhabitants establish themselves in the towns, and as
+the number of the houses increases, the rent of the ground increases in
+proportion. So, from the commencement<span class='pagenum'><a name="Page_14" id="Page_14"></a>[<a href="images/016.png">14</a>]</span> of the thirteenth century, the
+grandsons of the primitive merchants abandon commerce and content
+themselves with living comfortably upon the revenue of their lands. They
+bid farewell to the agitations and the chances of the wandering life.
+They live henceforward in their stone houses, whose battlements and
+towers rise above the thatched roofs of the wooden houses of their
+tenants. They assume control of the municipal administration; they and
+their families monopolize the seats in the <i>&eacute;chevinage</i> or the town
+council. Some even, by fortunate marriages, ally themselves with the
+lesser nobility and begin to model their manner of living upon that of the knights.</p>
+
+<p>But while these first generations of capitalists are retiring from
+commerce and rooting themselves in the soil, important changes are going
+on in the economic organization. In the first place, in proportion as
+the wealth of the towns increases, and with it their attractive power,
+they take on more and more an industrial character, the rural artisans
+flocking into them <i>en masse</i> and deserting the country. At the same
+time, many of them, favored by the abundance of raw material furnished
+by the surrounding region, begin to devote themselves to certain
+specialties of manufacture&mdash;cloth-making or metallurgy. Finally, around
+the principal aggregations many secondary localities develop, so that
+all Western Europe, in the course of the thirteenth century, blossoms
+forth in an abundance of large and small towns. Some, and much the
+greater number of them, content themselves perforce with local commerce.
+Their production is determined by the needs of their population and that
+of the environs which extend two or three leagues around their walls
+and, in exchange for the manufactured articles which the city furnishes
+to them, attend to the food supply of the urban inhabitants. Other
+towns, on the contrary, less closely set together but also more
+powerful, develop chiefly by means of an export industry, producing, as
+did the cloth industry of great Flemish or Italian cities, not for their
+local market,<a name="FNanchor_16_16" id="FNanchor_16_16"></a><a href="#Footnote_16_16" class="fnanchor">[16]</a> but for the European market, constantly extensible.
+Others still, profiting by the advantages of nearness to the sea, give
+themselves up to navigation and to transportation, as did so many ports
+of Italy, of France, of England, and especially of North Germany.</p>
+
+<p>Of these two types of towns, the one sufficient to themselves, the other
+living upon the outside world, it is unquestionably the first to which
+the theory of the urban economy applies. Direct trade<span class='pagenum'><a name="Page_15" id="Page_15"></a>[<a href="images/017.png">15</a>]</span> between purchaser
+and consumer, strict protectionism excluding the foreigner from the
+local market and reserving it to the bourgeoisie alone, minute
+regulations confining within narrow limits the industry of the merchant
+and the artisan; in a word, all the traits of an organization evidently
+designed to preserve and safeguard the various members of the community
+by assigning to each his place and his r&ocirc;le, are all found and all
+explained without difficulty in those towns which are confined to a
+clientage limited by the extent of their suburban dependencies. In these
+one can rightly speak of an anti-capitalistic economy. In these we find
+neither great <i>entrepreneurs</i> nor great merchants. It is true that the
+necessity of stocking the town with commodities which it does not
+produce or cannot find in its environs&mdash;groceries, fine cloths, wines in
+northern countries&mdash;brings into existence a group of exporters whose
+condition is superior to that of their fellow-citizens. But on
+inspection they cannot be regarded as a class of great professional
+merchants. If they buy at wholesale in foreign markets, it is to sell at
+retail to their fellow-citizens. They dispose of their goods piecemeal,
+and like the <i>Gewandschneider</i> of the German towns, they do not rise
+above the level of large shopkeepers.<a name="FNanchor_17_17" id="FNanchor_17_17"></a><a href="#Footnote_17_17" class="fnanchor">[17]</a></p>
+
+<p>In the towns of the second category we find a quite different condition.
+Here capitalism not only exists but develops toward perfection.
+Instruments of credit, such as the <i>lettre de foire,</i> make their
+appearance; a traffic in money takes its place alongside the traffic in
+merchandise and, despite the prohibition of loans at interest, makes
+constantly more rapid progress. The <i>coutumes</i> of the fairs, especially
+those of the fairs of the Champagne, in which the merchants of the
+regions most advanced in an economic sense, Italy and the Low Countries,
+meet each other, give rise to a veritable commercial law. The
+circulation of money expands and becomes regulated; the coinage of gold,
+abandoned since the Merovingian period, is resumed in the middle of the
+thirteenth century. The security of travellers increases on the great
+highways. The old Roman bridges are rebuilt and here and there canals
+are built and dykes constructed. Finally, in the towns, the commercial
+buildings of the previous period, outgrown, are replaced by structures
+more vast and more luxurious, of which the <i>halles</i> of Ypres, with their
+fa&ccedil;ade one hundred and thirty-three metres long, is doubtless the most imposing specimen.</p>
+
+<p>In the presence of these facts it is impossible to deny the existence of
+a considerable traffic. Moreover documents abound which<span class='pagenum'><a name="Page_16" id="Page_16"></a>[<a href="images/018.png">16</a>]</span> attest the
+existence in the great cities of men of affairs who hold the most
+extended relations with the outside world, who export and import sacks
+of wool, bales of cloth, tuns of wine, by the hundred, who have under
+their orders a whole corps of factors or "sergents" (<i>servientes</i>,
+<i>valets</i>, etc.), whose letters of credit are negotiated in the fairs of
+Champagne, and who make loans amounting to several thousands of livres
+to princes, monasteries, and cities in need of money. To cite here
+merely a few figures, let us recall that in 1273 the company of the
+Scotti of Piacenza exports wool from England to the value of 21,400
+pounds sterling, or 1,600,000 francs (metallic value);<a name="FNanchor_18_18" id="FNanchor_18_18"></a><a href="#Footnote_18_18" class="fnanchor">[18]</a> in 1254
+certain burgesses of Arras furnish 20,000 livres to the Count of Guines,
+prisoner of the Count of Flanders, to enable him to pay his ransom.<a name="FNanchor_19_19" id="FNanchor_19_19"></a><a href="#Footnote_19_19" class="fnanchor">[19]</a>
+In 1339 three merchants of Mechlin advance 54,000 florins (700,000
+francs) to King Edward III.<a name="FNanchor_20_20" id="FNanchor_20_20"></a><a href="#Footnote_20_20" class="fnanchor">[20]</a></p>
+
+<p>Extensive however as capitalistic commerce has been since the first half
+of the thirteenth century, it no longer enjoys the freedom of
+development which it had before. As we advance toward the end of the
+Middle Ages, indeed, we see it subjected to limitations constantly more
+numerous and more confining. Henceforth, in fact, it has to reckon with
+municipal legislation. Every town now shelters itself behind the
+ramparts of protectionism. If the most powerful cities can no longer
+exclude the stranger, upon whom they live, they impose upon him a minute
+regulation, the purpose of which is to defend against him the position
+of their own citizens. They force him to have recourse in his purchases
+to the mediation of his "hosts" and his "courtiers"; they forbid him to
+bring in manufactured articles which may compete with those which the
+city produces; they exploit him by levying taxes of all sorts: duties
+upon weighing, upon measuring, upon egress, etc.</p>
+
+<p>In those cities especially in which has occurred the popular revolution
+transferring power from the hands of the patriciate into those of the
+craft-gilds, distrust of capital is carried as far as it can go without
+entirely destroying urban industry. The craftsmen who produce for
+exportation&mdash;for example, the weavers and the fullers of the towns of
+Flanders&mdash;try to escape from their subjection, to the merchants who
+employ them. Not only do the municipal statutes fix wages and regulate
+the conditions of work, but they also limit the independence of the
+merchant, even in purely commercial matters. It will be sufficient to
+mention here, as one of their most<span class='pagenum'><a name="Page_17" id="Page_17"></a>[<a href="images/019.png">17</a>]</span> characteristic provisions, the
+forbidding of the cloth merchant to be at the same time a wool merchant,
+a prohibition inspired by the desire to prevent operations that will
+unfavorably affect prices and the workman's wages.<a name="FNanchor_21_21" id="FNanchor_21_21"></a><a href="#Footnote_21_21" class="fnanchor">[21]</a></p>
+
+<p>But it is not solely the municipal authority which attacks the
+speculations born of the capitalistic spirit. The Church steps forward,
+and under the name of usury forbids indiscriminately the lending of
+money at interest, sales on credit, monopolies, and in general all
+profits exceeding the <i>justum pretium</i>. No doubt these prohibitions
+themselves attest the existence of the abuses which they endeavor to
+oppose, and their frequency proves that they did not always succeed. It
+is none the less true that they were very burdensome and that the
+pursuit of business on a large scale found itself much embarrassed by them.</p>
+
+<p>The increasing specialization of commerce embarrassed it much more. At
+the beginning the merchants had devoted themselves to the most various
+operations at once. Wandering from market to market, they bought and
+sold without feeling in need of centring their activity on this or that
+kind of products or commodities, but from about 1250 this is no longer
+the case. The progress of economic evolution has resulted in localizing
+certain industries and in restraining certain branches of commerce to
+the groups of merchants best suited to their promotion. Thus, for
+example, in the course of the thirteenth century the trade in fine cloth
+became a monopoly of the towns of Flanders, and banking a monopoly of
+certain merchant companies of Lombardy, Provence, or Tuscany.
+Thenceforward commercial life ceases to overflow at random, so to speak.
+It has a less arbitrary, a more deliberate, and consequently a more embarrassed quality.</p>
+
+<p>These limitations resting upon commerce have resulted in turning away
+from it the patricians, who moreover have become, as has been said
+above, a class of landed proprietors. The place which they left vacant
+is filled by new men, among whom, as among their predecessors,
+intelligence is the essential instrument of fortune. The intellectual
+faculties which the first developed in wandering commerce are used by
+these later men to overcome the obstacles raised in their pathway by
+municipal regulations of commerce and ecclesiastical regulations in
+respect to money affairs.<a name="FNanchor_22_22" id="FNanchor_22_22"></a><a href="#Footnote_22_22" class="fnanchor">[22]</a> Many of them find a rich source of profit
+by devoting themselves to brokerage. Others<span class='pagenum'><a name="Page_18" id="Page_18"></a>[<a href="images/020.png">18</a>]</span> in the industrial cities
+exploit shamelessly and in defiance of the statutes the artisans whom
+they employ. At Douai, for example, Jehan Boinebroke (1280-1310)
+succeeds in reducing to serfdom a number of workers (and
+characteristically, they are chiefly women) by advancing wool or money
+which they are unable to repay, and which therefore place them at his
+mercy.<a name="FNanchor_23_23" id="FNanchor_23_23"></a><a href="#Footnote_23_23" class="fnanchor">[23]</a> The richest or the boldest profit by the constantly
+increasing need of money on the part of territorial princes and kings,
+to become their bankers. It will be remembered that it was Lombard
+capitalists who furnished Edward III. with money to prepare his
+campaigns against France,<a name="FNanchor_24_24" id="FNanchor_24_24"></a><a href="#Footnote_24_24" class="fnanchor">[24]</a> and, quite recently, the history of
+Guillaume Servat of Cahors (1280-1320) has shown us a man who, setting
+out with nothing, like Godric in the eleventh century, accumulates in a
+few years a considerable fortune, supplies the King of England with a
+dowry for one of his daughters, lends money to the King of Norway, farms
+the wool duties at London, and, unscrupulous as he is shrewd, does not
+hesitate to engage in shady speculations upon the coinage.<a name="FNanchor_25_25" id="FNanchor_25_25"></a><a href="#Footnote_25_25" class="fnanchor">[25]</a> And how
+many other financiers do we not know whose career is wholly similar:
+Thomas Fin at the court of the counts of Flanders,<a name="FNanchor_26_26" id="FNanchor_26_26"></a><a href="#Footnote_26_26" class="fnanchor">[26]</a> the Berniers at
+that of the counts of Hainaut, the Tote Guis, the Vane Guis, at that of
+the kings of France, not to name the numberless Italians entrusted by
+the popes with the various operations of pontifical finance, those
+<i>mercatores Romanam curiam sequentes</i> among whom are found the ancestors
+of the great Medici of the fifteenth century.<a name="FNanchor_27_27" id="FNanchor_27_27"></a><a href="#Footnote_27_27" class="fnanchor">[27]</a></p>
+
+<p>In the course of the fifteenth century this second class of capitalists,
+courtiers, merchants, and financiers, successors to the capitalists of
+the hanses and the gilds, is in its turn drawn along toward the downward
+grade. The progress of navigation, the discoveries made by the
+Portuguese, then by the Spaniards, the formation of great monarchical
+states struggling for supremacy, begin to destroy the economic situation
+in the midst of which that class had grown to<span class='pagenum'><a name="Page_19" id="Page_19"></a>[<a href="images/021.png">19</a>]</span> greatness, and to which
+it had adapted itself. The direction of the currents of commerce is
+altered. In the north, the English and Dutch marine gradually take the
+place of the hanses. In the Mediterranean, commerce centres itself at
+Venice and at Genoa. On the shores of the Atlantic, Lisbon becomes the
+great market for spices, and Antwerp, supplanting Bruges, becomes the
+rendezvous of European commerce. The sixteenth century sees this
+movement grow more rapid. It is favored at once by moral, political, and
+economic causes; the intellectual progress of the Renaissance, the
+expansion of individualism, great wars exciting speculation, the
+disturbance of monetary circulation caused by the influx of precious
+metals from the New World. As the science of the Middle Ages disappears
+and the humanist takes the place of the scholastic, so a new economy
+rises in the place of the old urban economy. The state subjects the
+towns to its superior power. It restrains their political autonomy at
+the same time that is sets commerce and industry free from the
+guardianship which the towns have hitherto imposed upon them. The
+protectionism and the exclusiveness of the bourgeoisies are brought to
+an end. If the craft-guilds continue to exist, yet they no longer
+control the organization of labor. New industries appear, which, to
+escape the meddling surveillance of the municipal authorities, establish
+themselves in the country. Side by side with the old privileged towns,
+which merely vegetate, younger manufacturing centres, full of strength
+and exuberance, arise; in England, Sheffield, and Birmingham, in
+Flanders, Hondschoote and Armenti&egrave;res.<a name="FNanchor_28_28" id="FNanchor_28_28"></a><a href="#Footnote_28_28" class="fnanchor">[28]</a></p>
+
+<p>The spirit in which is now manifested in the world of business, is that
+same spirit of freedom which animates the intellectual world. In a
+society in process of formation, the individual, enfranchised, gives the
+rein to his boldness. He despises tradition, gives himself up with
+unrestrained delight to his virtuosity. There are to be no more limits
+on speculation, no more fetters on commerce, no more meddling of
+authority in relations between employers and employed. The most skillful
+wins. Competition, up to this time held in check, runs riot. In a few
+years enormous fortunes are built up, others are swallowed up in
+resounding bankruptcies. The Antwerp exchange is a pandemonium where
+bankers, deep-sea sailors, stock-jobbers, dealers in futures,
+millionaire merchants, jostle each other&mdash;and sharpers and adventurers
+to whom all means of money-getting, even assassination, are acceptable.</p>
+
+<p>This confused recasting of the economic world transfers the r&ocirc;le played
+by the capitalists of the late Middle Ages in a class of new<span class='pagenum'><a name="Page_20" id="Page_20"></a>[<a href="images/022.png">20</a>]</span> men. Few
+are the descendants of the business men of the fourteenth century among
+those of the fifteenth and sixteenth. Thrown out of their course by the
+current of events, they have not been willing to risk fortunes already
+acquired. Most of them are seen turning toward administrative careers,
+entering the service of the state as members of the councils of justice
+or finance and aspiring to the <i>noblesse de robe</i>, which, with the aid
+of fortunate marriages, will land their sons in the circle of the true
+nobility. As for the new rich of the period, they almost all appear to
+us like parvenus. Jacques C&oelig;ur is a parvenu in France. The Fugger and
+many other German financiers&mdash;the Herwarts, the Seilers, the Manlichs,
+the Haugs&mdash;are parvenus of whose families we know little before the
+fifteenth century, and so are the Frescobaldi and the Gualterotti of
+Florence, or that Gaspar Ducci of Pistoia who is perhaps the most
+representative of the fortune-hunters of the period.<a name="FNanchor_29_29" id="FNanchor_29_29"></a><a href="#Footnote_29_29" class="fnanchor">[29]</a> Later, when
+Amsterdam has inherited the commercial hegemony of Antwerp, the
+importance of the parvenus characterizes it not less clearly. We may
+merely mention here, among the first makers of its greatness, Willem
+Usselinx,<a name="FNanchor_30_30" id="FNanchor_30_30"></a><a href="#Footnote_30_30" class="fnanchor">[30]</a> Balthazar de Moucheron, Isaac Lemaire. And if from the
+world of commerce we turn toward that of industry the aspect is the
+same. Christophe Plantin, the famous printer, is the son of a simple peasant of Touraine.</p>
+
+<p>The exuberance of capitalism which reached its height in the second half
+of the sixteenth century was not maintained. Even as the regulative
+spirit characteristic of the urban economy followed upon the freedom of
+the twelfth century, so mercantilism imposed itself upon commerce and
+industry in the seventeenth and eighteenth centuries. By protective
+duties and bounties on exportation, by subsidies of all sorts to
+manufactures and national navigation, by the acquiring of transmarine
+colonies, by the creation of privileged commercial companies, by the
+inspection of manufacturing processes, by the perfecting of means of
+transportation and the suppression of interior custom-houses, every
+state strives to increase its means of production, to close its market
+to its competitors, and to make the balance of trade incline in its
+favor. Doubtless the idea that "liberty is the soul of commerce" does
+not wholly disappear, but the endeavor is to regulate that liberty
+henceforward in conformity to the interest of the public weal. It is put
+under the control of intendants, of consuls, of chambers of commerce. We
+are entering into the period of national economy.</p>
+
+<p>This was destined to last, as is familiar, until the moment when, in
+England at the end of the eighteenth century, on the Continent in<span class='pagenum'><a name="Page_21" id="Page_21"></a>[<a href="images/023.png">21</a>]</span> the
+first years of the nineteenth, the invention of machinery and the
+application of steam to manufacturing completely disorganized the
+conditions of economic activity. The phenomena of the sixteenth century
+are reproduced, but with tenfold intensity. Merchants accustomed to the
+routine of mercantilism and to state protection are pushed aside. We do
+not see them pushing forward into the career which opens itself before
+them, unless as lenders of money. In their turn, and as we have seen it
+at each great crisis of economic history, they retire from business and
+transform themselves into an aristocracy. Of the powerful houses which
+are established on all hands and which give the impetus to the modern
+industries of metallurgy, of the spinning and weaving of wool, linen,
+and cotton, hardly one is connected with the establishments existing
+before the end of the eighteenth century. Once again, it is new men,
+enterprising spirits, and sturdy characters which profit by the
+circumstances.<a name="FNanchor_31_31" id="FNanchor_31_31"></a><a href="#Footnote_31_31" class="fnanchor">[31]</a> At most, the old capitalists, transformed into landed
+proprietors, play still an active r&ocirc;le in the exploitation of the mines,
+because of the necessary dependence of that industry upon the possessors
+of the soil, but it can be safely affirmed that those who have presided
+over the gigantic progress of international economy, of the exuberant
+activity which now affects the whole world, were, as at the time of the
+Renaissance, parvenus, self-made men. As at the time of the Renaissance,
+again, their belief is in individualism and liberalism alone. Breaking
+with the traditions of the old r&eacute;gime, they take for their motto
+"<i>laissez faire, laissez passer</i>". They carry the consequences of the
+principle to an extreme. Unrestrained competition sets them to
+struggling with each other and soon arouses resistance in the form of
+socialism, among the proletariate that they are exploiting. And at the
+same time that that resistance arises to confront capital, the latter,
+itself suffering from the abuses of that freedom which had enabled it to
+rise, compels itself to discipline its affairs. Cartels, trusts,
+syndicates of producers, are organized, while states, perceiving that it
+is impossible to leave employers and employees longer to contend in
+anarchy, elaborate a social legislation; and international regulations,
+transcending the frontiers of the various countries, begin to be applied to working men.</p>
+
+<p>I am aware how incomplete is this rapid sketch of the evolution of
+capitalism through a thousand years of history. As I said at the<span class='pagenum'><a name="Page_22" id="Page_22"></a>[<a href="images/024.png">22</a>]</span>
+beginning, I present it merely as an hypothesis resting on the very
+imperfect knowledge which we yet possess of the different movements of
+economic development. Yet, in so far as it is exact, it justifies the
+observation I made at the beginning of this study. It shows that the
+growth of capitalism is not a movement proceeding along a straight line,
+but has been marked, rather, by a series of separate impulses not
+forming continuations one of another, but interrupted by crises.</p>
+
+<p>To this first remark may be added two others, which are in a way corollaries.</p>
+
+<p>The first relates to the truly surprising regularity with which the
+phases of economic freedom and of economic regulation have succeeded
+each other. The free expansion of wandering commerce comes to its end in
+the urban economy, the individualistic ardor of the Renaissance leads to
+mercantilism, and finally, to the age of liberalism succeeds our own
+epoch of social legislation.</p>
+
+<p>The second remark, with which I shall close, lies in the moral and
+political rather than the economic field. It may be stated in this form,
+that every class of capitalists is at the beginning animated by a
+clearly progressive and innovating spirit but becomes conservative as
+its activities become regulated. To convince one's self of this truth it
+is sufficient to recall that the merchants of the eleventh and twelfth
+centuries are the ancestors of the bourgeoisie and the creators of the
+first urban institutions; that the business men of the Renaissance
+struggled as energetically as the humanists against the social
+traditions of the Middle Ages; and finally, that those of the nineteenth
+century have been among the most ardent upholders of liberalism. This
+would suffice to prove to us, if we did not know it otherwise, that all
+these have at the beginning been nothing else than parvenus brought into
+action by the transformations of society, embarrassed neither by custom
+nor by routine, having nothing to lose and therefore the bolder in their
+race toward profit. But soon the primitive energy relaxes. The
+descendants of the new rich wish to preserve the situation which they
+have acquired, provided public authority will guarantee it to them, even
+at the price of a troublesome surveillance; they do not hesitate to
+place their influence at its service, and wait for the moment when,
+pushed aside by new men, they shall demand of the state that it
+recognize officially the rank to which they have raised their families,
+shall on their entrance into the nobility become a legal class and no
+longer a social group, and shall consider it beneath them to carry on
+that commerce which in the beginning made their fortunes.</p>
+
+<div class="footnotes"><h3>FOOTNOTES:</h3>
+
+<div class="footnote"><p><a name="Footnote_1_1" id="Footnote_1_1"></a><a href="#FNanchor_1_1"><span class="label">[1]</span></a> This article represents the substance of an address
+delivered at the International Congress of Historical Studies held in
+London, April, 1913.</p></div>
+
+<div class="footnote"><p><a name="Footnote_2_2" id="Footnote_2_2"></a><a href="#FNanchor_2_2"><span class="label">[2]</span></a> First edition in 1893.</p></div>
+
+<div class="footnote"><p><a name="Footnote_3_3" id="Footnote_3_3"></a><a href="#FNanchor_3_3"><span class="label">[3]</span></a> <i>Der Moderne Capitalismus</i> (1902).</p></div>
+
+<div class="footnote"><p><a name="Footnote_4_4" id="Footnote_4_4"></a><a href="#FNanchor_4_4"><span class="label">[4]</span></a> R. Heynen, <i>Zur Entstehung des Capitalismus in Venedig</i>
+(1905).</p></div>
+
+<div class="footnote"><p><a name="Footnote_5_5" id="Footnote_5_5"></a><a href="#FNanchor_5_5"><span class="label">[5]</span></a> H. Sieveking, "Die Capitalistische Entwickelung in den
+Italienischen St&auml;dten des Mittelalters", <i>Vierteljahrschrift f&uuml;r Social-
+und Wirtschaftsgeschichte</i> (1909).</p></div>
+
+<div class="footnote"><p><a name="Footnote_6_6" id="Footnote_6_6"></a><a href="#FNanchor_6_6"><span class="label">[6]</span></a> Davidsohn, <i>Forschungen zur Geschichte von Florenz</i>, III.
+36; A. Doren, <i>Die Florentiner Wollentuchindustrie</i>, p. 481.</p></div>
+
+<div class="footnote"><p><a name="Footnote_7_7" id="Footnote_7_7"></a><a href="#FNanchor_7_7"><span class="label">[7]</span></a> A. Schaube, "Die Wollausfuhr Englands von 1272",
+<i>Vierteljahrschrift f&uuml;r Social- und Wirtschaftsgeschichte</i> (1908), pp. 39
+ff. <i>Cf.</i> F. Keutgen, "Hansische Handelsgesellschaften", <i>ibid.</i> (1906),
+pp. 288 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_8_8" id="Footnote_8_8"></a><a href="#FNanchor_8_8"><span class="label">[8]</span></a> <i>Cf.</i> H. Pirenne, <i>Les Anciennes Democraties des Pays-Bas</i>,
+pp. 11 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_9_9" id="Footnote_9_9"></a><a href="#FNanchor_9_9"><span class="label">[9]</span></a> I. Goll, "Samo und die Karantinischen Slaven",
+<i>Mitteilungen des Instituts f&uuml;r Oesterreichische Geschichtsforschung</i>,
+vol. XI.</p></div>
+
+<div class="footnote"><p><a name="Footnote_10_10" id="Footnote_10_10"></a><a href="#FNanchor_10_10"><span class="label">[10]</span></a> A. Dopsch, <i>Die Wirtschaftsentwickelung der
+Karolingerzeit</i>, II. 274. I cannot, however, accept the thesis of Mr.
+Dopsch on the importance of commerce in the Carolingian period. The
+extremely interesting texts which he has assembled seem to me to
+establish the existence of a sporadic commerce only.</p></div>
+
+<div class="footnote"><p><a name="Footnote_11_11" id="Footnote_11_11"></a><a href="#FNanchor_11_11"><span class="label">[11]</span></a> Of course all the new towns did not grow up around an
+episcopal residence. Many of them, especially in the North and
+particularly in the Low Countries, had as their primitive nucleus a
+fortress (Ghent, Bruges, Ypres, Lille, Douai, etc.). But my purpose here
+is merely to recall the broad outlines of the subject.</p></div>
+
+<div class="footnote"><p><a name="Footnote_12_12" id="Footnote_12_12"></a><a href="#FNanchor_12_12"><span class="label">[12]</span></a> See on this subject the interesting article by W. Vogel,
+"Ein Seefahrender Kaufmann um 1100", <i>Hansische Geschichtsbl&auml;tter</i>
+(1912), pp. 239 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_13_13" id="Footnote_13_13"></a><a href="#FNanchor_13_13"><span class="label">[13]</span></a> "Unde non agriculturae delegit exercitia colere, sed
+potius, quae sagacioris animi sunt, rudimenta studuit arripiendo
+exercere."</p></div>
+
+<div class="footnote"><p><a name="Footnote_14_14" id="Footnote_14_14"></a><a href="#FNanchor_14_14"><span class="label">[14]</span></a> One finds already in the twelfth century lenders of money
+undertaking veritable financial operations. See H. Jenkinson and M. T.
+Stead, "William Cade: a Financier of the Twelfth Century", <i>English
+Historical Review</i> (1913), p. 209 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_15_15" id="Footnote_15_15"></a><a href="#FNanchor_15_15"><span class="label">[15]</span></a> <i>Die drei Bev&ouml;lkerungsstufen.</i></p></div>
+
+<div class="footnote"><p><a name="Footnote_16_16" id="Footnote_16_16"></a><a href="#FNanchor_16_16"><span class="label">[16]</span></a> The <i>Livre de la Vingtaine d'Arras</i> (ed. A. Guesnon) says,
+in speaking of the merchants of that town, in 1222, "Emunt non ad usum
+civitatis, sed ut exportent et discurrant per nondinas longinquas et per
+Lombardiam".</p></div>
+
+<div class="footnote"><p><a name="Footnote_17_17" id="Footnote_17_17"></a><a href="#FNanchor_17_17"><span class="label">[17]</span></a> G. von Below, "Grossh&auml;ndler und Kleinh&auml;ndler im Deutschen
+Mittelalter", <i>Jahrb&uuml;cher f&uuml;r National&ouml;konomie und Statistik</i> (1900).</p></div>
+
+<div class="footnote"><p><a name="Footnote_18_18" id="Footnote_18_18"></a><a href="#FNanchor_18_18"><span class="label">[18]</span></a> A. Schaube, "Die Wollausfuhr Englands vom Jahre 1273",
+<i>Vierteljahrschrift f&uuml;r Social- und Wirtschaftsgeschichte</i> (1908), p.
+183.</p></div>
+
+<div class="footnote"><p><a name="Footnote_19_19" id="Footnote_19_19"></a><a href="#FNanchor_19_19"><span class="label">[19]</span></a> A. Duchesne, <i>Histoire des Maisons de Guines, d'Ardres et
+de Gand</i>, p. 289.</p></div>
+
+<div class="footnote"><p><a name="Footnote_20_20" id="Footnote_20_20"></a><a href="#FNanchor_20_20"><span class="label">[20]</span></a> Rymer, <i>Foedera</i>, vol. II., part IV., p. 49.</p></div>
+
+<div class="footnote"><p><a name="Footnote_21_21" id="Footnote_21_21"></a><a href="#FNanchor_21_21"><span class="label">[21]</span></a> For an example, see Espinas and Pirenne, <i>Recueil de
+Documents relatifs &agrave; l'Histoire de la Draperie Flamande</i>, II. 391.</p></div>
+
+<div class="footnote"><p><a name="Footnote_22_22" id="Footnote_22_22"></a><a href="#FNanchor_22_22"><span class="label">[22]</span></a> J. Kulischer, "Warenh&auml;ndler und Geldausleiher im
+Mittelalter", <i>Zeitschrift f&uuml;r Volkswirtschaft</i>, etc., XVII. (1908).</p></div>
+
+<div class="footnote"><p><a name="Footnote_23_23" id="Footnote_23_23"></a><a href="#FNanchor_23_23"><span class="label">[23]</span></a> G. Espinas, "Jehan Boine-Broke, Bourgeois et Drapier
+Douaisien", <i>Vierteljahrschrift f&uuml;r Social- und Wirtschaftsgeschichte</i>
+(1904), pp. 34 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_24_24" id="Footnote_24_24"></a><a href="#FNanchor_24_24"><span class="label">[24]</span></a> For the relations of the capitalists with the English
+crown see: Whitwell, "Italian Bankers and the English Crown",
+<i>Transactions of the Royal Historical Society</i>, XVII. (1903); and Bond,
+"Extract from the Liberate Rolls relative to the Loans supplied by
+Italian Merchants to the Kings of England", <i>Archaeologia</i>, XXVII.
+(1840). <i>Cf.</i> Hansen, "Der Englische Staatscredit unter K&ouml;nig Edward
+III. und die Hansischen Kaufleute", <i>Hansische Geschichtsbl&auml;tter</i>
+(1910).</p></div>
+
+<div class="footnote"><p><a name="Footnote_25_25" id="Footnote_25_25"></a><a href="#FNanchor_25_25"><span class="label">[25]</span></a> F. Arens, "Wilhelm Servat von Cahors als Kaufmann zu
+London", <i>Vierteljahrschrift f&uuml;r Social- und Wirtschaftsgeschichte</i>
+(1913), pp. 477 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_26_26" id="Footnote_26_26"></a><a href="#FNanchor_26_26"><span class="label">[26]</span></a> V. Fris, "Thomas Fin, Receveur de Flandre", <i>Bulletin de
+la Commission Royale d'Histoire de Belgique</i> (1900), pp. 8 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_27_27" id="Footnote_27_27"></a><a href="#FNanchor_27_27"><span class="label">[27]</span></a> Schneider, "Die Finanziellen Beziehungen der
+Florentinischen Banquiers zur Kirche", <i>Schmollers Forschungen</i>, vol.
+XVII.</p></div>
+
+<div class="footnote"><p><a name="Footnote_28_28" id="Footnote_28_28"></a><a href="#FNanchor_28_28"><span class="label">[28]</span></a> Pirenne, "Une Crise Industrielle an XVI^e Si&egrave;cle",
+<i>Bulletin de l'Acad&eacute;mie Royale de Belgique</i>, classe des lettres (1905).</p></div>
+
+<div class="footnote"><p><a name="Footnote_29_29" id="Footnote_29_29"></a><a href="#FNanchor_29_29"><span class="label">[29]</span></a> R. Ehrenberg, <i>Das Zeitalter der Fugger</i>, I. 311 ff.</p></div>
+
+<div class="footnote"><p><a name="Footnote_30_30" id="Footnote_30_30"></a><a href="#FNanchor_30_30"><span class="label">[30]</span></a> J. F. Jameson, "Willem Usselinx", in Am. Hist. Assoc.,
+<i>Papers</i>, II.</p></div>
+
+<div class="footnote"><p><a name="Footnote_31_31" id="Footnote_31_31"></a><a href="#FNanchor_31_31"><span class="label">[31]</span></a> See, in Cunningham, <i>The Growth of English Industry and
+Commerce in Modern Times</i>, p. 618, this citation from P. Gaskell: "Few
+of the men who entered the trade rich were successful. They trusted too
+much to others, too little to themselves." Let us recall here that the
+founder of the largest industrial establishments of Belgium, John
+Cockerill, was a simple workman. See E. Mahaim, "Les D&eacute;buts de
+l'&Eacute;tablissement John Cockerill &agrave; Seraing", <i>Vierteljahrschrift f&uuml;r
+Social- und Wirtschaftsgeschichte</i> (1905), p. 627.</p></div>
+</div>
+
+<p>&nbsp;</p>
+<p>&nbsp;</p>
+<hr class="full" />
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+The Project Gutenberg eBook, The Stages in the Social History of
+Capitalism, by Henri Pirenne
+
+
+This eBook is for the use of anyone anywhere at no cost and with
+almost no restrictions whatsoever.  You may copy it, give it away or
+re-use it under the terms of the Project Gutenberg License included
+with this eBook or online at www.gutenberg.org
+
+
+
+
+
+Title: The Stages in the Social History of Capitalism
+       An Address Delivered at the International Congress of Historical Studies, London, April, 1913
+
+
+Author: Henri Pirenne
+
+
+
+Release Date: May 4, 2010  [eBook #32252]
+
+Language: English
+
+Character set encoding: ISO-646-US (US-ASCII)
+
+
+***START OF THE PROJECT GUTENBERG EBOOK THE STAGES IN THE SOCIAL HISTORY
+OF CAPITALISM***
+
+
+E-text prepared by Fritz Ohrenschall, Martin Pettit, and the Project
+Gutenberg Online Distributed Proofreading Team (http://www.pgdp.net)
+
+
+
+Note: Project Gutenberg also has an HTML version of this
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+      or
+      (http://www.gutenberg.org/files/32252/32252-h.zip)
+
+
+
+
+
+THE STAGES IN THE SOCIAL HISTORY OF CAPITALISM[1]
+
+by
+
+HENRI PIRENNE
+
+
+
+
+
+In the pages that follow I wish only to develop a hypothesis. Perhaps
+after having read them, the reader will find the evidence insufficient.
+I do not hesitate to recognize that the scarcity of special studies
+bearing upon my subject, at least for the period since the end of the
+Middle Ages, is of a nature to discourage more than one cautious spirit.
+But, on the one hand, I am convinced that every effort at synthesis,
+however premature it may seem, cannot fail to react usefully on
+investigations, provided one offers it in all frankness for what it is.
+And, on the other hand, the kind reception which the ideas here
+presented received at the International Congress of Historical Studies
+held at London last April, and the desire which has been expressed to me
+by scholars of widely differing tendencies to see them in print, have
+induced me to publish them. Various objections which have been expressed
+to me, as well as my own subsequent reflections, have caused me to
+revise and complete on certain points my London address. In the
+essential features, however, nothing has been changed.
+
+A word first of all to indicate clearly the point of view which
+characterizes the study. I shall not enter into the question of the
+formation of capital itself, that is, of the sum total of the goods
+employed by their possessor to produce more goods at a profit. It is the
+capitalist alone, the holder of capital, who will hold our attention. My
+purpose is simply to characterize, for the various epochs of economic
+history, the nature of this capitalist and to search for his origin. I
+have observed, in surveying this history from the beginning of the
+Middle Ages to our own times, a very interesting phenomenon to which, so
+it seems to me, attention has not yet been sufficiently called. I
+believe that, for each period into which our economic history may be
+divided, there is a distinct and separate class of capitalists. In other
+words, the group of capitalists of a given epoch does not spring from
+the capitalist group of the preceding epoch. At every change in economic
+organization we find a breach of continuity. It is as if the capitalists
+who have up to that time been active, recognize that they are incapable
+of adapting, themselves to conditions which are evoked by needs hitherto
+unknown and which call for methods hitherto unemployed. They withdraw
+from the struggle and become an aristocracy, which if it again plays a
+part in the course of affairs, does so in a passive manner only,
+assuming the role of silent partners. In their place arise new men,
+courageous and enterprising, who boldly permit themselves to be driven
+by the wind actually blowing and who know how to trim their sails to
+take advantage of it, until the day comes when, its direction changing
+and disconcerting their manoeuvres, they in their turn pause and are
+distanced by new craft having fresh forces and new directions. In short,
+the permanence throughout the centuries of a capitalist class, the
+result of a continuous development and changing itself to suit changing
+circumstances, is not to be affirmed. On the contrary, there are as many
+classes of capitalists as there are epochs in economic history. That
+history does not present itself to the eye of the observer under the
+guise of an inclined plane; it resembles rather a staircase, every step
+of which rises abruptly above that which precedes it. We do not find
+ourselves in the presence of a gentle and regular ascent, but of a
+series of lifts.
+
+In order to establish the validity of these generalizations it is of
+course needful to control them by the observation of facts, and the
+longer the period of time covered the more convincing will the
+observations be. The economic history of antiquity is still too little
+known, and its relations to the ages which follow have escaped us too
+completely, for us to take our point of departure there; but the
+beginning of the Middle Ages gives us access to a body of material
+sufficient for our purpose.
+
+But first of all, it is needful to meet a serious objection. If it is in
+fact true, as seems to be usually conceded since the appearance of
+Buecher's brilliant _Entstehung der Volkswirtschaft_[2]--to say nothing
+here of the thesis since formulated with such extreme radicalism by W.
+Sombart[3]--that the economic organisation of the Middle Ages has no
+aspect to which one can rightly apply the term capitalistic, then our
+thesis is limited wholly to modern times and there can be no thought of
+introducing into the discussion the centuries preceding the Renaissance.
+But whatever may be the favor which it still enjoys, the theory which
+refuses to perceive in the medieval urban economy the least trace of
+capitalism has found in recent times ever increasing opposition. I will
+not even enumerate here the studies which seem to me to have in an
+incontrovertible manner established the fact that all the essential
+features of capitalism--individual enterprise, advances on credit,
+commercial profits, speculation, etc.--are to be found from the twelfth
+century on, in the city republics of Italy--Venice,[4] Genoa,[5] or
+Florence.[6] I shall not ask what one can call such a navigator as
+Romano Mairano (1152-1201), if, in spite of the hundreds of thousands of
+francs he employed in business, the fifty per cent. profits he realized
+on his operations in coasting trade, and his final failure, one persists
+in refusing to him the name of capitalist. I shall pass over the
+disproof of the alleged ignorance of the medieval merchants. I shall say
+nothing of the astonishing errors committed in the calculations, so
+confidently offered to us as furnishing mathematical proof of the
+naivete of historians who can believe the commerce of the thirteenth and
+fourteenth centuries to have been anything more than that of simple
+peddlers, a sort of artisans incapable of rising even to the idea of
+profit, and having no views beyond the day's livelihood.[7] Important as
+all this may be, the weak point in the theory which I am here opposing
+seems to me to lie especially in a question of method. Buecher and his
+partizans, in my opinion, have, without sufficient care, used for their
+picture of the city economy of the Middle Ages the characteristics of
+the German towns and more particularly the German towns of the
+fourteenth and fifteenth centuries. Now the great majority of the German
+towns of that period were far from having attained the degree of
+development which had been reached by the great communes of northern
+Italy, of Tuscany, or of the Low Countries. Instead of presenting the
+classical type of urban economy, they are merely examples of it
+incompletely developed; they present only certain manifestations; they
+lack others, and particularly those which belong to the domain of
+capitalism. Therefore in presenting as true of all the cities of the
+Middle Ages a theory which rests only on the observation of certain of
+them, and those the least advanced, one is necessarily doing violence to
+reality. Buecher's description of _Stadtwirtschaft_ remains a masterpiece
+of penetration and economic understanding. But it is too restricted. It
+does not take account of certain elements of the problem, because these
+elements were not encountered in the narrow circle which the research
+covered. One may be confident that if, instead of proceeding from the
+analysis of such towns as Frankfort, this study had considered
+Florence, Genoa, and Venice, or even Ghent, Bruges, Ypres, Douai, or
+Tournai, the picture which it furnished us would have been very
+different. Instead of refusing to see capitalism of any kind in the
+economic life of the bourgeoisie, the author would have recognized, on
+the contrary, unmistakable evidences of capitalism. I shall later have
+occasion to return to this very essential question. But it was
+indispensable to indicate here the position which I shall take in regard
+to it.
+
+Of course I do not at all intend to reject _en bloc_ the ideas generally
+agreed upon concerning the urban economy of the Middle Ages. On the
+contrary, I believe them to be entirely accurate in their essential
+elements, and I am persuaded that, in a very large number of cases, I
+will even say, if you like, in the majority of cases, they provide us
+with a theory which is completely satisfactory. I am very far from
+maintaining that capitalism exercised a preponderant influence on the
+character of economic organization from the twelfth to the fifteenth
+centuries. I believe that, though it is not right to call this
+organization "acapitalistic", it is on the other hand correct to
+consider it "anticapitalistic". But to affirm this is to affirm the
+existence of capital. That organization recognized the existence of
+capital since it tried to defend itself against it, since, from the end
+of the thirteenth century onward, it took more and more measures to
+escape from its abuses. It is incontestable that, from this period on,
+it succeeded by legal force in diminishing the role which capitalism had
+played up to that time. In fact it is certain, and we shall have
+occasion to observe it, that the power of capital was much greater
+during the first part of the urban period of the Middle Ages than during
+the second. But even in the course of the latter period, if municipal
+legislation seems more or less completely to have shut it out from local
+markets, capital succeeded in preserving and in dominating a very
+considerable portion of economic activity. It is capital which rules in
+inter-local commerce, which determines the forms of credit, and which,
+fastening itself on all the industries which produce not for the city
+market but for exportation, hinders them from being controlled, as the
+others are, by the minute regulations which in innumerable ways cramp
+the activity of the craftsmen.[8]
+
+Let us recognize, then, that capitalism is much older than we have
+ordinarily thought it. No doubt its operation in modern times has been
+much more engrossing than in the Middle Ages. But that is only a
+difference of quantity, not a difference of quality, a simple difference
+of intensity not a difference of nature. Therefore, we are justified in
+setting the question we set at the beginning. We can, without fear of
+pursuing a vain shadow, endeavor to discern what throughout history have
+been the successive stages in the social evolution of capitalism.
+
+Of the period which preceded the formation of towns, that is, of the
+period preceding the middle of the eleventh century, we know too little
+to permit ourselves to tarry there. What may still have survived in
+Italy and in Gaul of the economic system of the Romans has disappeared
+before the beginning of the eighth century. Civilization has become
+strictly agricultural and the domain system has impressed its form upon
+it. The land, concentrated in large holdings in the hands of a powerful
+landed aristocracy, barely produces what is necessary for the proprietor
+and his _familia_. Its harvests do not form material for commerce. If
+during years of exceptional abundance the surplus is transported to
+districts where scarcity prevails, that is all. In addition certain
+commodities of ordinary quick consumption, and which nature has
+distributed unequally over the soil, such as wine or salt, sustain a
+sort of traffic. Finally, but more rarely, products manufactured by the
+rural industry of countries abounding in raw materials, such as, to cite
+only one, the friezes woven by the peasants of Flanders, maintain a
+feeble exportation. Of the condition of the _negociatores_ who served as
+the instruments of these exchanges, we know almost nothing. Many of them
+were unquestionably merchants of occasion, men without a country, ready
+to seize on any means of existence that came their way. Pursuers of
+adventure were frequent among these roving creatures, half traders, half
+pirates, not unlike the Arab merchants who even to our day have searched
+for and frequently have found fortunes amid the negro populations of
+Africa. At least, to read the history of that Samo who at the beginning
+of the eighth century, arriving at the head of a band of adventuring
+merchants among the Wends of the Elbe, ended by becoming their king,
+makes one think involuntarily of certain of those beys or sheiks
+encountered by voyagers to the Congo or the Katanga.[9] Clearly no one
+will try to find in this strong and fortunate bandit an ancestor of the
+capitalists of the future. Commerce, as he understood and practised it,
+blended with plunder, and if he loved gain it was not in the manner of a
+man of affairs but rather in that of a primitive conqueror with whom
+violence of appetite took the place of calculation. Samo was evidently
+an exception. But the spirit which inspired him may have inspired a
+goodly number of _negociatores_ who launched their barks on the streams
+of the ninth century. In the society of this period only the possession
+of land or attachment to the following of a great man could give one a
+normal position. Men not so provided were outside the regular
+classification, forming a confused mass, in which were promiscuously
+mingled professional beggars, mercenaries in search of employment,
+masters of barges or drivers of wagons, peddlers, traders, all jostling
+in the same sort of hazardous and precarious life, and all no doubt
+passing easily from one employment to another. This is not to say,
+however, that among the _negociatores_ of the Frankish epoch there were
+not also individuals whose situation was more stable and whose means of
+existence were less open to suspicion. Indeed, we know that the great
+proprietors, lay or ecclesiastical, employed certain of their serfs or
+of their _ministeriales_ in a sporadic commerce of which we have already
+mentioned above the principal features. They commissioned them to buy at
+neighboring markets the necessary commodities or to transport to places
+of sale the occasional surplus of their grain or their wine. Here too we
+discover no trace of capitalism. We merely find ourselves in the
+presence of hereditary servants performing gratuitous service, entirely
+analogous to military service.
+
+Nevertheless commercial intercourse produced even then, in certain
+places particularly favored by their geographic situation, groups of
+some importance. We find them along the sea-coast--Marseilles, Rouen,
+Quentovic--or on the banks of the rivers, especially in those places
+where a Roman road crosses the stream, as at Maastricht on the Meuse or
+at Valenciennes on the Scheldt. We are to think of these _portus_ as
+wharves for merchandise and as winter quarters for boats and boatmen.
+They differ very distinctly from the towns of the following period. No
+walls surround them; the buildings which are springing up seem to be
+scarcely more than wooden sheds, and the population which is found there
+is a floating population, destitute of all privileges and forming a
+striking contrast to the bourgeoisie of the future. No organization
+seems to have bound together the adventurers and the voyagers of these
+_portus_. Doubtless it is possible, it is even probable, that a certain
+number of individuals, profiting by circumstance, may have little by
+little devoted themselves to trade in a regular fashion and have begun
+by the ninth century to form the nucleus of a group of professional
+traders. But we have too little information to enable us to speak with
+any precision.
+
+The operations of credit follow much the same course. We cannot doubt
+that loans had been employed in the Carolingian period, and the Church
+as well as the State had occupied itself in combating their abuses.[10]
+But it would be a manifest exaggeration to deduce from this the
+existence of even a rudimentary capitalistic economy. Everything
+indicates that the loans which we are considering here were only
+occasional loans, of usurious nature, to which people who had met with
+some catastrophe, such as war, a fire, or a poor harvest, were forced to
+have recourse temporarily.
+
+Thus, the early centuries of the Middle Ages seem to have been
+completely ignorant of the power of capital. They abound in wealthy
+landed proprietors, in rich monasteries, and we come upon hundreds of
+sanctuaries the treasure of which, supplied by the generosity of the
+nobles or the offerings of the faithful, crowds the altar with ornaments
+of gold or of solid silver. A considerable fortune is accumulated in the
+Church, but it is an idle fortune. The revenues which the landowners
+collect from their serfs or from their tenants are directed toward no
+economic purpose. They are scattered in alms, in the building of
+monuments, in the purchase of works of art, or of precious objects which
+should serve to increase the splendor of religious ceremonies. Wealth,
+capital, if one may so term it, is fixed motionless in the hands of an
+aristocracy, priestly or military. This is the essential condition of
+the patronage that this aristocracy (_majores et divites_) exercises
+over the people (_pauperes_). Its action is as important from the social
+point of view as it is unimportant from that of economics. No part of it
+is directed toward the _negociatores_, who, left to themselves, live, so
+to speak, on the fringe of society. And so it will continue to be, for
+long centuries.
+
+Landed property, indeed, did not contribute at all to that awakening of
+commercial activity which, after the disasters of the Norman invasion in
+the North and the Saracen raids on the shores of the Mediterranean,
+began to manifest itself toward the end of the tenth century and the
+beginning of the eleventh. Its preliminary manifestations are found at
+the two extremities of the Continent, Italy and the Low Countries. The
+interior seas, between which Europe was restricted in her advance toward
+the Atlantic, were its first centres of activity. Venice, then Genoa and
+Pisa, venture on the coasting trade along their shores, and then
+maintain, with their rich neighbors of Byzantium or of the Mohammedan
+countries, a traffic which henceforward constantly increases. Meanwhile
+Bruges at the head of the estuary of the Zwyn, becomes the centre of a
+navigation radiating toward England, the shores of North Germany, and
+the Scandinavian regions. Thus, economic life, as in the beginning of
+Hellenic times, first becomes active along the coasts. But soon it
+penetrates into the interior of the country. Step by step it wins its
+way along the rivers and the natural routes. On this side and on that,
+it arouses the hinterland into which the harbors cut their indentations.
+In this process of growth the two movements finally meet, and bring into
+communication the people of the North and the people of the South. By
+the beginning of the twelfth century it is an accomplished fact. In 1127
+Lombard merchants, journeying by the long route which descends from the
+passes of the Alps toward Champagne and the Low Countries, reach the
+fairs of Flanders.
+
+If the feeble and precarious commercial activity of the Carolingian
+period was sufficient to create gathering-places of merchants at the
+points most frequented in travel, it is not difficult to understand that
+the steady progress of economic activity from the end of the tenth
+century would result in the formation, at the strategic points of
+regional transit, of aggregations of like character but much more
+important and more stable. The surface of the land, the direction and
+the depth of the streams, determining the routes of commerce, also
+determined the location of the towns. Indeed, European cities are the
+daughters of commerce and of industry. Unquestionably in the countries
+of old civilization, in Italy or in Gaul, the Roman cities had not
+completely disappeared. Within the circle of their walls, which had now
+become too large and were filled with ruins, there gathered, around the
+bishop resident in each of them, a whole population of clerics and
+monks, and beside them a lay population employed in their service or
+support. In the North, one found the same spectacle at the centres of
+the new dioceses, at Therouanne, at Utrecht, at Magdeburg, or at Vienna.
+But here was no trace, properly speaking, of municipal life. A certain
+number of artisans, some of them serfs, a little weekly market for the
+most indispensable commodities, sometimes a fair visited by the
+merchant-adventurers of whom we have spoken above--this is the sum total
+of economic life.
+
+But the situation changes from the moment when the increasing intensity
+of commerce begins to furnish men with new means of existence.
+Immediately one discovers an uninterrupted movement of migration of
+peasants from the country towards the places in which the handling of
+merchandise, the towing of boats, the service of merchants furnish
+regular occupations and arouse the hope of gain.
+
+If the old cities disadvantageously placed at one side from the highways
+of travel continue in their torpor, the others see their population
+increase continuously. Suburbs join the old enclosure; new markets are
+established; new churches are built for the new comers; and soon the
+primitive nucleus of the town, surrounded on all sides by the houses of
+the immigrants, becomes merely the quarter of the priests, bound to the
+shadow of the cathedral and submerged on all sides by the expansion of
+lay life. Much that at the beginning was the essential is now nothing
+more than the accessory. The episcopal burg disappears amid
+faubourgs.[11] The city has not been formed by growing with its own
+forces. It has been brought into existence by the attraction which it
+has exerted upon its surroundings whenever it has been aided by its
+situation. It is the creation of those who have migrated toward it. It
+has been made from without and not from within. The bourgeoisie of the
+oldest towns of Europe is a population of the transplanted. But it is at
+the same time essentially a trading population, and no other proof of
+this need be advanced than the fact that, down to the beginning of the
+twelfth century, _mercator_ and _burgensis_ were synonymous terms.
+
+Whence came these pioneers of commerce, these immigrants seeking means
+of subsistence, and what resources did they bring with them into the
+rising towns? Doubtless only the strength of their arms, the force of
+their wills, the clearness of their intelligence. Agricultural life
+continued to be the normal life and none of those who remained upon the
+soil could entertain the idea of abandoning his holding to go to the
+town and take his chances in a new existence. As for selling the holding
+to get ready money, like the men of a modern rural population, no one at
+that time could have imagined such a transaction. The ancestors of the
+bourgeoisie must then be sought, specifically, in the mass of those
+wandering beings who, having no land to cultivate, floated across the
+surface of society, living from day to day upon the alms of the
+monasteries, hiring themselves to the cultivators of the soil in harvest
+time, enlisting in the armies in time of war, and shrinking from neither
+pillage nor rapine if the occasion presented itself. It may without
+difficulty be admitted that there may have been among them some rural
+artisans or some professional peddlers. But it is beyond question that
+with very few exceptions it was poor men who floated to the towns and
+there built up the first fortunes in movable property that the Middle
+Ages knew.
+
+Fortunately we possess certain narratives which enable us to support
+this thesis with concrete examples. It will suffice to cite here the
+most characteristic of them, the biography of St. Godric of
+Finchale.[12]
+
+He was born of poor peasants in Lincolnshire, toward the end of the
+eleventh century, and from infancy was forced to tax his ingenuity to
+find the means of livelihood. Like many other unfortunates of all times,
+he at first walked the beaches on the outlook for wreckage cast up by
+the sea. Then we see him, perhaps by reason of some fortunate find,
+setting up as a peddler and travelling through the country with a little
+pack of goods (_cum mercibus minutis_). At length he gathers together a
+small sum, and one fine day joins a troop of town merchants whom he has
+met in the course of his wanderings. Thenceforward he goes with his
+companions from market to market, from fair to fair, from town to town.
+Having thus become a professional merchant, he rapidly gains a
+sufficient sum to enable him to associate himself with other merchants,
+charter a boat with them, and engage in the coasting trade along the
+shores of England, Scotland, Denmark, and Flanders. The company is
+highly successful. Its operations consist in carrying to a foreign
+country goods which it knows to be uncommon there, in selling them there
+at a high price, and acquiring in exchange various merchandise which it
+takes pains to dispose of in the places where the demand for them is
+greatest and where it can consequently make the greatest gains. At the
+end of some years this prudent practice of buying cheap and selling dear
+has made of Godric, and doubtless of his associates, a man of important
+wealth. Then, touched by divine grace, he suddenly renounces his
+fortune, gives his goods to the poor, and becomes a monk.
+
+The story of Godric, if one omits its pious conclusion, must have been
+that of many others. It shows us, with perfect clearness, how a man
+beginning with nothing might in a relatively short time amass a
+considerable capital. Our adventurer must have been favored by
+circumstances and chance. But the secret of his success, and the
+contemporary biographer to whom we owe the story insists strongly upon
+it, is intelligence.[13] Godric in fact shows himself a calculator, I
+might even say a speculator. He has in a high degree the feeling, and it
+is much more developed among minds without culture than is usually
+thought, for what is practicable in commerce. He is on fire with the
+love of gain. One sees clearly in him that famous _spiritus
+capitalisticus_ of which some would have us believe that it dates only
+from the time of the Renaissance. Here is an eleventh-century merchant,
+associated with companions like himself, combining his purchases,
+reckoning his profits, and, instead of hiding in a chest the money he
+has gained, using it only to support and extend his business. More than
+this, he does not hesitate to devote himself to operations which the
+Church condemns. He is not disquieted by the theory of the just price;
+the Decretum of Gratian disapproves in express terms of the speculations
+which he practises: "Qui comparat rem ut illam ipsam integram et
+immutatam dando lucretur, ille est mercator qui de templo Dei ejicitur".
+
+After this, how can we see, in Godric and any of those who led the same
+sort of life, anything else but capitalists? It is impossible to
+maintain that these men conducted business only to supply their daily
+wants, impossible not to see that their purpose is the constant
+accumulation of goods, impossible to deny that, barbarous as we may
+suppose them, they none the less possessed the comprehension, or, if one
+prefers, had the instinct for commerce on the large scale.[14] Of the
+organization of this commerce the life of Godric shows us already the
+principal features, and the description which it gives us of them is the
+more deserving of confidence because it is corroborated in the most
+convincing fashion by many documents. It shows us, first of all, the
+merchant coming from the country to establish himself in the town. But
+the town is to him, so to speak, merely a basis of operations. He lives
+there but little, save in the winter. As soon as the roads are
+practicable and the sea open to navigation, he sets out. His commerce is
+essentially a wandering commerce, and at the same time a collective one,
+for the insecurity of the roads and the powerlessness of the solitary
+individual compel him to have recourse to association. Grouped in gilds,
+in hanses, in _caritates_, the associates take their merchandise in
+convoy from town to town, presenting a spectacle entirely like that
+which the caravans of the East still furnish in our day. They buy and
+sell in common, dividing the profits in the ratio of their respective
+investments in the expedition, and the trade they carry on in the
+foreign markets is wholesale trade, and can only be that, for retail
+trade, as the life of Godric shows us, is left to the rural peddlers. It
+is in gross that they export and import wine, grain, wool, or cloth. To
+convince ourselves of this we need only examine the regulations which
+have been preserved to us. The statutes of the Flemish hanse of London,
+for example, formally exclude retail dealers and craftsmen from the
+company.
+
+Moreover, the merchant associations of the eleventh and twelfth
+centuries have nothing exclusively local in their character. In them we
+find bourgeoisie of different towns, side by side. They have rather the
+appearance of regional than of urban organisms. They are still far from
+the exclusivism and the protectionism which are to be shown with so much
+emphasis in the municipal life of the fourteenth century. Commercial
+freedom is not troubled by any restrictive regulations. Public authority
+assigns no limits to the activity of the merchants, does not restrict
+them to this or that kind of business, exercises no supervision over
+their operations. Provided they pay the fiscal dues (_teloneum,
+conductus_, etc.) levied by the territorial prince and the seigneurs
+having jurisdiction at the passage of the bridges, along the roads and
+rivers, or at the markets, they are entirely free from all legal
+obstacles. The only restrictions which hinder the full expansion of
+commerce do not come from the official authority, but result from the
+practices of commerce itself. To wit, the various merchant associations,
+gilds, hanses, etc., which encounter each other at the places of buying
+and selling, oppose each other in brutal competition. Each of them
+excludes from all participation in its affairs the members of all the
+others. But this is merely a state of facts, resting on no legal title.
+Force holds here the place of law, and whatever may be the differences
+of time and of environment, one cannot do otherwise than to compare the
+commerce of the eleventh and twelfth centuries to that bloody
+competition in which, in the sixteenth and seventeenth centuries, the
+sailors of Holland, England, France, and Spain engaged in the markets of
+the New World. We shall conclude then that medieval commerce, at its
+origin, is essentially characterized by its regional quality and by its
+freedom. And it is not difficult to understand that it was so, if one
+bears in mind two facts to which attention should be drawn.
+
+In the first place, down to the end of the twelfth century, the number
+of towns properly so-called was relatively small. Only those places that
+were favored by a privileged geographical situation attracted the
+merchants in sufficient number to enable them to maintain a commercial
+movement of real importance. After that the attraction which these
+centres of business exerted upon their environs was much greater than is
+ordinarily imagined. All the secondary localities were subject to their
+influence. The merchants dwelling in these last, too few to act by
+themselves, affiliated themselves to the hanse or gild of the principal
+town. The Flemish hanse, which we have already instanced, proves this
+fully, by showing us the merchants of Dixmude, Damme, Oudenbourg,
+Ardenbourg, etc., seeking admission into the hanse of Bruges.
+
+In the second place, at the period we have now reached the towns devoted
+themselves far more to commerce than to industry. Few could be cited
+that appear thus early as manufacturing centres. The concentration of
+artisans within their walls is still incomplete. If their merchants
+export, along with the products of the soil, such as wine and grain, a
+quantity of manufactured products, such, for example, as cloth, it is
+more than probable that these were for the most part made in the
+country.
+
+Admit these two statements, and the nature of early commerce is
+explained without difficulty. They account in fact both for the freedom
+of the merchants and for that character of wholesale exporters which
+they exhibit so clearly and which prevents our placing them in the
+category in which the theory of urban economy claims to confine them.
+Contrary to the general belief, it appears then that before the
+thirteenth century we find a period of free capitalistic expansion. No
+doubt the capitalism of that time is a collective capitalism: groups,
+not isolated individuals, are its instruments. No doubt too it contents
+itself with very simple operations. The commercial expeditions upon
+which its activity especially centres itself demand, for their
+successful conduct, an endurance, a physical strength, which the more
+advanced stages of economic evolution will not require. But they demand
+nothing more. Without the ability to plan and combine they would remain
+sterile. And so we can see that, from the beginning, what we find at the
+basis of capitalism is intelligence, that same intelligence which Georg
+Hansen has so well shown, long ago, to be the efficient cause of the
+emergence of the bourgeoisie.[15]
+
+The fortunes acquired inn the wandering commerce by the parvenus of the
+eleventh and twelfth centuries soon transformed them into landed
+proprietors. They invest a good part of their gains in lands, and the
+land they thus acquire is naturally that of the towns in which they
+reside. From the beginning of the thirteenth century one sees this land
+held in large parcels by an aristocracy of patricians, _viri
+hereditarii_, _divites_, _majores,_ in whom we cannot fail to recognize
+the descendants of the bold voyagers of the gilds and the hanses. The
+continuous increase of the burghal population enriches them more and
+more, for as new inhabitants establish themselves in the towns, and as
+the number of the houses increases, the rent of the ground increases in
+proportion. So, from the commencement of the thirteenth century, the
+grandsons of the primitive merchants abandon commerce and content
+themselves with living comfortably upon the revenue of their lands. They
+bid farewell to the agitations and the chances of the wandering life.
+They live henceforward in their stone houses, whose battlements and
+towers rise above the thatched roofs of the wooden houses of their
+tenants. They assume control of the municipal administration; they and
+their families monopolize the seats in the _echevinage_ or the town
+council. Some even, by fortunate marriages, ally themselves with the
+lesser nobility and begin to model their manner of living upon that of
+the knights.
+
+But while these first generations of capitalists are retiring from
+commerce and rooting themselves in the soil, important changes are going
+on in the economic organization. In the first place, in proportion as
+the wealth of the towns increases, and with it their attractive power,
+they take on more and more an industrial character, the rural artisans
+flocking into them _en masse_ and deserting the country. At the same
+time, many of them, favored by the abundance of raw material furnished
+by the surrounding region, begin to devote themselves to certain
+specialties of manufacture--cloth-making or metallurgy. Finally, around
+the principal aggregations many secondary localities develop, so that
+all Western Europe, in the course of the thirteenth century, blossoms
+forth in an abundance of large and small towns. Some, and much the
+greater number of them, content themselves perforce with local commerce.
+Their production is determined by the needs of their population and that
+of the environs which extend two or three leagues around their walls
+and, in exchange for the manufactured articles which the city furnishes
+to them, attend to the food supply of the urban inhabitants. Other
+towns, on the contrary, less closely set together but also more
+powerful, develop chiefly by means of an export industry, producing, as
+did the cloth industry of great Flemish or Italian cities, not for their
+local market,[16] but for the European market, constantly extensible.
+Others still, profiting by the advantages of nearness to the sea, give
+themselves up to navigation and to transportation, as did so many ports
+of Italy, of France, of England, and especially of North Germany.
+
+Of these two types of towns, the one sufficient to themselves, the other
+living upon the outside world, it is unquestionably the first to which
+the theory of the urban economy applies. Direct trade between purchaser
+and consumer, strict protectionism excluding the foreigner from the
+local market and reserving it to the bourgeoisie alone, minute
+regulations confining within narrow limits the industry of the merchant
+and the artisan; in a word, all the traits of an organization evidently
+designed to preserve and safeguard the various members of the community
+by assigning to each his place and his role, are all found and all
+explained without difficulty in those towns which are confined to a
+clientage limited by the extent of their suburban dependencies. In these
+one can rightly speak of an anti-capitalistic economy. In these we find
+neither great _entrepreneurs_ nor great merchants. It is true that the
+necessity of stocking the town with commodities which it does not
+produce or cannot find in its environs--groceries, fine cloths, wines in
+northern countries--brings into existence a group of exporters whose
+condition is superior to that of their fellow-citizens. But on
+inspection they cannot be regarded as a class of great professional
+merchants. If they buy at wholesale in foreign markets, it is to sell at
+retail to their fellow-citizens. They dispose of their goods piecemeal,
+and like the _Gewandschneider_ of the German towns, they do not rise
+above the level of large shopkeepers.[17]
+
+In the towns of the second category we find a quite different condition.
+Here capitalism not only exists but develops toward perfection.
+Instruments of credit, such as the _lettre de foire,_ make their
+appearance; a traffic in money takes its place alongside the traffic in
+merchandise and, despite the prohibition of loans at interest, makes
+constantly more rapid progress. The _coutumes_ of the fairs, especially
+those of the fairs of the Champagne, in which the merchants of the
+regions most advanced in an economic sense, Italy and the Low Countries,
+meet each other, give rise to a veritable commercial law. The
+circulation of money expands and becomes regulated; the coinage of gold,
+abandoned since the Merovingian period, is resumed in the middle of the
+thirteenth century. The security of travellers increases on the great
+highways. The old Roman bridges are rebuilt and here and there canals
+are built and dykes constructed. Finally, in the towns, the commercial
+buildings of the previous period, outgrown, are replaced by structures
+more vast and more luxurious, of which the _halles_ of Ypres, with their
+facade one hundred and thirty-three metres long, is doubtless the most
+imposing specimen.
+
+In the presence of these facts it is impossible to deny the existence of
+a considerable traffic. Moreover documents abound which attest the
+existence in the great cities of men of affairs who hold the most
+extended relations with the outside world, who export and import sacks
+of wool, bales of cloth, tuns of wine, by the hundred, who have under
+their orders a whole corps of factors or "sergents" (_servientes_,
+_valets_, etc.), whose letters of credit are negotiated in the fairs of
+Champagne, and who make loans amounting to several thousands of livres
+to princes, monasteries, and cities in need of money. To cite here
+merely a few figures, let us recall that in 1273 the company of the
+Scotti of Piacenza exports wool from England to the value of 21,400
+pounds sterling, or 1,600,000 francs (metallic value);[18] in 1254
+certain burgesses of Arras furnish 20,000 livres to the Count of Guines,
+prisoner of the Count of Flanders, to enable him to pay his ransom.[19]
+In 1339 three merchants of Mechlin advance 54,000 florins (700,000
+francs) to King Edward III.[20]
+
+Extensive however as capitalistic commerce has been since the first half
+of the thirteenth century, it no longer enjoys the freedom of
+development which it had before. As we advance toward the end of the
+Middle Ages, indeed, we see it subjected to limitations constantly more
+numerous and more confining. Henceforth, in fact, it has to reckon with
+municipal legislation. Every town now shelters itself behind the
+ramparts of protectionism. If the most powerful cities can no longer
+exclude the stranger, upon whom they live, they impose upon him a minute
+regulation, the purpose of which is to defend against him the position
+of their own citizens. They force him to have recourse in his purchases
+to the mediation of his "hosts" and his "courtiers"; they forbid him to
+bring in manufactured articles which may compete with those which the
+city produces; they exploit him by levying taxes of all sorts: duties
+upon weighing, upon measuring, upon egress, etc.
+
+In those cities especially in which has occurred the popular revolution
+transferring power from the hands of the patriciate into those of the
+craft-gilds, distrust of capital is carried as far as it can go without
+entirely destroying urban industry. The craftsmen who produce for
+exportation--for example, the weavers and the fullers of the towns of
+Flanders--try to escape from their subjection, to the merchants who
+employ them. Not only do the municipal statutes fix wages and regulate
+the conditions of work, but they also limit the independence of the
+merchant, even in purely commercial matters. It will be sufficient to
+mention here, as one of their most characteristic provisions, the
+forbidding of the cloth merchant to be at the same time a wool merchant,
+a prohibition inspired by the desire to prevent operations that will
+unfavorably affect prices and the workman's wages.[21]
+
+But it is not solely the municipal authority which attacks the
+speculations born of the capitalistic spirit. The Church steps forward,
+and under the name of usury forbids indiscriminately the lending of
+money at interest, sales on credit, monopolies, and in general all
+profits exceeding the _justum pretium_. No doubt these prohibitions
+themselves attest the existence of the abuses which they endeavor to
+oppose, and their frequency proves that they did not always succeed. It
+is none the less true that they were very burdensome and that the
+pursuit of business on a large scale found itself much embarrassed by
+them.
+
+The increasing specialization of commerce embarrassed it much more. At
+the beginning the merchants had devoted themselves to the most various
+operations at once. Wandering from market to market, they bought and
+sold without feeling in need of centring their activity on this or that
+kind of products or commodities, but from about 1250 this is no longer
+the case. The progress of economic evolution has resulted in localizing
+certain industries and in restraining certain branches of commerce to
+the groups of merchants best suited to their promotion. Thus, for
+example, in the course of the thirteenth century the trade in fine cloth
+became a monopoly of the towns of Flanders, and banking a monopoly of
+certain merchant companies of Lombardy, Provence, or Tuscany.
+Thenceforward commercial life ceases to overflow at random, so to speak.
+It has a less arbitrary, a more deliberate, and consequently a more
+embarrassed quality.
+
+These limitations resting upon commerce have resulted in turning away
+from it the patricians, who moreover have become, as has been said
+above, a class of landed proprietors. The place which they left vacant
+is filled by new men, among whom, as among their predecessors,
+intelligence is the essential instrument of fortune. The intellectual
+faculties which the first developed in wandering commerce are used by
+these later men to overcome the obstacles raised in their pathway by
+municipal regulations of commerce and ecclesiastical regulations in
+respect to money affairs.[22] Many of them find a rich source of profit
+by devoting themselves to brokerage. Others in the industrial cities
+exploit shamelessly and in defiance of the statutes the artisans whom
+they employ. At Douai, for example, Jehan Boinebroke (1280-1310)
+succeeds in reducing to serfdom a number of workers (and
+characteristically, they are chiefly women) by advancing wool or money
+which they are unable to repay, and which therefore place them at his
+mercy.[23] The richest or the boldest profit by the constantly
+increasing need of money on the part of territorial princes and kings,
+to become their bankers. It will be remembered that it was Lombard
+capitalists who furnished Edward III. with money to prepare his
+campaigns against France,[24] and, quite recently, the history of
+Guillaume Servat of Cahors (1280-1320) has shown us a man who, setting
+out with nothing, like Godric in the eleventh century, accumulates in a
+few years a considerable fortune, supplies the King of England with a
+dowry for one of his daughters, lends money to the King of Norway, farms
+the wool duties at London, and, unscrupulous as he is shrewd, does not
+hesitate to engage in shady speculations upon the coinage.[25] And how
+many other financiers do we not know whose career is wholly similar:
+Thomas Fin at the court of the counts of Flanders,[26] the Berniers at
+that of the counts of Hainaut, the Tote Guis, the Vane Guis, at that of
+the kings of France, not to name the numberless Italians entrusted by
+the popes with the various operations of pontifical finance, those
+_mercatores Romanam curiam sequentes_ among whom are found the ancestors
+of the great Medici of the fifteenth century.[27]
+
+In the course of the fifteenth century this second class of capitalists,
+courtiers, merchants, and financiers, successors to the capitalists of
+the hanses and the gilds, is in its turn drawn along toward the downward
+grade. The progress of navigation, the discoveries made by the
+Portuguese, then by the Spaniards, the formation of great monarchical
+states struggling for supremacy, begin to destroy the economic situation
+in the midst of which that class had grown to greatness, and to which
+it had adapted itself. The direction of the currents of commerce is
+altered. In the north, the English and Dutch marine gradually take the
+place of the hanses. In the Mediterranean, commerce centres itself at
+Venice and at Genoa. On the shores of the Atlantic, Lisbon becomes the
+great market for spices, and Antwerp, supplanting Bruges, becomes the
+rendezvous of European commerce. The sixteenth century sees this
+movement grow more rapid. It is favored at once by moral, political, and
+economic causes; the intellectual progress of the Renaissance, the
+expansion of individualism, great wars exciting speculation, the
+disturbance of monetary circulation caused by the influx of precious
+metals from the New World. As the science of the Middle Ages disappears
+and the humanist takes the place of the scholastic, so a new economy
+rises in the place of the old urban economy. The state subjects the
+towns to its superior power. It restrains their political autonomy at
+the same time that is sets commerce and industry free from the
+guardianship which the towns have hitherto imposed upon them. The
+protectionism and the exclusiveness of the bourgeoisies are brought to
+an end. If the craft-guilds continue to exist, yet they no longer
+control the organization of labor. New industries appear, which, to
+escape the meddling surveillance of the municipal authorities, establish
+themselves in the country. Side by side with the old privileged towns,
+which merely vegetate, younger manufacturing centres, full of strength
+and exuberance, arise; in England, Sheffield, and Birmingham, in
+Flanders, Hondschoote and Armentieres.[28]
+
+The spirit in which is now manifested in the world of business, is that
+same spirit of freedom which animates the intellectual world. In a
+society in process of formation, the individual, enfranchised, gives the
+rein to his boldness. He despises tradition, gives himself up with
+unrestrained delight to his virtuosity. There are to be no more limits
+on speculation, no more fetters on commerce, no more meddling of
+authority in relations between employers and employed. The most skillful
+wins. Competition, up to this time held in check, runs riot. In a few
+years enormous fortunes are built up, others are swallowed up in
+resounding bankruptcies. The Antwerp exchange is a pandemonium where
+bankers, deep-sea sailors, stock-jobbers, dealers in futures,
+millionaire merchants, jostle each other--and sharpers and adventurers
+to whom all means of money-getting, even assassination, are acceptable.
+
+This confused recasting of the economic world transfers the role played
+by the capitalists of the late Middle Ages in a class of new men. Few
+are the descendants of the business men of the fourteenth century among
+those of the fifteenth and sixteenth. Thrown out of their course by the
+current of events, they have not been willing to risk fortunes already
+acquired. Most of them are seen turning toward administrative careers,
+entering the service of the state as members of the councils of justice
+or finance and aspiring to the _noblesse de robe_, which, with the aid
+of fortunate marriages, will land their sons in the circle of the true
+nobility. As for the new rich of the period, they almost all appear to
+us like parvenus. Jacques Coeur is a parvenu in France. The Fugger and
+many other German financiers--the Herwarts, the Seilers, the Manlichs,
+the Haugs--are parvenus of whose families we know little before the
+fifteenth century, and so are the Frescobaldi and the Gualterotti of
+Florence, or that Gaspar Ducci of Pistoia who is perhaps the most
+representative of the fortune-hunters of the period.[29] Later, when
+Amsterdam has inherited the commercial hegemony of Antwerp, the
+importance of the parvenus characterizes it not less clearly. We may
+merely mention here, among the first makers of its greatness, Willem
+Usselinx,[30] Balthazar de Moucheron, Isaac Lemaire. And if from the
+world of commerce we turn toward that of industry the aspect is the
+same. Christophe Plantin, the famous printer, is the son of a simple
+peasant of Touraine.
+
+The exuberance of capitalism which reached its height in the second half
+of the sixteenth century was not maintained. Even as the regulative
+spirit characteristic of the urban economy followed upon the freedom of
+the twelfth century, so mercantilism imposed itself upon commerce and
+industry in the seventeenth and eighteenth centuries. By protective
+duties and bounties on exportation, by subsidies of all sorts to
+manufactures and national navigation, by the acquiring of transmarine
+colonies, by the creation of privileged commercial companies, by the
+inspection of manufacturing processes, by the perfecting of means of
+transportation and the suppression of interior custom-houses, every
+state strives to increase its means of production, to close its market
+to its competitors, and to make the balance of trade incline in its
+favor. Doubtless the idea that "liberty is the soul of commerce" does
+not wholly disappear, but the endeavor is to regulate that liberty
+henceforward in conformity to the interest of the public weal. It is put
+under the control of intendants, of consuls, of chambers of commerce. We
+are entering into the period of national economy.
+
+This was destined to last, as is familiar, until the moment when, in
+England at the end of the eighteenth century, on the Continent in the
+first years of the nineteenth, the invention of machinery and the
+application of steam to manufacturing completely disorganized the
+conditions of economic activity. The phenomena of the sixteenth century
+are reproduced, but with tenfold intensity. Merchants accustomed to the
+routine of mercantilism and to state protection are pushed aside. We do
+not see them pushing forward into the career which opens itself before
+them, unless as lenders of money. In their turn, and as we have seen it
+at each great crisis of economic history, they retire from business and
+transform themselves into an aristocracy. Of the powerful houses which
+are established on all hands and which give the impetus to the modern
+industries of metallurgy, of the spinning and weaving of wool, linen,
+and cotton, hardly one is connected with the establishments existing
+before the end of the eighteenth century. Once again, it is new men,
+enterprising spirits, and sturdy characters which profit by the
+circumstances.[31] At most, the old capitalists, transformed into landed
+proprietors, play still an active role in the exploitation of the mines,
+because of the necessary dependence of that industry upon the possessors
+of the soil, but it can be safely affirmed that those who have presided
+over the gigantic progress of international economy, of the exuberant
+activity which now affects the whole world, were, as at the time of the
+Renaissance, parvenus, self-made men. As at the time of the Renaissance,
+again, their belief is in individualism and liberalism alone. Breaking
+with the traditions of the old regime, they take for their motto
+"_laissez faire, laissez passer_". They carry the consequences of the
+principle to an extreme. Unrestrained competition sets them to
+struggling with each other and soon arouses resistance in the form of
+socialism, among the proletariate that they are exploiting. And at the
+same time that that resistance arises to confront capital, the latter,
+itself suffering from the abuses of that freedom which had enabled it to
+rise, compels itself to discipline its affairs. Cartels, trusts,
+syndicates of producers, are organized, while states, perceiving that it
+is impossible to leave employers and employees longer to contend in
+anarchy, elaborate a social legislation; and international regulations,
+transcending the frontiers of the various countries, begin to be applied
+to working men.
+
+I am aware how incomplete is this rapid sketch of the evolution of
+capitalism through a thousand years of history. As I said at the
+beginning, I present it merely as an hypothesis resting on the very
+imperfect knowledge which we yet possess of the different movements of
+economic development. Yet, in so far as it is exact, it justifies the
+observation I made at the beginning of this study. It shows that the
+growth of capitalism is not a movement proceeding along a straight line,
+but has been marked, rather, by a series of separate impulses not
+forming continuations one of another, but interrupted by crises.
+
+To this first remark may be added two others, which are in a way
+corollaries.
+
+The first relates to the truly surprising regularity with which the
+phases of economic freedom and of economic regulation have succeeded
+each other. The free expansion of wandering commerce comes to its end in
+the urban economy, the individualistic ardor of the Renaissance leads to
+mercantilism, and finally, to the age of liberalism succeeds our own
+epoch of social legislation.
+
+The second remark, with which I shall close, lies in the moral and
+political rather than the economic field. It may be stated in this form,
+that every class of capitalists is at the beginning animated by a
+clearly progressive and innovating spirit but becomes conservative as
+its activities become regulated. To convince one's self of this truth it
+is sufficient to recall that the merchants of the eleventh and twelfth
+centuries are the ancestors of the bourgeoisie and the creators of the
+first urban institutions; that the business men of the Renaissance
+struggled as energetically as the humanists against the social
+traditions of the Middle Ages; and finally, that those of the nineteenth
+century have been among the most ardent upholders of liberalism. This
+would suffice to prove to us, if we did not know it otherwise, that all
+these have at the beginning been nothing else than parvenus brought into
+action by the transformations of society, embarrassed neither by custom
+nor by routine, having nothing to lose and therefore the bolder in their
+race toward profit. But soon the primitive energy relaxes. The
+descendants of the new rich wish to preserve the situation which they
+have acquired, provided public authority will guarantee it to them, even
+at the price of a troublesome surveillance; they do not hesitate to
+place their influence at its service, and wait for the moment when,
+pushed aside by new men, they shall demand of the state that it
+recognize officially the rank to which they have raised their families,
+shall on their entrance into the nobility become a legal class and no
+longer a social group, and shall consider it beneath them to carry on
+that commerce which in the beginning made their fortunes.
+
+FOOTNOTES:
+
+[1] This article represents the substance of an address delivered at the
+International Congress of Historical Studies held in London, April,
+1913.
+
+[2] First edition in 1893.
+
+[3] _Der Moderne Capitalismus_ (1902).
+
+[4] R. Heynen, _Zur Entstehung des Capitalismus in Venedig_ (1905).
+
+[5] H. Sieveking, "Die Capitalistische Entwickelung in den Italienischen
+Staedten des Mittelalters", _Vierteljahrschrift fuer Social-und
+Wirtschaftsgeschichte_ (1909).
+
+[6] Davidsohn, _Forschungen zur Geschichte von Florenz_, III. 36; A.
+Doren, _Die Florentiner Wollentuchindustrie_, p. 481.
+
+[7] A. Schaube, "Die Wollausfuhr Englands von 1272", _Vierteljahrschrift
+fuer Social- und Wirtschaftsgeschichte_ (1908), pp. 39 ff. _Cf._ F.
+Keutgen, "Hansische Handelsgesellschaften", _ibid._ (1906), pp. 288 ff.
+
+[8] _Cf._ H. Pirenne, _Les Anciennes Democraties des Pays-Bas_, pp. 11
+ff.
+
+[9] I. Goll, "Samo und die Karantinischen Slaven", _Mitteilungen des
+Instituts fuer Oesterreichische Geschichtsforschung_, vol. XI.
+
+[10] A. Dopsch, _Die Wirtschaftsentwickelung der Karolingerzeit_, II.
+274. I cannot, however, accept the thesis of Mr. Dopsch on the
+importance of commerce in the Carolingian period. The extremely
+interesting texts which he has assembled seem to me to establish the
+existence of a sporadic commerce only.
+
+[11] Of course all the new towns did not grow up around an episcopal
+residence. Many of them, especially in the North and particularly in the
+Low Countries, had as their primitive nucleus a fortress (Ghent, Bruges,
+Ypres, Lille, Douai, etc.). But my purpose here is merely to recall the
+broad outlines of the subject.
+
+[12] See on this subject the interesting article by W. Vogel, "Ein
+Seefahrender Kaufmann um 1100", _Hansische Geschichtsblaetter_ (1912),
+pp. 239 ff.
+
+[13] "Unde non agriculturae delegit exercitia colere, sed potius, quae
+sagacioris animi sunt, rudimenta studuit arripiendo exercere."
+
+[14] One finds already in the twelfth century lenders of money
+undertaking veritable financial operations. See H. Jenkinson and M. T.
+Stead, "William Cade: a Financier of the Twelfth Century", _English
+Historical Review_ (1913), p. 209 ff.
+
+[15] _Die drei Bevoelkerungsstufen._
+
+[16] The _Livre de la Vingtaine d'Arras_ (ed. A. Guesnon) says, in
+speaking of the merchants of that town, in 1222, "Emunt non ad usum
+civitatis, sed ut exportent et discurrant per nondinas longinquas et per
+Lombardiam".
+
+[17] G. von Below, "Grosshaendler und Kleinhaendler im Deutschen
+Mittelalter", _Jahrbuecher fuer Nationaloekonomie und Statistik_ (1900).
+
+[18] A. Schaube, "Die Wollausfuhr Englands vom Jahre 1273",
+_Vierteljahrschrift fuer Social- und Wirtschaftsgeschichte_ (1908), p.
+183.
+
+[19] A. Duchesne, _Histoire des Maisons de Guines, d'Ardres et de Gand_,
+p. 289.
+
+[20] Rymer, _Foedera_, vol. II., part IV., p. 49.
+
+[21] For an example, see Espinas and Pirenne, _Recueil de Documents
+relatifs a l'Histoire de la Draperie Flamande_, II. 391.
+
+[22] J. Kulischer, "Warenhaendler und Geldausleiher im Mittelalter",
+_Zeitschrift fuer Volkswirtschaft_, etc., XVII. (1908).
+
+[23] G. Espinas, "Jehan Boine-Broke, Bourgeois et Drapier Douaisien",
+_Vierteljahrschrift fuer Social- und Wirtschaftsgeschichte_ (1904), pp.
+34 ff.
+
+[24] For the relations of the capitalists with the English crown see:
+Whitwell, "Italian Bankers and the English Crown", _Transactions of the
+Royal Historical Society_, XVII. (1903); and Bond, "Extract from the
+Liberate Rolls relative to the Loans supplied by Italian Merchants to
+the Kings of England", _Archaeologia_, XXVII. (1840). _Cf._ Hansen, "Der
+Englische Staatscredit unter Koenig Edward III. und die Hansischen
+Kaufleute", _Hansische Geschichtsblaetter_ (1910).
+
+[25] F. Arens, "Wilhelm Servat von Cahors als Kaufmann zu London",
+_Vierteljahrschrift fuer Social- und Wirtschaftsgeschichte_ (1913), pp.
+477 ff.
+
+[26] V. Fris, "Thomas Fin, Receveur de Flandre", _Bulletin de la
+Commission Royale d'Histoire de Belgique_ (1900), pp. 8 ff.
+
+[27] Schneider, "Die Finanziellen Beziehungen der Florentinischen
+Banquiers zur Kirche", _Schmollers Forschungen_, vol. XVII.
+
+[28] Pirenne, "Une Crise Industrielle an XVI^e Siecle", _Bulletin de
+l'Academie Royale de Belgique_, classe des lettres (1905).
+
+[29] R. Ehrenberg, _Das Zeitalter der Fugger_, I. 311 ff.
+
+[30] J. F. Jameson, "Willem Usselinx", in Am. Hist. Assoc., _Papers_,
+II.
+
+[31] See, in Cunningham, _The Growth of English Industry and Commerce in
+Modern Times_, p. 618, this citation from P. Gaskell: "Few of the men
+who entered the trade rich were successful. They trusted too much to
+others, too little to themselves." Let us recall here that the founder
+of the largest industrial establishments of Belgium, John Cockerill, was
+a simple workman. See E. Mahaim, "Les Debuts de l'Etablissement John
+Cockerill a Seraing", _Vierteljahrschrift fuer Social- und
+Wirtschaftsgeschichte_ (1905), p. 627.
+
+
+
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