Scholastic Economics

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Scholastic Economics: Survival and Lasting Influence from the Sixteenth Century to AdamSmithAuthor(s): Raymond De RooverSource: The Quarterly Journal of Economics, Vol. 69, No. 2 (May, 1955), pp. 161-190Published by: Oxford University Press

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THEQUARTERLY JOURNALOF ECONOMICSVol. LXIX May,1955 No. 2

SCHOLASTIC ECONOMICS:SURVIVAL AND LASTING INFLUENCEFROM THE SIXTEENTH CENTURY TO ADAM SMITHByRAYMOND DE ROOVER

I. Introduction:the medieval contribution, 61. - II. The school of Sala-manca, 167. - III. The demise of scholastic economics, 171. - IV. Scholasticismand mercantilism: contrast, 177. - V. Conclusions, 185.I. INTRODUCTION: THE MEDIEVAL CONTRIBUTIONShortly efore heendof thenineteenthentury,uigiCossadeplored hefact hat here xisted o work n scholasticconomics"without ome underlyingias towards ystematicefutationrextravagantpology."' Despite Cossa's owneffortso amend hissituation, herehas been very ittle mprovementn recentyears, ndscholastic conomicshas remained fieldwhich s so neglected r sopoorly cultivatedthat, n the opinion of most economists, t hardly

deservesseriousconsideration. As a result,most of the standardtextbooks n the history f economic hought if theydo notomitthesubject altogether nd startwith the physiocrats devote ittlespace to whattheycall "medieval" economics.After ome trite om-ments on Thomas Aquinas, they greet Oresme c. 1330-1382) froma distance nd thenhasten on to Thomas Mun and the theory fthebalance oftrade. Usually,the treatment s not only superficial utrepletewith errorswhich could have been avoided by going to thesources nstead of repeating lich6s.21. Luigi Cossa, An Introductiono the tudy fPolitical conomyLondon,1893),p. 141. Althoughhisbook s notanalytical,t s still xtremelyseful oritsbibliographicalnd other ccuratenformation.2. A laudable xceptions thebookofEdgarSalin,GeschichteerVolkswirt-schaftslehre4th d.; Berne, 951). Anothers, ofcourse,hegreatwork fJosephA. Schumpeter, istory fEconomic nalysis New York, 1954). Asthis rticlewas writtenndependent f Schumpeter in fact, he manuscript as sent tothisJournal efore is book appeared no referenceso his History ave been161

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162 QUARTERLY JOURNAL OF ECONOMICSAs has alreadybeen pointedout in this Journal, he currenttextbooks ntirely verlook he fact"thatAquinaswas the founder

ofa schooland thathisdoctrineswerefurtherlaborated nd refinedby hisfollowers."3 t shouldbe added that thesefollowersontinuedfar beyondtheMiddle Ages untilwell nto theseventeenthentury.Moreover,some of their mportant conomic doctrinesweretakenover, withonly slightmodifications, y the philosophers f naturallaw, such as Hugo Grotius (1583-1645) and Samuel Pufendorf(1622-94),who werestill Aristotelians,veniftheywere opposedtoscholasticism.Since the later scholasticwriters uilt on the foundationsaidbytheirpredecessors,t appearsnecessary o say a fewwords boutthe method used by the medievalSchoolmenand about theireco-nomiccontributionsf a technicalnature. The author ssumesthattheircontributionsn a broadersense are known, n spite of thelimited reatment ccordedthe subject n mosthistories feconomicthought.No more hantheauthors f ntiquity, idthemedievalSchool-

men consider oliticaleconomy s an independent iscipline, ut asan appendixto ethicsand law.4 This situation till persisted n theeighteenth enturywhen Adam Smith took chargeof the chairofMoralPhilosophyt GlasgowCollege. The courses fhispredecessor,FrancisHutcheson 1694-1746),and his contemporaryt Edinburgh,Adam Ferguson 1723-1816), are available in print. According othese sources,the contentsof a course n Moral Philosophy n theeighteenthentury nd in Presbyterian cotlandstillcorresponded,by and large,to the description fthe subjectmattergiven n thethirteenthentury yThomasAquinasinhisCommentsn theEthicsofAristotle.5Economics, n themodern ense,occupieda very sub-ordinateposition nd was stillviewedas an ethicaland legalmatterinvolving heapplicationofnatural aw to civilcontracts.What the Doctors in the Middle Ageswerereally nterestednwas to determine he rules of justice governing ocial relations.FollowingAquinas,theydistinguishedwo kindsof ustice:distribu-added. The readermaybeinterestedncomparinghis ssaywith chumpeter'sremarks nd conclusions.He willfind differentreatmentf the subject, utfundamentalgreementn various oints.3. R. de Roover, MonopolyTheoryprior o Adam Smith: Revision,"thisJournalNov. 1951),p. 493.4. I avoid using heterm economics"here,because in the Middle Agesit still retained he samemeaning s in antiquity nd referredo householdmanagement.5. ThomasAquinas,n X librosthicorumd Nicomachum,, 1.

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SCHOLASTIC ECONOMICS 163tive justice,which regulated hedistributionf wealth and income,according o the place of the ndividual n society, nd commutativejustice,which pplied to the reciprocal ealingsbetween ndividuals,that s, to the exchangeof goods and services. In otherwords, co-nomic matterspertained o justice,not to charity, s can be readilyascertained by merely runningthroughthe table of contentsofAquinas' Summatheologica.In dealing with questionsof justice,the Doctors unavoidablyhit upon economicmatters nd wereforced o consider hem. Atfirst heir nvestigationwas limited o the just priceand usury,butit soon branchedout to involvea host of otherquestions, ncludingthe just wage, debasement (inflation), ustice in taxation, publicdebts, monopoly,foreign xchange,partnerships,nd all the con-tractsthat might nvolveany taintofusury.The medieval mind was legalistic and, underthe influence fRoman law, a greatdeal of mportancewas attached to theform fcontracts. The principalproblemwas always to determinewhethera contractwas licit or illicit. This emphasis tended to narrow hescope of economics o the study ofthe legal natureofcontracts ndtheir thical mplications, tendencywhichreflectstself ven nthetitle nd the arrangement f scholastic reatises. One will be suretofind conomicmattersdiscussed along withother opics,ofcourse- in any treatiseon moral theology earing s titleDe contractibus(Concerning ontracts)or De justitia et ure (Concerning ustice ndLaw). Almost nvariably conomic ubjects are also touched uponin guides forconfessors,hough he exposition n worksof this typeis likely o be less systematic nd analyticaland more casuistic. Asa matterof fact, the word "casuistry" derivesfrom he concernofthelate scholasticwriterswith cases ofconscience.Thomas Aquinas (1226-1274) had givena place to economicsin his universal cheme: t was ruled by justice and grounded n pri-vate property nd exchange. In any case, the pursuitofmaterialwelfarewas not to be regarded s an end in itself, ut as a means toachieve the summum onum f salvation.7 These fundamental rin-cipleswereneverquestionedbyhisfollowers, ut practicalnecessitiessoon spurred hem to elaborate his rather ketchy nalysis on usuryand price. The firstwho refined t considerablywas JohnBuridan(1300-1358), pupil ofWilliamofOckham nda rector fthe Univer-

6. Idem, umma heologica,I, ii,quaest. 61, arts.1 and 2.7. Ibid., II, ii, qu. 55, art. 6, and Summacontra entiles,II, c. 30. Cf.Aristotle, icomacheanthics, , 5 and 8.



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164 QUARTERLY JOURNAL OF ECONOMICSsityofParis. He insistedon the pointthatvalue was measuredbyhuman wants: not by those of a single ndividual,but by those ofthe entirecommunity rei venalis mensura st communesndigentiahumana).8 He made it clear,also, that he considered he marketprice as the just price. Buridan's analysis even anticipates themodernconcept of a consumer cale ofpreferences,incehe statesthat the person who exchanges horse formoney would not havedone so, ifhe had notpreferredmoney o a horse.After uridan,the nextwriter f mportancewas theFlorentinejuristand diplomat,MesserLorenzodi AntonioRidolfi 1360-1442),who n 1403wrote treatise n usury.9 It contains he first etaileddiscussion fforeign xchange. Of course,he deals withthesubjectfrom he scholasticpoint ofview, which s radicallydifferentromthe latermercantilist r balance-of-tradepproach.' The questionraised byRidolfi s whether xchangedealings are lawfulor involveusury.Lorenzo Ridolfi was followed by the famous preacher, SanBernardino fSiena (1380-1444), whomProfessor dgar Salin con-siders s one ofthe mostnotable economists fall times.2 As sourcesofvalue, he lists threefactors:utility virtuositas),carcity raritas),and pleasurablenesscomplacibilitas). He also mentions hat goodsmay be more or less gratifying,ccordingto the intensity f ourdesire to possess and to use them. Withoutstretchinghese state-mpnts oo far, t seems to me that San Bernardinohad undoubtedlya psychological heory of value and even some inklingofvaryingdegrees futility. According o him,the ust price s determined y"theestimationmadein common yall the citizens fa community"(aTstimatio communitatibusivilibus facta communiter).In myopinion, his is clearly he competitive rice n a freemarket. Thecorrectness fthis nterpretations beyond uestion, inceBernardino

8. Edmund chreiber, ie volkswirtschaftlichennschauungener cholastikseitThomas onAquin Jena, 913),pp. 178-86.9. Tractatus e usuris tmateriaemontis1st ed.; Pavia, 1490); republishedinVol. VII of the Tractatusniversiuris (Venice, 583),fols.15r-50r.1. R. de Roover,Gresham n Foreign xchange; n Essay on EarlyEnglishMercantilismCambridge,Mass.: HarvardUniversityress,1949), pp. 173-80,andL'4volutione a lettree change, IVe-XVIIIe sikxlesParis: Armand olin,1953),pp. 51, 58-60, 127-29.2. Op. cit.,p. 45. There are tworecentmonographs n the economics fSan Bernardino: ranzJosefHtinermann,ie wirtschafts-ethischenredigteneshN.Bernardin on Siena (Miinster, 939) and AlbertoE. Trugenberger,anBernardino a Siena, Considerazioniullosviluppo ell'etica conomiccristiananelprimo inascimentoBerne, 951). The sermons fBernardino fSiena deal-ing witheconomics re in his collection, e EvangelioAeterno, os. 32 to 42.



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SCHOLASTIC ECONOMICS 165is outspokenn his condemnationfmonopolistic ractices, hat s,of "fraudulentnd perniciousgreements"ywhichmerchants riveup prices n order o increase heirprofits.Finally, an Bernardinostatesthatthe "difficulty"f producing goodmakes t scarcer ndmorevaluable. Does he implythat the cost ofproduction eter-mines priceby affectinghe supply? An interestingoint s that"difficulty,"nsteadof supply,appears in the lecturesof FrancisHutcheson,Adam Smith'steacher, s a price-determiningactor.The concept s notused in TheWealth fNations,but it reappearsinRicardo'sPrinciples fEconomicschap. 20) where t is said thatvalue dependsuponthedifficultyr facility fproduction, hich sapparently ynonymous ithmoreor less labor. In his Logic ofPolitical Economy,Thomas De Quincey (1785-1859), tryingtoimprove ponRicardo,recognizeswosourcesofvalue: utility nddifficultyf attainment. His discussion s quoted at lengthandwith pprovalbyJohn tuartMill inhisPrinciples fPoliticalEcon-omy Book III, chap. 2, ?1). These observationsead to two con-clusions. First, hepersistentse of the same terminologyoints oa continuedradition.Second,t seems hat hispartofvalue analysismade ittle,fany,progressromhetimeofSan BernardinooJohnStuartMill. On the contrary,t might ven be arguedthat thelatter's nalysis s inferior,ecause tis lessexplicit n thepoint hatdifficultyreates carcity.Although an Bernardino, ike the other Schoolmen, egardsmoney s sterile,he contradicts imself lsewherewhenhe admitsthat tacquires seminal ualityby becomingcapital."3 Bycapital,he does notmean theprincipal f a debt,but money nvested n abusinessventure. The same contradictions found n ThomasAquinas,who, n one passage,affirmshatmoney s barren nd, inanother, ompares t to seedwhich,fput into thesoil, willsproutandproduce crop.'San Bernardino lso mentions ambium nd governmentebts,buta better iscussion f thesetopics s foundn the writingsfhiscontemporary,an Antonino1389-1459),ArchbishopfFlorence.6

3. ErnestNys,"The Economic heories f theMiddleAges,"Researchesin theHistoryfEconomicsLondon, 899),p. 164.4. In thismeaning,heword capital" s already sed n notarial ndbusi-nessrecordsrom he welfthenturynward.Numerousxamplesccurn thecartularyfGiovannicriba, rJohn heScribe,whichontainsctsdating rom1154 o 1164 II cartolarei Giovannicriba, d.MarioChiaudano, urin, 935).5. Summa heologicalI, ii, qu. 61,art.3. Elsewherequ. 78,art. 1), quot-ingAristotle, quinasstatesthat moneywas inventedmainly o serve s amedium f xchange.6. On San Bernardinond San Antonino,ee also Amintore anfani, eorigindello pirito apitalisticon Italia (Milan,1933),pp. 106-19.

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166 QUARTERLY JOURNAL OF ECONOMICSAlthoughnot a veryoriginal hinker, an Antoninowrotewith easeand was wellversed n the extant anonisticnd theological iterature.His workscontainan excellent ummary f the controversy,henraging, bout the lawfulness finterest-bearinghares n thepublicdebt. With regardto value and price,he takes over the theory fSan Bernardinowithoutmodification;yet he has often receivedundeserved redit s the first o mention tility.7The last of theimportant conomicwriters f the MiddleAgesis Thomas de Vio (1468-1524), betterknownas CardinalCajetan.8His work n the field feconomicsncludesthreebrief reatises:oneon usury, nother on cambium, nd a thirdon the MontesPietatis,whichhe bitterly pposed. The mostremarkable fthe three rea-tises s perhapstheone on cambium,nwhichhe showshimselfwell-informed n bankingpractices. In conformity ith scholasticdia-lectics,he defines ambium s a permutationne of the nominate on-tractsfound nRoman law, and not as a mutuum. Thus he justifiedreal exchangeprovided hat the place differencee observed, hat s,that thebillofexchange e issued n oneplace and payable nanother.Dry exchange,a practice without analogy in modern business, sproscribed ecause it is a faked exchangetransaction iolatingthisrule.9This brief nd incomplete urveyomits the minorSchoolmen,someof whomare notwithout nterest. The authors discussedareall menofsingularmerit, ustly famousfortheir chievements, otmerelyn economicsbut chieflyutside thisfield.A grave shortcomingf the medievalas well as the ater School-men s their veremphasis ftheusuryquestion. The space devotedto it in scholastic reatiseshas given themistaken mpressionhat twas regarded s all important. Sir WilliamAshleyevenassertsthat"theprohibitionfusurywas clearly hecentre f the canonistdoc-trine."' This is untrue. As stated above, the Schoolmen onsideredequityin distributionnd exchangeas the centralproblem n eco-7. On the conomic octrinesf an Antonino,hererethefollowingtudies,noneof outstandinguality:Carl Jigner, ie volkswirtschaftlichennschauungenAntoninson lorenz Paderborn, 904); Bede Jarrett,an AntoninondMediae-valEconomicsSt. Louis,1914);and August fister, ie Wirtschaftsethikntonin'svon lorenz1389-1459) Fribourg, witzerland,946).8. DeMonte ietatis 1498),De cambiis1499),De usura 1500); republishedrecentlyn Scriptaphilosophica,puscula economico-socialia,d. P. P. Zammit(Rome,1934).9. R. de Roover, What s Dry Exchange? A Contributiono the Study fEnglishMercantilism," ournal fPoliticalEconomy,II (1944), 250-66.1. An Introductiono English conomic istory nd Theory, ol. I, Part 2(9th mpression,ondon, 920),p. 395. Cf. bid.,p. 382.



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SCHOLASTIC ECONOMICS 167nomics. The usuryquestionwas a side issue, but concernwith twas allowed to crowdout nearly verythinglse.2

II. THE SCHOOL OF SALAMANCABy many authors,GabrielBiel (c. 1435-1495), professort theUniversity f Tiibingen, s consideredthe last of the Schoolmen.Actually,scholasticismdid not die with him; on the contrary, treceived new lease on life n thesixteenth entury. This regenera-tion was the work of the school founded by Francisco de Vitoria(1480-1546), who,from 526 to 1544, taught t Salamanca - in thisperiod,the queen ofthe Spanishuniversities.As a matteroffact,the term"the schoolof Salamanca" is often pplied to thebodyofhis students,his disciples and theirsuccessors.3 From Spain, theinfluence f Franciscode Vitoria's teaching pread to Portugal (totheUniversity fCoimbra),to Italy (through he Roman collegeofthe Jesuits),and to the Low CountrieswhereLeonardus Lessius(1551-1623),Franciscus ylvius rdu Bois (1581-1649), nd JohannesMalderus (1563-1633) wrote commentaries n Thomas Aquinasinspired y theSpanish doctrines.

The schoolofSalamanca distinguishedtself n philosophy ndin natural and international aw. The treatises of Francisco deVitoriaon the Indies and on thelaws ofwarhave even beenrepub-lishedby the CarnegieEndowmentfor nternational eace.4 SomeofVitoria'spupils occupiedprominent ositions:Domingode Soto(1494-1560) represented harles V at the Council of Trent and in1548became theEmperor's onfessor; iego de Covarrubiasy Leyva(1512-1577), whowrotea treatiseon money,was appointedBishopof Ciudad Rodrigoand later President of the Council of Castile;5Martin de Azpilcueta,betterknown as Navarrus (1493-1586), wasrectoroftheUniversity f Coimbrabeforebeing called to Rome in1567, wherehe enjoyedtheconfidence f three uccessivepopes anddieda nonagenarian. Among hose nfluencedndirectly yFrancisco2. Onusury, yfar hebest tudy vailable n English sthe rticle fT. P.McLaughlin, The Teachings f theCanonists n Usury XII, XIII and XIVCenturies),"Mediaeval tudies, (1939),81-147, nd II (1940),1-22. Cf.Ben-jaminN. Nelson,The dea ofUsuryPrinceton:rincetonniversityress, 949).

3. MarjorieGrice-Hutchinson,he chool f alamanca, eadingsnSpanishMonetary istory,544-1605 Oxford: he Clarendon ress,1952). Althoughnotwritten ya professionalconomist,his s an excellentittle ook.4. De Indis etde urebell: RelectionesWashington,. C., 1917). No. 7 oftheseries:The Classics f nternationalaw.5. VeterumumismatumollatioSalamanca,1550).6. OnAzpilcueta here s a studybyAlbertoUllastres alvo, "MartindeAzpilcuetay su comentarioesolutorioe cambios; as ideas ec6nomicas e unmoralistaspaftol elsigloXVI," AnalesdeEconomia, (1941),375-407, nd II(1942),52-95.

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168 QUARTERLY JOURNAL OF ECONOMICSde Vitoria,mention houldbe made also ofLuis de Molina (1535-1601), who occupiedformorethan twenty earsthe chairof theologyat the University f Evora in Portugal. His analysis of value andprice is especially valuable for ts comprehensiveness.7 ince eco-nomics was not recognized s an independentdiscipline, t is notsurprisinghat the membersof the school of Salamanca achievedgreaterdistinction n otherfields,but this is no reason why theyshouldbe ignored y economists r denied theirdue.In formand content, he treatisespublished by the Spanishschoolcontinue he scholastictraditionwith ts constantappeal toauthority,ts displayofreferenceso supporteven the most trivialstatements,nd its love ofsubtledistinctions nd definitions.8Asin the past, attention emained ocused n the observance f the rulesof usticeand on thelawfulness fvarious types of contracts. Themoralistsof the new school, however, ttempted to provide freshinterpretations,orefineheir oncepts, o elaborate heir nalysis, oobservemarket onditions,nd tobring heir rinciplesomehowntoharmonywiththe requirements f expandingbusiness and finance.Without hanging ompletelyhescholasticmethods fanalysis, hetaskwas by no means an easy one. No wonder hat thecasuistsoftheSpanishschoolwereonlyhalf uccessful; heyrevitalized cholas-ticism,t is true,butonlyfor time,without aving tfrom ltimatedoom.9Even more than the medieval Schoolmen, the later Doctorsadheredto thetheory hat utilitywas the main sourceofvalue andthat the just price, n the absence ofpublic regulation,was deter-

7. BernardW. Dempsey,nterestnd Usury, ith n IntroductionyJosephA. Schumpeter.This work iscusses hetheoriesfthree choolmen,ll belong-ingto, or nfluencedy,the school fSalamanca:Molina,Lessius nd Lugo. OnMolina,there s an unpublished octoral issertationy W. Seavey Joyce, heEconomics fLuis de Molina HarvardUniversity,948).8. Grice-Hutchinson,p. cit., p. 40. Nevertheless, arl J. Hamilton(American reasure nd the rice Revolutionn Spain, 1501-1650, . 295) labelsTomAs e Mercado nd others s "Spanishmercantilists." his abel s certainlywrong: venthetitle fMercado's reatise,ummade tratos contratosemerca-deres 1st ed.; Salamanca, 569), ndicates learlyhat he approach s scholastic.Moreover, panishwriters o not considerMercado nd other uthors elongingto the schoolof Salamanca as mercantilists,ut call them usnaturalistasndmoralistas,hichscorrect,nmy pinion: os6 arraz,La 6poca elmercantilismoenCastilla, 500-1700 2d ed.; Madrid, 943),pp. 119, 122, nd 131. Cf Andr6sV. Castillo,Spanish Mercantilism: er6nimoe Uztariz, conomistColumbiaUniversity ress,1930),p. 45.9. Withreferenceo the philosophicalestorationnitiated y the school fSalamanca, he ameviews re expressed yMauriceDe Wulf, istory fMediae-valPhilosophy,I, 301-7.



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SCHOLASTIC ECONOMICS 169minedby common stimation,hatis, by the interplay fthe forcesof upply nd demandwithout nyfrauds, estraints,rconspiracies.'Domingo de Soto and Luis de Molina both denounce s "fallacious"therule formulated y JohnDuns Scotus (1274-1308), according owhich he ust price houldequal the costofproduction lusa reason-able profit.2Tomas de Mercado makes thepertinent emark hatprices areas changeable s thewind.3 Molina even introduces he conceptofcompetition y statingthat "concurrence" r rivalry mong buyerswillenhanceprices, ut that a flaggingemandwillbring hemdown.4Since similar tatements re found nother uthors,we mayconcludethat the Doctors ofthe new schoolgenerally ccepted the idea thatthe just price, f not fixedby publicauthority, orresponded o thecurrent rmarketprice.5Conditionsofsupplyand demandare not the onlyfactors hataffect rices. There s also the nfluencef the volumeofcirculatingmedia on the pricelevel. The Spanish authors take the quantitytheoryfor granted, ince theirtreatises, lmost withoutexception,mention hat prices go up or downaccording o the abundanceorscarcityof money.6 Twelve years beforeJean Bodin, or in 1556,Azpilcuetaor Navarrus, attributes herise of Spanishprices to the

1. Luis de AlcalA,Tractado e losprestamosuepassan entremercaderestractantesToledo,1546),Part , ? 5,fol. v; Part I, ? 11,fol. 2-23;LuisSaraviade la Calle, nstrucione ostratos elcomprar venderMedinadel Campo,1544),cap. 2; TomAs eMercado, p. cit., ib. 2, cap. 8; Domingo e Soto,De justitia tjure (1st ed.; Salamanca,1553), ib. VI, quest. 2, art. 3; Luis de Molina, Dejustitia t ure (Cuenga,1592),tract. I, disp. 348, ? 8. Cf.Grice-Hutchinson,op. cit., p. 49, 72, 79, 82,88. Sotoexpresses he rule s follows:ensus rgo stquodtantumalet esquanti endi otest,eclusa i, raude tdolo.2. Soto, op. cit., ib.VI, qu. 2, art. 3; Molina,op. cit., ract. I, disp.348,?8; and Mercado, p. cit., ib. 2, cap. 11. Cf. BernardW. Dempsey, Just Pricein a Functional conomy,"American conomicReview, XV (1935), 471-86.3. Op. cit., ib. 2, cap. 8:. . . Aunque s mas variableseguina experienciaenseia) queel viento.4. Op. cit.,Tract. II (de contractibus),isp. 348, ?4: Multitudomptorumconcurrentium,lusuno emporeuam lio, tmaioreviditatefacitretiumccrescere;emptorumero aritas acit lluddecrescere.5. Grice-Hutchinson,p. cit., p. 48,80, 86-87, 105.6. Molina, forexample, tatesthatprices nd wages will be highern acountry heremoneys abundanthan nanother heret sscarce op.cit., ract.II, disp. 348,?4). Cf.Grice-Hutchinson,p. cit., p. 80, 105;Mercado, p. cit.,lib.2, cap. 11; Cardinalde Lugo quotedby J.Brodrick, he EconomicMoralsof theJesuits, . 10. Cf.BernardW. Dempsey, The Historical mergence fQuantity heory," hisJournal, (1936),174-84, nd the"Comments" heretoby E. J.Hamilton,bid.,185-92. Thesecomments nly llustratehe factthateconomistsook in thewrong laces forbibliographicaluidance n scholasticeconomics.



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SCHOLASTIC ECONOMICS 171Piacenza, on the nitiative f the Genoese bankerswhomonopolizedthe financialbusinessof the Spanish crown. To a certainextent,thesefairswereinstitutions alled forth y the scholasticdoctrine,since t condemned hediscounting f credit nstrumentsutdidnotfrown pon dealings n foreign xchange,unless theywere overtlymisused oevade theban againstusury. Thus theexchange usinessat the fairsbecame one of the main preoccupations fthe moralists.The copiousworks ftwo taiians,Sigismondo caccia (c. 1568-1618)and Raphael de Turri c. 1578-1666),not to speak of minor reatises,deal exclusivelywiththis topic. The principalbone of contentionwas the awfulness f hecambio on a ricorsa, devicewhichnvolveddrafts nd redrafts oingback and forth etweenGenoa or anotherbanking lace and thefairs fBesangon.2To befuddle hetheologians,thebankershadshrouded hecambio on a ricorsa n a veilof echnicaljargon and complicated ookkeeping. Strippedof ts trappings,hecambio con la ricorsa oses all its mystery: n its naked form t issimply discount cleverly concealed under the formof fictitiousexchange ransactions.Nevertheless, he theologians nd the urists,approaching heproblem rom legal pointofview,found hemselvescaught na web oftechnicalitiesnd contradictions hich ontributednot a littleto thediscredit f scholastic conomics.In economics, hescholasticdoctrine eaches ts fullmaturitynthemonumentalworksof Cardinals Juan de Lugo (1583-1660) andGiambattistade Luca (1613-1683), who should not be mistaken neforthe other, lthoughthe similarity n name leads to confusion.'Despite an impressive isplay of scholarship, heirworks ll concealthe fact that the Doctors had exhausted the possibilities f theirmethodand that further rogressno longer dependedupon moreelaboration and refinement, ut upon a completerenewalof theanalytical pparatus.

III. THE DEMISEOFSCHOLASTIccONOMICSThe demise f cholasticisms not imited oeconomics, fcourse,but involves he entire cientificnd philosophical ystem orn nthemedievaluniversitiesnd still far frommoribund n the eve oftheseventeenth entury. The skepticism f theRenaissance, t is true,had sapped the strengthf the scholastic ystembut withoutbeing2. Ibid.,pp. 80-81,for n example f ambio on a ricorsa.Furthernforma-tion sfound n therecent ookofGiulioMandich, e pacte eRicorsa t emarchitaliendes changes u XVIIe siecle Collection Affaires t Gens d'affaires,"No. 7, Paris: Armand olin,1953).3. The work of Cardinal de Lugo, Disputationescholasticae t morales(Lyons,1642), was republishedn 1869. VolumeVII (in quode contractibusn



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172 QUARTERLY JOURNAL OF ECONOMICSable to destroy he still vigorousorganism. Althoughderided andridiculed by its opponents,scholasticism ontinuedto exert far-reachingnfluence.It was confronted,owever,with n increasinglyhostile pirit,whichprovided favorable limatefor hereception fCartesian philosophy. The real crisisdid not come untilthe seven-teenth entury. In the faceof the attack,theAristotelians ailedtorealizethat, in order to survive, heyhad to renew theirmethods.Instead, they stubbornly efused o accept the new discoveries nexperimentalcience,withthe nevitableresult hattheirphilosophysharedthe fateof their ntiquatedastronomy, hysics, ndmedicine,and along with them,fell nto completediscredit.4On the continent fEurope, and to a lesser extent n England,thedyingAristotelian ystemkept tshold on the universities, hichthusbecame asylumsforold fogies nd citadelsofbigotedpedantry.Learningdeserted his musty nvironmentnd found haven in theacademiesand in the salonsof the eighteenthentury.It wouldbea grievousmistake oview theevolution feconomicsas divorcedfrom hat of the other ciences. The main reason whyscholastic conomicsdecayedwas that its adherentswereunable orunwilling o revamptheir ystem nd to discardthe dead wood inorderto preservewhat was worthpreserving. Nothing llustratesthisfailure etter hanthework fthe ate casuistsoftheseventeenthcentury,uchas the treatise f Raphael de Turri. In it, thescholasticdoctrine n the cambium ontractreachedmaturity, ut the subtledistinctions etween icit and illicitexchangefail to cover up thefallacies nd theinconsistencies hichunderlie he wholeargument.Whyshouldone form fexchangebe lawful nd not another? Onecan only agreewith themercantilistMalachy Postlethwayt,who in1751 declaredthatthe lawyers nd divineswith"theiruselessnice-ties" and "theirfanciful ivisions nd subdivisions,"nsteadof clear-ingup the matter, ad "onlyperplexed nd confoundedt."' Alreadyin thesixteenth entury, heDominicanfriar, omingode Soto,hadsoundedthe alarmbystating hat "thematter fexchange, lthoughgenere t n specie gitur) ontains he partdealingprincipally itheconomics.Cardinal eLuca wrote popularwork n thevernacular,I dottorolgareRome,1673,9 vols.),which, s thetitle ndicates, as designed o explain hedoctrineofthe Doctors o thepublic. He is also theauthor f a Latin treatise, heatrumveritatist ustitiaeRome,1669-1681, 1 vols.) written nlyfor cholars.4. MauriceDe Wulf, p. cit.,I, 309ff.The late author, pupil fCardinalMercier,was professort the CatholicUniversity f Louvain and at HarvardUniversity.5. "Bill of Exchange,"The Universal ictionary fTrade and Commerce(2d ed.; London,1757),p. 277.



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SCHOLASTIC ECONOMICS 173sufficientlybstruse n itself,s beingmore nd moreobscuredby theclever subterfugesfthe merchants nd the contradictory pinionsoftheDoctors."6 But he himselfwas a prisoner f his method ndcouldnot escapefrom he impasse.There was nothing asicallywrongwiththescholastic heory nvalue and price. It restedon utility nd scarcity, nd AdamSmithdid not improveupon it.7The greatweakness of scholastic conomicswas theusurydoc-trine. Canon law, dating as it does back to theearlyMiddle Ageswhenmost oansweremade for onsumptionurposes, efined suryas any increment emanded beyond the principalof a loan. Sincethis definitionwas a part of Catholic dogma,the Schoolmen wereunableto change t. As timewentby, tbecamea sourceof ncreas-ingembarrassment.Tied to their efinition,he Doctors were uckeddeeper and deeper ntoa quagmireofcontradictions. t is not thattheChurcheverseriously amperedbusiness nvestments, ut prac-tical necessityplaced before he moralists he well-nigh mpossibletask of egitimizingmeansfor aking nterestwhilesafeguardingheprinciple hat loans were gratuitous ontracts. This difficulty assolved n twoways: (1) bythedoctrine fextrinsicitles, nd (2) bythe rather rtificial istinction etween icit and illicit ontracts. Inthe sixteenth entury, he more lenientamong the casuists under-mined heir wnposition tillfurther ypermittinghetriple ontract,accordingto which the borrower uaranteedto the lendera fixedreturn f, et us say, 5 per cent a year.8 In the end, the awfulness finterest ecamea questionof formality,hat s, of drafting ontractsin the proper orm. Is it then urprisinghatcasuistry cquired sucha bad connotation nd is today synonymouswith sophistry ndmentalreservation?6. Op. cit., ib. 6, qu. 8, art.1. Thistextwascopied by other octors, eedeRoover, '6volution,. 72.7. Emil Kauder,"Genesis f the MarginalUtility heory:FromAristotletotheEnd of heEighteenthentury,"conomic ournal.LXIII (1953), 38-50;idem, The RetardedAcceptanceftheMarginalUtility heory," hisJournal,LXVII (1953),564-75.8. The triple ontract, s thename indicates,nvolves combinationfthree ontractsn one: (1) a partnershipontract etween he lender nd theborrowerharingnprofit nd loss of theborrower'susiness,2) an insurancecontract y which heborroweruarantees estitutionf the capital,and 3)another nsuranceontract ywhich heborroweruaranteeshe ender gainstany loss, fthe latterforegoes is share n eventualprofits,n exchange orfixed ut reduced eturn n his investment.Although he triple ontract adbeencondemned,n 1586,by SixtusV (1585-1590), he casuists ontinued odebate ts awfulnesshroughouthe eventeenthentury. Usure,"DictionnairedeThdologieatholique, V (1948), cols.2373-74.



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174 QUARTERLY JOURNAL OF ECONOMICSFrom hestart, heusury octrineecame n easytarget ortheopponentsfscholasticism.n a certainway,theDoctorshad

only hemselveso blame:bytheirnconsistencies,hey adexposedthemselvesocriticismndevenridicule.The firing as openednthe sixteenthentury ith hefierceattack fCharles uMoulin 1500-1566), ho dvocated he olera-tionofa moderate ateof nterest.He pointed utthattheusuryprohibition,eant oprotecthedebtor, adtheopposite ffectyincreasinghecostof ending.Notcontent ithmarshalingeriousarguments,epoked un t the"jargon" f heDoctors ndat theirclassificationf cambiumntoreal,dry,and fictitiousxchange,rechangend"counter-change."9u Moulin's ookwasprematureandexposedtsauthor opersecutionorheresy.In the eventeenthentury,heblast ame romnotheruarter;this ime hecasuistswere riticized,otfor heir igor utfor heirleniency, y theJansenist,laise Pascal (1623-1662), llustriousphilosopher,athematician,nd physicist, ho,by theexcellencyofhis tyle,won name or imselfnFrenchiterature. isLettresProvinciales erescurrilousamphlets,hat created n enormoussensation. n theeighthetter, eattemptso confutehecasuistsfor heir pinion nusuryndcontracts.Ofcourse, ascalwasanamateurneconomics,s well s intheology.Nevertheless,here snodenyinghathiscastigationasnot ntirelyndeservedndthathis victimshad made concessionsnconsistent iththeirbasicprinciples.'During heeighteenthentury,heattack ontinues nabated.Wheneverhe Philosophesefer o the Doctors,theycall them"casuists"with nundertonef corn ndcontempt.Theyreferothem nly ocriticize;nd when hey orrow romhem,hey onotgive hemny redit.This ttitudestypical f heAge fEnlighten-ment,which howedno appreciationf Gothiccathedrals r ofthingsmedieval,ngeneral.More thanever,theusurydoctrines the center f attack.AccordingoTurgot1727-1781), heprejudicegainstnterest adbeen ntroducedincenturiesf gnorance"ytheologianshodid9. Charlesdu Moulin,Sommaire u livre nalytique es contracts,suresrentesonstitutes,ntereststmonnoyes,nOmniaquae extant pera Paris,1681),Vol. II, No. 73: "Je aisse aussi eurs argons t distinctionse change 6al,fictet sec,rechange t contre-change." f.deRoover, '6volution,. 195.1. To bespecific,refero thecommentsfPascal on theMohatra ontract,one of the subterfugessed in Spain. Pascal's mainvictimwas the casuist,Antonio scobar y Mendoza,whosemajorwork s Universaeheologiae oralsreceptores1sted.; Lyons,1652, vols.).



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SCHOLASTIC ECONOMICS 175not "understand hemeaningof theScriptures ny better hantheprinciples fnaturallaw."2 RichardCantillon d. 1734) remarkedsarcastically hat lucrum essanswould entitle man making "fivehundredper cent" in his business to demandthe same fromhisborrowers.3Abbe de Condillacfranklyomesoutwiththeassertionthat the loan at interests just and should be permitted. He goeson tostate that egislatorsnd "casuists" are confused n thesubjectand asks thempointedlywhytheydisapproveof nterest nd not ofexchange.4 Is therereallyso much differenceetween distanceintime (distance e temps) nd distance ofplace (distance e lieu)? InFrance,duringthe eighteenth entury, he law stillproscribed hetaking f nterest,lthough hispracticewas generally oleratedwiththe connivance fthe courts. The physiocrats agedanunsuccessfulcampaignforthe enactment f a statute whichwould legalizecon-tractualclausesstipulatinghepayment f nterest. Such a lawwasnotpassed untilOctober12, 1789,after heoutbreakoftheFrenchRevolution.In Italy,the attack on theusurydoctrinewas even more nsidi-ous than nFrance,since twas carried n under thecoverofortho-doxy. In 1744,there ppeareda book nwhich heauthor,MarquessScipioneMaffei1675-1755),pretended,n thesurface,odefend hetraditionaldoctrines,but, in the last chapters,ruinedthe entireedificeby advocatinga new extrinsic itle,neveradmittedby thetheologians: helexprincipis, hat s, the aw orcustomofthe and.'As a matter ffact,thepurposeofthebook was to justify heissueby the cityof Veronaof a municipal oan yieldingnterest t 4 percent. Maffei's ublication reated ucha stir hat norder oappeasethe tempest,Pope Benedict XIV (1740-1758) was impelledto pro-mulgatetheencyclicalVix Pervenit1745), whichreasserted orthelasttime he olddogmawithrespect ousury.6Within fewmonths(1746), thereappearedthe secondedition of Maffei'sbook without

2. "R6flexionsur a formationt la distributionesrichesses," euvreseTurgot, d. GustaveSchelle, I (Paris,1914), 577-78, ?LXXIII:" Erreurs esscolastiques 6fut6es";nd "M6moire ur es pretsd'argent" 1770); ibid., II(Paris,1919), 163. Cf. Jean FrangoisMelon, Essai politique ur le commerce(Paris,1761),pp. 259 and 272.3. Essai sur a nature u commercen general,d. Henry Higgs (London,1931), pp. 208-10.4. Le commercet le government onsiddrdselativement'un a' Vautre,nMelanges '6conomieolitique,d. EugbneDaire (Paris,1847), , 311-12.5. Dell'impiego eldanaro, ibri re 1st. ed.; Rome, 1744; 2d ed.; Rome,1746).6. de Roover L'6volution,p. 123-24n.) givesa summaryn Frenchofthe five oints iscussedn VixPervenit.



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176 QUARTERLY JOURNAL OF ECONOMICSany substantialmodification f the author's stand on the usuryquestion. Yet this second editionpublished n fullthe text of theEncyclical,bore the mprimaturfthe ecclesiastical uthorities,ndcontained dedicatoryetter o BenedictXIV, a personalfriend fthe author. On scholasticism, he book of Maffeihad a deleteriouseffect, ince it implicitly edefined suryas any incrementnotbeyondtheprincipal but beyondthemoderateate allowedby aworcustom.7The new definition epresented radical departure fromthebasic normsof scholasticeconomics.8 Books challenginghe thesisof Maffei nd restating hescholastic raditionwere stillbeingwrit-ten in the beginning f the nineteenth entury, ut theirauthorswere not men of any talent and they repeatedthe old, worn-outargumentswithout ontributingnythingnew.9 Scholasticismhadceasedtoattract he best minds: tsdiscredit,xcept nultra-conserv-ative circles,was too profound.After heCodeNapoleon, dopted all over western urope, hadallowed the takingofinterest, he Church, oo, decided to abandonthe old usurydoctrine. It was quietlyburied in 1830, when theSacred Penitentiaryssued instructionso confessors ot to disturbpenitentswho lentmoneyat the legal rate of interestwithout nytitle other than the sanctionof Civil Law.' With this decision,

7. The same thesiswas defended y theJansenist, icolasBroedersen,nhis book,De usuris icitis t llicitis1sted.; 1743). Abb6Ferdinando aliani nhis book,Dellamoneta, evotes o usury n equivocal hapter,n which epaysat least lip service o the traditional octrine. See Arthur li Monroe, arlyEconomic hought,electionsrom conomic iteraturerior o AdamSmith, p.300-7. AntonioGenovesi 1713-1769) n his book, Lezionidi economia ivile,adoptsthe samepoint fview s Maffei nd Broedersen.8. Accordingo the old canon aw, anystatutes llowingnterest ere nti-canonical. The Council fVienne 1311-1312) xplicitly eclares hem obe incontraventionfdivine nd humanaw andorders herepeal f hose n operation:Decretales,. Ex gravi,n Clement.,ib. 5, title , can. 1, ?1.9. CountMonaldoLeopardi 1776-1847), a giustizia ei contrattil'usura(Modena,1834); Anonymous,nalisi ragionata critica ei libri re u le usuredell'abbate arcoMastrofiniata n luceda unamicodellaveritdNaples, 1835).CountLeopardiwas the father f thefamous oet,GiacomoLeopardi:his reac-tionarydeas werenot imited o the usury uestion.1. "Usure,"Dictionnairee Thgologieatholique, V, cols. 2379 f. Thenew canon aw, promulgatedy BenedictXV in 1917, art. 1543, admitsthevalidity fthe egaltitle non stper e llicitume ucro egalipacisci, isi constetipsumesse mmoderatum),lthough t stillupholds he principlehat a loan isper e a gratuitousontract.Further etails bout the decisions f theRomancongregationsn 1830 nd atermaybe foundn HenryC. Lea, "The EcclesiasticalTreatmentf Usury,"Yale Review,I (1893-94),379-85 (republishedn MinorHistoricalWritingsnd Other ssays, Philadelphia, 942,pp. 129-51). Theinterpretationsf this author re generallynfavorableo the Church, uthisfactualnformationgreeswith heDictionnairee Thgologieatholique.

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SCHOLASTIC ECONOMICS 177scholasticconomics,hich ad emphasizedsury omuch, eceivedits deathblow.

IV. SCHOLASTICISMAND MERCANTILISM:A CONTRASTThe differencesetweenmercantilismnd scholasticeconomicsare striking nd profound. Yet, I do not know that a comparisonhas ever been attempted,lthough clear perception fthe contrastshas its importance oran understandingf the development f eco-nomic hought.There reevenhistorians ho professo find he"prehistory" f economics mong thevagaries of themercantilisticpamphleteers,huscompletelygnoringhe contributionsf theDoctors.2Unlikemercantilism,cholasticeconomics njoyedthe unques-tioned uperiorityfbeing an integral artofa coherent hilosophi-cal system. Althougheconomicswas not yet acknowledged s anindependent discipline, t formeda consistent body of doctrineaccordingowhich conomicelationsughto beruled y he awsofdistributivendcommutativeustice. In contrast, ercantilismasnevermore han conglomeratefunco-ordinatedrescriptionsywhichhe uthorsf hemercantilisticractsoughto nfluenceco-nomic olicy, suallyna sensefavorableo their rivatenterests.3TheDoctors, s thisname ndicates, ere ll universityradu-ates,trainedntheologyr ncanon nd civil aw (doctortriusquejuris). Most of themwere clerics, hough there are some notableexceptionsamong the jurists, especially among the civilians,forinstance,Messer Lorenzo di AntonioRidolfi,who was a layman,adiplomat nd a lecturer t theFlorentine thenaeum.4The mercan-tilists,on the contrary,were with fewexceptions elf-trainedmer-chants,withsome literary alents,but withoutuniversity egrees.Essentially, heywereempiricistswho,forbetterorforworse,werenot encumberedby scholastictraditions. In this way theymadetheirmajor contributiony developing hebalance-of-tradeheory,whereastheDoctorswereunable to cut themselves oose from heirtraditional pproachto theforeignxchangeproblem.

As a rule,themercantilist ritingswere brief ractson specificand controversialssues, which contrastmarkedlywiththe weightyand oftenpedantictreatisesof the Doctors. Whereasthe mercan-2. For nstance, dwardHeimann, istory fEconomic octrines,p.22-47.3. A. V. Judges, The Idea of Mercantile tate," Transactionsf heRoyalHistorical ociety,thSeries,XXI (1939), 50.4. For his biography,eeVespasiano a Bisticci,Vitedi uominillustri elsecoloXV (Florence, 938),pp. 401-5.



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178 QUARTERLY JOURNAL OF ECONOMICStilistpamphlets arely efero sources rprovidemarginalnotes, hescholastictreatisesliterallybristlewith referencesn support ofnearlyeverystatement, ven the most commonplace. This some-times annoyingdisplay of erudition, irst ntroducedby the post-glossators, eceivedfurtherncouragementrom hehumanists,whodeveloped the habit of invoking he authority f the Ancientsforeverything.By theveryfactthat theDoctorsweremoralists,heirmainpre-occupationwaswithsocial usticeand generalwelfare, utnaturallywiththese deals as theywere conceived n theMiddle Agesand thesixteenth nd seventeenth enturies. The mercantilists,oo, pro-fessed ofurtherhe cause ofthecommonweal;however, heirdecla-rations n thisrespect houldnotalwaysbe taken t their acevalue.Alltoooften hey erve s a screen orprivate nterests.Most oftheauthorsof mercantilistractshad an ax to grind. This is especiallytrueofthe earlymercantilists.G6rard de Malynes (fl.1586-1641)was a perennial ffice-seekerhoadvocatedexchangecontrol n thehope that he himselfwouldbe appointedthe controller.Misselden(fl. 1608-1654) and JohnWheeler fl. 1601-1608) were spokesmenfor he MerchantAdventurers;nd ThomasMun (1571-1641)wrotehis tracts n defenseofthe East India Company. As forGresham(1519-1579),he was a shrewd nd nonetoo scrupulousmanipulatorof the moneymarket,whose recommendations,lthoughadvanta-geous to the Queen,wereapt to have unfavorable epercussionsnEnglishtrade and onthe volumeofemployment.The latermercan-tilistswere essprejudiced, uttheirviewswerestillwarpedbytheirnarrownationalism. Most of them rallied to the defenseof thecolonialsystem nd sponsored ggressivemeasuresto combator toexcludeforeign ompetition,n attitudewhich s alien to the spiritofscholasticism.Did notSt. Thomas justifynternationalradebypointing ut thefactthatno nation s self-sufficient?'As we have seen, the casuistsofthe seventeenth enturywereeitherunwilling r unable to rejuvenatetheirmethods. They con-tinued in the old ruts and made no efforto incorporatenew dis-coveries, uch as the balance-of-tradeheory,nto theirtraditionaldoctrines. The conservatismof the late scholasticwritersthusbecamean impediment o further rogress, nd it is fortunatehatthe mercantilists isplayedmore nitiative nd did not hesitatetoblaze new trails. True, theirmethodswerenot always sound,nor

5. Amintoreanfani, toria elle ottrineconomiche:l volontarismo3ded.;Milan,1942),p. 112. The references to De regiminerincipum,ook 2, chap.3.



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SCHOLASTIC ECONOMICS 179always successful,but they opened up new avenues for furtherresearch. The controversyf the earlymercantilistsbout exchangecontrol ed to a premature roposalfor he creation f a stabilizationfund nd eventually ulminatedn the formulation yThomasMunof the balance-of-tradeheory. The mercantilists lso made thefirst lumsy ttempts o use statisticaldata, and Sir WilliamPetty(1623-1687) evenmadestatistics he basis ofhis PoliticalArithmetick.Othersponderedoverbanking schemes;and the studiesof CharlesDavenant (1656-1714) and Gregory ing (1648-1712) on thebehav-ior of grainpricesputthemon the trackof the elasticity fdemand.7The seventeenth enturywas the age ofprojectors. Nearlyalways,the aim was to influence ublic policy,whereas he scholasticwriterswere content to set up ethical standards, but lefttheirpracticalrealization o the oftennefficientovernmentuthorities.The scholasticwriters egarded rade as an occupationwhich,althoughnot evil in itself, ndangered he salvation of the soul, asthe merchants lmost unavoidably succumbedto the temptationsof usury, cheating, nd unlawfulgain: et de hocrarissime vaduntmercatores,s St. Bonaventure 1221-1275), the Seraphic Doctor,testifies.8 n thisopinion, heotherDoctorsconcur:without xcep-tion, heymuchprefergricultureo trade. Themercantilist riters,of course,take exactlythe opposite point of view.9 In theireyestrade s thenoblestofall professions.' Both agriculture nd industrydependon trade to providea marketfortheirproducts nd to giveemploymento the "poor."2 The merchant, arfrom eingregarded6. de Roover,Greshamn Foreign xchange, p. 226-31, 50-65.7. I take advantage f thisopportunityo call the attention f theecono-mists o an article y Luigi Einaudi, "La paternity ella leggedetta di King,"Rivista i storia conomica, III (1943), 33-38. The author ttributes o bothDavenant and King the discovery f the aw stating hatgrain rices arymorethanproportionatelyo the deviations f the harvest rom he normal.8. Decretum ratiani: anonQuoniam oncognovi,ist. LXXXVIII, canon12; and canonQualitas ucri, ist. V, "de paenitentia," anon2; quiadifficilestinter mentis endentisqueommerciumon ntervenireeccatum.Cf. Schreiber,op. cit., . 129.9. Jelle C. Riemersma, Usury Restrictionsn a Mercantile conomy,"CanadianJournal fEconomicsnd Political cience, VIII (1952),22.1. See the encomium f trade by Thomas Mun, England'sTreasure yForraignTrade London,1664), chap. 21. Cf. Eli F. Heckscher,MercantilismII, 281.2. WilliamD. Grampp, The LiberalElements n EnglishMercantilism,"thisJournal, XVI (1952),469. These deas musthave been currentmong hemerchants n the continents wellas in England, incewe find hem lso inLodovico Guicciardini's amous escriptionf Antwerp, irst ublished n 1567:Description e tous es Pays-Bas, rans. rangois e BelleforestAntwerp, 582),p. 182; republishedn Tudor conomic ocuments,ds. R. H. Tawney ndEileenPower, II, 161.



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180 QUARTERLY JOURNAL OF ECONOMICSwithdistrust, s extolled s thebenefactor fhumanity nd the prin-cipalpillaroftheState. This iswhat one might xpect, incemercan-tilismwastheeconomic ystem evelopedby,andfor, hemerchants.In contrast o scholasticeconomics,mercantilism as amoral.The later mercantilistswere interested n a large population andfullemployment nlybecause they thought uch conditionswouldstimulate rade nd increase heeconomic ower fthe state.3 Usurywas no longerconsidereda voraciousmonster: Sir Josiah Child(1630-1699), SirThomas Culpeperthe Elder,and others omplainedonlythatthe nterest ate, beinghigher nEngland than nHolland,favored he competition f the Dutch.4 Trade has no soul and theindividualdid not count: whyshould themercantilists e disturbedbymoral ssues?One ofthemoststrikingharacteristics f scholastic conomicswas universalism: egardless f origin nd nationality, he Doctorsare in fundamentalgreement n method nd principles. Althoughtheremay be, sometimes, harpdifferencesn points of detail or ofpracticalapplication, ll their reatisesfollowmore or less the samepatterneasily recognizableby anyone acquainted with scholasticliterature. n themercantilistamp,on thecontrary,uchuniformityindoctrine r methoddoes notexist:neither etweennational choolsnorbetween ndividualwriters.Among the mercantilists, everyone is his own economist,"according o thephrase o aptlycoinedby Professor . A. J.Johnson.No oneconsiders imself oundbyprecedent, ndeach author ollowshis owninspiration n selecting he appropriatemethodfordealingwithhis chosentopic.Notwithstandinghe greatprestige fEli F. Heckscher, dis-agree with his statement hat mercantilismtrove towardunity.5As a matter f fact,non-scholasticconomics n the seventeenthndeighteenthenturies aried greatly rom ountry o country. In myopinion, hename"mercantilism"s appropriate nlyforBritish co-nomicsduring hatperiod. In Germany, ne should speak ofcam-eralism. Oneof ts eading xponents, ohannJoachim echer 1635-

3. E. A. J.Johnson,redecessorsf AdamSmith, p. 247-52; Heckscher,Mercantilism,I, 159; PhilipW. Buck, ThePolitics fMercantilism,p. 44-48,65-66,89-90.4. Heckscher, ercantilism,I, 286-89.5. Heckscher, imself,n response o criticism f his book,was forced oconcede hatmercantilismailed s a unifyingystem:Mercantilism,"conomicHistory eview, II (1936),48. Cf. HerbertHeaton,"Heckscher nMercantil-ism,"Journal fPolitical conomy, LV (1937),374; J.F. Rees,"Mercantilism,"History, ewSeries,XXIV (1939-1940), 30.



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182 QUARTERLY JOURNAL OF ECONOMICSso also in Italy the scholastic raditionswereparticularly trong,ndpersistedwell into the eighteenthentury longwithothercurrentsof thought riginatingn the merchantmanuals ofthe MiddleAges.3In 1613,a Neapolitan writer, r. Antonio erra, n fighting schemeto regulateforeign xchange, ormulatedndependentlyhe balance-of-trade heory eveloped ontemporaneouslyy theEnglishmercan-tilists.4 His proposalswere dismissed, nd his bookwas ignored ormore thana century ntilabb6 FerdinandoGalianipraised t as anoutstanding erformance.The witty bb6 expresses is surprise hata book likeSerra's was conceived in an age of gnorance bout eco-nomicmatters," ut he complains hat the work s "tedious"readingbecause of ts obscure tyle, ts poororganization,nd its "divisionsand subdivisions"reminiscent f scholastic literature.' In otherwords, heabbe is a typicalexampleof the eighteenth-centuryointofview. Another nterestingact s that Galiani considers heworkofSerrato be scholastic,whereasmost modern uthorshave classedit as a mercantilistamphlet.6The trouble s thatthe word "mercantilism" oes not standfora clear concept,but lends itself o confusion. The great specialistHeckscher,himself,has to admit that "mercantilisms simplyaconvenient ermforsummarizing phase of economic policy andmostoftheSpanish conomicwriters ere cclesiastics ithno intimate nowl-edgeofbusiness r financepp.229-30),Professoramilton allsthem mercan-tilists." Sanchode Moncada, one of the so-called panishmercantilists, asprofessorf heologynthe UniversityfToledo, s Hamilton imself oints ut(American reasure, . 294). Other uthors,ncluding ndrds illegasCastillo,Ram6nCarande,BernardW. Dempsey,MarjorieGrice-Hutchinson,nd Jos6Larraz,do notagreewithHamilton's lassification. nlyGer6nimoe Uzt~iriz(1670-1732), late writernd statesman,eems o have come tronglynder heinfluencefmercantilisthought.Cf.Ram6nCarande,CarlosV y stsBanquteros,la vida economicde Espafa en unafasede si hegemonia,516-1556 Madrid,1943),p. 89.3. Heckscher Mercantilism,I, 263) implicitly dmits that he is unac-quaintedwith talianeconomiciterature. hefamousract fBernardo avan-zati (1529-1606),Notiziadei cambi,writtenn 1581,was certainlyasedonmer-chantmanuals, s appearsclearfrom wo manuscriptsn theState ArchivesfPisa: PondoAlleati,Nos. 17 and 69. I owe this nformationo the kindness fProfessor ederigoMelis of theUniversityfPisa.

4. Breve rattatcelle ausechepossono ar abbondarei regni 'oro argentodove on onominiereon pplicazionel Regno i Napoli nEconomistielcinquee seicento,d. AugustoGraziani Bari, 1913),141-233. Selections rom erra'streatise,nEnglish ranslation,re foundnMonroe, p. cit., p. 143-67.5. FerdinandoGaliani,DellamonetaBari,1915),p. 344.6. Monroe, p. cit., . 144; Cossa, op. cit., . 178; Fanfani, toria,tvolonta-rismo, . 171; LewisH. Haney,History fEconomic hought3ded.), pp. 112-13;JohnM. Ferguson,andmarks fEconomic hought,p. 36-37.



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SCHOLASTIC ECONOMICS 183economic deas."7 It should be added that the termcovers onlythose heterogeneous deas that are non-scholastic n inspiration.

Thereare remnants fscholastic nfluencen many mercantilistwritings, ut surprisinglyhose traces have not been recognized,though hey renot so difficulto spot. The mercantilists,fcourse,wereunableto escapefrom he mpactofseveralcenturies fculture.Whetheror not they knew it, they absorbed some of the ideasbequeathed by former enerations.8Gerardde Malynesis the writer n whose worksthe traditionalviewsare the mostperceptible.Whether e shouldbe considered sa mercantilistras a scholasticwriter,s to mymind mootquestion.9In any case,there an be nodoubtthathe forms he inkbetween hetwo schoolsof thought. His insistence n the par as the onlyfairrate of exchange s simply variantofthe just price theory akenover fromDr. Thomas Wilson,himself Doctor still imbuedwithscholastic raditions. According o ProfessorJacobViner,Malyneswas poor nmarket nalysis,' but there an be no question bout hisbeingwellread and wellacquainted with ancient and scholastic it-erature.2 In his Saint George orEngland,a tractagainst usury,hedescribesthe dragon called Foenuspoliticum s havingtwo wings,usurapalliataandusuraexplicate, nd a tail,"inconstant ambium."sThis allegory s obviously sheer and unadulterated cholasticism.Malynes has also receivedcreditfordistinguishingetweenchangesin theprice evel due to monetary actors nd changes n the priceofparticular ommodities ue to theoperation fthe law ofsupplyand demand. I strongly uspectthat this dea didnot originatewithhim but that he took t from continental reatise, orhe was bynomeansan original hinker nd was addictedto plagiarism.4

7. "Mercantilism,"conomic istory eview, II (1936-37), 4.8. HeckscherMercantilism,I, 277) states: Hereonemayperceive tend-ency owards conomiciberty hatwas never ntirely roken ff nd thereforeconnectedmedieval nd laizzez-fairedeals."9. de Roover,Greshamn Foreign xchange,p. 285 f.1. Studies n theTheory fInternationalrade New York,1937), p. 76.2. Helen E. Sandison, An ElizabethanEconomist'sMethod of LiteraryComposition," untingtonibraryQuarterly,I (1942-43),205-11. ProfessorSandison showsthatMalynes certainly borrowed" rom ir ThomasMore'sUtopia. I may add thathe also was acquaintedwith he works fJeanBodin,Lodovico Guicciardini, r. Thomas Wilson,Aristotle, nd most probably,Leonardus essius.3. SaintGeorgeor ngland llegoricallyescribedLondon, 601);"Forewordto the Reader." On p. 61, Malynesmentions he extrinsic itles,damnumemergensnd lucrumessans.4. In the sixteenthentury,most of the scholasticwritersccepted thequantity heory fmoney nd statedthat prices "generally" o up or down



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184 QUARTERLY JOURNAL OF ECONOMICSIn a recent rticle,the mercantilists ave beenpraisedforthe"liberalism" of theirconcepts.5 Contrary o the conclusions f the

author, t appears, however, hat those so-called"liberalelements"are rooted in the doctrinesof the medieval Schoolmen.6 For onething, he Doctors were uncompromisingn their condemnation fmonopoly or hereasonthatthemonopolist xploits hepublicandmakes an illicit gain by raising the price of his articles above thecompetitive evel. For example,CardinalCajetan, commentingnthe Summaof ThomasAquinas states that monopoly ffends reedomby compelling he public to pay a price higherthan the one thatwould prevail in the market, f there were no such monopoly sihuiusmodimonopolium on esset).7 The traditionalfeeling gainstmonopolywas so strongthat no mercantilistwriterdared openlydefypublic opinion, ven whenhis purposewas to justify hemonopo-listic practicesof thisor that trading ompany.8 In the parlanceofthe mercantilists,free rade,"as I have pointedoutin thisJournal,meant freedom rom estraints f any sort n internal s well as inforeign rade. Consequently, t corresponded o theFrenchexpres-sion ibertyucommercend not to libre change.9 n the seventeenthcentury, rotectionn the modern ensewas not yet born;the strugglewas stilla medieval struggle or the controlof the carrying rade.'In dealingwith the history f economic hought, t is not enoughtoknow the writings f the economists; ne must also know somethingwith he abundance r scarcity f money. Such a statement ad evenbecomecommonplace.5. Grampp, p. cit., p. 465-501.

6. Ibid., pp. 500 f. So far as I know, he Schoolmen ave never tated"thatfreendividual ehaviorwas nimical o thewelfare f society." Heckscher(Mercantilism,I, 277) asserts he contrary nd rightly tates: "that even themedieval radition as sympathetico a certain ort f freedom.The medievalinfluence as thusnotwithoutmportanceo thenotion f conomicibertyndermercantilism."As late as the seventeenthentury,he Anglican nd Puritandivines continued o propound cholasticdoctrine n just price,monopoly,and price discrimination. ee the characteristicassages of RichardBaxter(1615-1691), popular reacher, hich re quotedby H. M. Robertson, spectsof theRise ofEconomicndividualism: Criticismf Max Weber nd his School(Cambridge, 935),p. 17.7. Text quoted by Fanfani,Origini ello pirito apitalistico,. 123. Cf.JosephHOfner,WirtschaftsethikndMonopole mfinfzehntennd sechzehntenJahrhundertJena, 941),p. 107.8. deRoover,Greshamn Foreign xchange, . 284. Such was certainlyhepurposeof JohnWheeler, dward Misselden, homasMun, Sir JosiahChild,and CharlesDavenant.9. When French uthors f the periodmean libre hange,theyuse theexpression:ibertyucommercentrees nations.1. de Roover,Greshamn Foreign xchange,p. 282 f.



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SCHOLASTIC ECONOMICS 185about the institutional rameworknd the social environmentf theperiod.

Certainly, heEnglish "mercantilists id not believe n an econ-omywholly r mainlydirected y the State,"2but they wanted thestate to pursuea policy favorable o thetrading nterests nd theytendedto defend heexclusiveprivileges f chartered ompanies ndcorporations.3Owing o the persistentnfluencef scholastic deals,themercantilistsaidlip service o the goddess f "free rade,"thoughthe sincerity f theirdevotion s verymuch open to question, nas-muchas theirpretenses onflictwiththeir otheraims. But then,mercantilismwas not a logical system. It may even plausiblybeargued that, unlikescholasticism, hemuch vauntedmercantile ys-tem was nota system t all.

V. CONCLUSIONSThe shortcomingsf scholasticeconomics and no effort asbeen made to concealthem shouldnot blind us to the greatnessofthe achievement. The Doctors correctly iagnosedthe economicproblem s one ofscarcity. In their pinion, conomicswas a branchof ethicswhichdeterminedhe rulesof ustice that oughtto presideover the distributionnd the exchange f scarce goods. It is obviousthat there would be no need for distribution r exchange, f goodscould be obtainedwithout ffortn unlimited uantities.The greatdifference etween cholastic nd contemporaryco-nomics s one of scope and methodology: he Doctors approachedeconomicsfrom legal point of view. They attached an excessiveimportance to formalism,o that the study of economicsnearlyreduced tself o an investigation nto the form nd natureof con-tracts. Because of theirpreoccupationwithethics, he Doctors werealso more nterestedn what oughtto be than n what actuallywas.In the matter fusury, hey made thefatal mistakeofallowing hissubordinate uestion o overshadow ll otherproblems. Besides,thesophisticationfthe ater casuists nvolved hemmoreandmore namaze of contradictions, hich, ever since the eighteenth entury,have prejudicedeconomists gainst scholasticdoctrines. The moreconcessions he casuistsmade, the morethey undermined heirownposition. They wereunwilling o facethe fact that theirdistinction

2. Grampp, p. cit., . 495.3. In order o enlist he upportf hegovernment,ercantilistritersndprojectors everfailed o stress he benefits hichwould accrueto the RoyalTreasury,f their chemeswerecarried ut (Heaton,"Heckscher n Mercantil-ism,"op. cit., . 376).



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186 QUARTERLY JOURNAL OF ECONOMICSbetweenusurious nd nonusurious ontractswas based onmere egaltechnicalities.4After ll,was it logicalto allow a chargeforthe useofmoney n one case and to prohibitt in another?5The Doctors,especially hemembers ftheschoolofSalamanca,made oneoftheirmaincontributionsndeveloping theory fvalue,based on utilityand scarcity,which is morein line withmodernthinking han that of Adam Smith. Because of his influencendprestige, e created century fconfusionn thistopicby throwingout utility nd by becoming ntangled n the antithesis fvalue inuse and value in exchange. The Doctorswerealso rightn stressingfrom hebeginninghe principle fmutualadvantage n anybargainorvoluntary xchange.'In the absenceof fraudor collusion, hemarketprice was sup-posedtobe just, buttheDoctorsneverquestioned heright fpublicauthoritieso interfere,henever, ecauseof famine rother ircum-stances, eitherbuyersor sellerswould be seriouslyharmedby thefree operationof the law of supplyand demand. Perhaps in thenineteenth entury, conomistsmighthave regardedthe scholasticposition s erroneous, ut todaywe operate, n fact,on a just-pricebasis, since the government oes not hesitateto regulateprices ntimes of national emergency. While the Doctors may have beencorrect n their nalysis, heyhad the faultofmany dealistsofover-looking ntirely racticaldifficulties:hey ssumedthat t sufficedoset a priceby decree n order omake it effective.In accordancewith theteachings ftheDoctors,monopolywasalmost everywhereonsidered criminal ffense. Incidentally, heDoctorsrarelymention heguilds nd thenonlyto reprove hemfortheirmonopolisticractices.7I do notfind vidence n their reatisesthat theyfavored he guildsystem,which s so oftenpictured s anideal organization orChristian ocietyor is recommendeds a pan-acea againstthe evilsof modernndustrialism.8

4. Robertson,p. cit., . 118:"In practice, alvin'sposition that ll usurieswerenot necessarilyo be condemned) ad beenreached y Catholic eachers.The differenceas mainlyone of expression.Amongst he Catholicsmoredepended pon theformalitiesf contracts."5. See R. H. Harrod's emarksn a review fJohn . Kelly, Aquinas ndModernPractices f nterest aking,"Economic ournal,VI (1946),314.6. Grampp op. cit.,p. 466) credits he mercantilists ith heformulationofthisprinciple,lthought is clearly tatedby ThomasAquinas,nhis Summatheologica,I, ii, qu. 77, art. 1, corpus. Cf. Monroe, p. cit., . 54. John uridangives n evenbetter nalysis hanAquinas Schreiber,p. cit., . 183).7. H6ffner, irtschaftsethikndMonopole, p. 82, 92-94.8. This sthepoint fview, or xample, f headvocates fguild ocialism,especiallyhe earlier dherentsf this chool. Cf.Arthur.Penty,Old Worlds



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SCHOLASTIC ECONOMICS 187Among other contributions f the Doctors, one shouldnot for-get to mentiontheir acceptance, by the sixteenth entury, f the

quantity theoryofmoneyand theirspeculationson the lawfulnessofbanking nd dealings n foreign xchange. The latterdiscussion,starting s far back as the thirteenth entury, aved theway to thebalance-of-trade heory,developed by the English mercantilistsnthe Tudor and Stuartperiod. Unfortunately,he ate casuistsneverpaid any attention o this discovery nd even allowedit to be usedagainst thembytheir pponents.One should not mistakenly ssume that scholasticeconomicsexertedno influence n business morality. The Church soughttoenforce ts code of social ethics n two ways: in foro xterno,hat is,through he courts,ecclesiasticaland secular,and in foro nterno,that is, throughthe confessional. In the Middle Ages, all overwesternEurope, usurers were constantlybroughtto court. It istruethat the historian tops at thethreshold f theconfessional, utthe numerousmedieval wills providing orrestitutionfusury sug-gest that confessionwas far frombeing an ineffectivemeans ofenforcement.9This is not the place to enter ntoa discussion ftheMax Webertheory bout the r6leofreligion n the rise of capitalism. I questionit, because thewritings fthe Doctors seemto showthat the medievalChurchneither avorednorhindered hedevelopment fcapitalism.Like technologicalnd scientific rogress, apitalism rew utside heChurch. It does not follow,however, hat scholasticdoctrines adno influence n the course of economic development. Quite thecontrary. Recent research n economichistoryhas established hefact that the usuryprohibition rofoundly ffectedhedevelopmentof banking. Since the taking of interestwas forbidden, he dis-countingof commercial aper was also ruled out, but the bankerscleverly hifted o exchangedealings s the basis of their perations.This shift hanged the entire tructure f the continental uropeanbanking ystemup to the time of the FrenchRevolution.'To consider cholastic conomics s medieval doctrines simplyan error, nd economists ave bypasseda current fthoughtwhichfor New,a Studyof thePost-Industrialtate,pp. 44-49; Ralph AdamsCram,WalledTowns p. 46, 80-82; G. D. H. Cole,"GuildSocialism," heEncyclopaediaofthe ocial Sciences, II, 202-4.9. BenjaminN. Nelson,"The Usurer nd the MerchantPrince: talianBusinessmennd the Ecclesiastical aw of Restitution,100-1550," upplementto TheJournal fEconomic istory, II (1947), 104-22.1. de Roover, 'evolution,p. 144-45.



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188 QUARTERLY JOURNAL OF ECONOMICSruns parallel with mercantilismnd reached out into the eighteenthcentury,connecting he 6conomistesnd even Adam Smith withThomas Aquinas and the medievalSchoolmen.2 Traces of scholasticinfluence till permeate eighteenth entury conomic thinking ndsometimes ppear in unexpectedplaces, such as theEncyclopediefDiderot and d'Alembert. The Encyclopddie'sefinitionfpricediffersin no way from hat given n scholastic reatises, nd the same appliesto the treatment f monopoly nd dry exchange.'In the case of Adam Smith,the ascendance which inkshimtoscholasticism asses through is teacher, rancis Hutcheson, amuelPufendorf,nd Hugo Grotius.4 Smith's ibrary ontainedcopies ofbothGrotius nd Pufendorf.5Moreover, here s evidence hatAdamSmithread Grotius at the age of fifteen hen he was a studentatGlasgow College. At that time,his teacherwas usingas textbooktranslation f Pufendorf's e officio ominis et Givisby GershomCarmichael d. 1729), Hutcheson'spredecessor n thechairofMoralPhilosophy.6 In his lectures n politicaleconomy, s already stated,Hutchesondealt withthe subject n scholastic ashion s a branchofnatural jurisprudence, articularly s "a discussionof contracts."7When AdamSmith,himself, ucceeded o the chairof Moral Philoso-phy,he modified his outlineby transferringconomics o the fourthpartof"his course of ectures"devoted to mattersnot pertaining ojustice, but to expediency.8 This decisiondefinitelyonstitutedbreakwiththe scholastic tradition. The outlineof the course inMoral Philosophy, s taught by Francis Hutchesonand later byAdam Smithhimself, learly hows that the curriculumfGlasgowCollege, n the eighteenth entury, everpaid anyattention o mer-2. Professor abel Magee, my formerolleague t Wells College, ellsmethat Seligmanwas an exception. According o herdetailednotesonhiscourseat ColumbiaUniversityn the history f economic hought, e dealt withmostofthe writersmentionedn this rticle nd did not considercholastic conomicsas a medieval conomic octrine. I avail myself f thisopportunityo thankDr. Magee and another ormerolleague, rofessor ean . Davis, forreadingdraft fthis rticle nd making elpful uggestions.3. Accordingo theEncyclopedie,he priceofcommoditiess set either yordinancerby common stimation:hefirsts called he egalprice prixegitime)and thesecond, he current rice prix courant). The scholastic rigin f thisdistinctions beyond uestion.4. Grice-Hutchinson,he School fSalamanca, p. 64-69,76. Cf. WilliamRobert cott,Adam mith s Studentnd ProfessorGlasgow, 937).5. JamesBonar,A Catalogue f he ibrary fAdamSmith 2d ed.), pp. 78,151. 6. Scott, p. cit., p. 34, 112.7. JohnRae, Life ofAdamSmith, . 14.8. Ibid.,pp. 54 f.



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SCHOLASTIC ECONOMICS 189cantilist hought, ut always provided or ome teaching feconomicprinciplesbased on ethics and law, inheritedfrom the medievaluniversity. n the Wealth fNations,Adam Smith, t is true,devotesseveral chapters o mercantilism ut only to denounce t as a perni-cious and "sophistical"system.Two eighteenth entury conomists, bb6 Ferdinando Galiani(1728-87) and abb6 Etienne Bonnot de Condillac (1715-80), havebeenhailed by some historians s the first o anticipate he modernmarginalutility heoryof value by statingthat value rests on thecombination f two elements:utilityand scarcity.9 The questionariseswhether his dea originateswiththe two abb6s or whetherwhat smore ikely- they ook tfrom he Doctors,possiblybywayofthe late casuists and the schoolof Salamanca, as MarjorieGrice-Hutchinson seems to think.' In my opinion, she is undoubtedlyright, ince t is highly mprobable hat culturedmen n holyorderswould be unacquaintedwith the extensive iterature nmoraltheol-ogy. As far s Galiani is concerned,cholastic nfluences noticeablein many passages of his essay on money, specially n his treatmentofusury nd cambio.2 Furthermore,he chapteronvalue containsquotationfromDiego Covarrubiasy Leyva,oneofthe eadingrepre-sentativesof the school of Salamanca.3 Consequently,Galiani cer-tainlyknew his work, nd hence therewas no breach of continuity.As this study shows, moderneconomics owes the Schoolmenand their uccessors greater ebtthan s commonly cknowledged.It also illustrates he merits nd thedefects f the legal approachtoeconomics. What reallycaused thedownfall f scholastic conomicswas therefusal fthe late casuiststo revise and to modernize heirmethods. Perhaps their whole systemwas in need of a completeoverhauling. Nevertheless, t containedmuch that was worthpre-9. Galiani, p. cit., ook , chap.2, pp. 25-45; and Condillac, p. cit.,Vol. ,chaps. 1 and 2, pp. 248-57. In a footnote, he editor, ugeneDaire,blamesCondillac ornot followingn thefootstepsfQuesnay nd AdamSmith ndnotadopting heir istinctionetween alue n use and value n exchange1. Op. cit., p. 63-64,76.2. Op. cit.,Book 5, chaps. 1 and4, pp. 289-96,303-7. Galiani'sdefinitionof usury, s any gainabove the principalccruing rom mutuum,s stillpurelyscholastic.3. Op. cit.,Book I, chap. 2, p. 26. The most recent nd muchthebestbiographicaltudy n abbeGaliani s that of President uigi Einaudi,"Galianieconomists,"aggibibliograficistoricintorno lle dottrineconomicheRome,1953), 69-305. This studywas firstublishedn German nder he itle Galianials Nationalkkonom,"chweizerischeeitschrifturVolkswirtschaftndStatistik,LXXXI (1945), No. 1. An English ersion f the first art of Einaudi'sstudyis available n HenryWilliam piegel ed.), TheDevelopmentfEconomic hought(New York,1952),pp. 62-82.



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190 QUARTERLY JOURNAL OF ECONOMICSserving nd whichwas preservedn actual fact. Valuable ideas maylie buriedfor a time but they eventuallyspringup. Like othersciences,economicsgrowsslowly by accretion. Despite many cur-rentsand cross currents, ontinuity s perhaps themost impressivephenomenonn the history f economicdoctrines.

RAYMOND DE ROOVER.THE GRADUATE SCHOOLBOSTON COLLEGE

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Scholastic Economics