1. The southern route was almost entirely on water. Ships laden with goods from India and China sailed across the Arabian Sea and northward up the Red Sea. The goods were then hauled overland to the Nile River and transported to the Mediterranean




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In the last chapter, we discussed specifically the religious life of people in the Middle Ages. In this chapter, we will discuss the economic, social, and political developments of the Middle Ages, which reveal the beginnings of modern Western society. All of these aspects are intertwined. During the late medieval period (1200-1500), Europe experienced significant changes. Trade was pursued with renewed vigor, towns grew in size and importance, and a new social class emerged. Contact with other cultures sparked interest in learning and the arts, and national states began to appear. At the same time, the feudal and manorial systems weakened, and the church, once the dominant force in Europe, declined in strength and influence.

I. Revival of Trade

During the early Middle Ages, trade activity had diminished in Europe. Money was in short supply. Travel was often treacherous, as roads were poor, and robbers and pirates often threatened merchants on the trade routes. Towns, which were once the heart of economic activity, declined in size. The manors became the new economic centers of medieval Europe. Unlike towns and cit­ies, manors did not depend upon trade but were virtually self-sufficient. The few items that could not be made or grown on a particular manor could be obtained by barter—exchanging goods for goods. For the most part, trade remained localized and relatively insignificant.

Trade Routes

The reopening of trade routes between western Europe and the East was a ma­jor factor in the revival of European commerce. During the early Middle Ages, Byzantine and Muslim merchants had dominated trade in the Mediterranean region. Later, however, enterprising Italian merchants, with their large fleets, began to seize trade rights in the Near East. Soon Italian cities such as Venice, Pisa, and Genoa gained a virtual monopoly on Mediterranean trade.

European commerce expanded as the Italian merchants became the middle­men in trade between Europe and the Orient. Once goods from the Far East reached the Mediterranean, Italian merchants transported them to Europe, where they were distributed to European markets. Traders who brought goods from the Orient reached the Mediterranean by three principal routes:

1. The southern route was almost entirely on water. Ships laden with goods from India and China sailed across the Arabian Sea and northward up the Red Sea. The goods were then hauled overland to the Nile River and transported to the Mediterranean.

2. The central route combined land and sea travel. Ships from the Far East carried goods to the Persian Gulf, where caravans trans­ported the merchandise to Baghdad or Damascus. Other traders then brought them to port cities along the Mediterranean and Black seas.

3. The northern route, known as the "Silk Road," was an overland route across central Asia. It connected Beijing and Constantinople.

Italy controlled Mediterranean trade, but Flanders was the marketplace of northern Europe. The region of Flanders (which included parts of present-day Belgium, France, and Holland) lay at the crossroads of northern European trade routes. The Flemish, who were makers of fine cloth, had easy access to the markets of Europe.

The Great Hall of Study at the University of Bologna

The Reshaping of Medieval Europe

Medieval Trade Routes

Major Trade Routes

Hanseatic League Trade Routes

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Markets and Fairs

As trade activity increased, so did the need for places where merchants could meet and exchange their goods. On the local level, markets became the primary centers for trade. Once a week traders met along important highways, in church courtyards, or in village squares. The goods sold there benefited both the people on the manor and those in the towns. The market offered incentive for the laboring serfs to produce more, for at the market they could sell their surplus produce. Many saved their money, desiring to buy goods or hoping one day to be able to buy their freedom from the manor. The market also offered craftsmen and merchants an opportunity to peddle their wares. Thus these places of trade met the demands of the local population. Townspeople obtained surplus food from the manors, and the people of the manor acquired articles made and sold by local craftsmen and merchants.

On a larger scale than the markets were the trade fairs, which attracted merchants from all over Europe as well as many foreign countries. These fairs were sometimes great regional or international events. They were held annu­ally and could last from several days to several weeks. Because they were held in nearly every part of Europe, fairs were often scheduled in sequence so that merchants could attend one after the other.

Fairs provided a meeting place for East-West trade. Italian middlemen and foreign merchants from Constantinople, Damascus, and Alexandria brought spices, silks, precious gems, cotton, linen, rugs, and dyes from the East. Peddlers and town merchants bought these "luxury" items and distributed them locally. In return, foreign merchants purchased local products such as wool, grain, timber, and fish.

The most famous and important of the medieval fairs were held in Champagne, a region in northeastern France. This province became an

important trade center for merchants traveling between Flanders and Italy. At almost any time during the year, fairs were being held in the towns of this region, each one lasting about six weeks.

Fairs such as the ones at Champagne were more than just places to exchange goods; they were festive occasions.

The neighboring lords and their families came to see and to buy and to enjoy the diversions of the fair. The monks from the abbey and the secular clergy mingled with the throng. No doubt many an artisan and many a runaway serf from the neighboring manors was drawn hither by the strange sights and sounds and the gay-colored crowd. Mountebanks, jugglers, and musicians of every description vied in their efforts to attract the crowd; men with trained monkeys, dogs, or dancing bears, wrestlers, wandering minstrels singing ancient lays, fakers without number were there to entertain and astonish the populace. There were gathered as in modern fairs the thief, the pick-pocket, the cutpurse, the thug, the prostitute, beggars. Often the sergeants were hard pressed to maintain order in this heterogeneous mob.1

Money and Banking

The barter system in use during the early Middle Ages could not meet the expanding demands of the trade fairs. Therefore, money gained wider use as a means of exchange. This development helped trade and provided a standard of value for the purchase and sale of goods. Feudal lords and commercial towns began minting their own coins. Their values varied greatly, depending upon the amount and purity of the metal contained in them. Certain coins of high quality became widely accepted as mediums of exchange. One, for example, was the florin, a gold coin minted by the city of Florence.

Because most merchants did not know the value of coins minted outside their own region, moneychangers grew in importance at the markets and trade fairs throughout Europe. These men were experienced in judging the approximate value of coins, discovering counterfeit currency, and determin­ing one currency's value in relation to another. Merchants could be assured of the value of a foreign currency that they accepted for their goods. If the mer­chants wanted that currency exchanged into their own, moneychangers were also ready to perform that service—for a fee, of course.

They did more, however, than just evaluate and exchange money for mer­chants. They provided many other services that we commonly associate with modern banks. Since they dealt constantly with money, moneychangers went to great lengths to protect their own funds. Realizing this, other merchants began entrusting their surplus cash to the moneychangers for safekeeping. The moneychangers then became moneylenders. Kings, nobles, and even popes borrowed from them to finance their activities. For example, a king might bor­row money to finance a crusade to the Holy Land. He risked great danger, however, by carrying large sums on his journey. It was much safer and more convenient to obtain a letter of credit in Europe. (Letters of credit were much

Jon Gossaert, Portrait of a Merchant, c. 1530.

Ailsa Mellon Bruce Fund, Image © 2005 Board of Trustees, National Gallery of Art, Washington

The Reshaping of Medieval Europe •

Metsys, Quentin. The Moneylender and His Wife, 75/4.

Inv.: INV1444. Photo Daniel Arnaudet. Louvre, Paris, France

like our modern checks.) Once he reached the Holy Land, he could present the letter of credit to another moneychanger and receive cash in return. It is not surprising to learn that our word bank comes from the Italian banca, which means "bench," referring to the table of a moneychanger.

The Medieval Church and Business Practices

There was little economic freedom in Europe during much of the medieval period. Most people had little opportunity or incentive to improve their way of life. Feudal lords held virtual monopolies over the economic life on the manors. In addition, the teaching of the Roman church discouraged economic activity.

In a day when religion dominated society, it was quite natural for the church to shape the economic ideas of Europe. The church viewed with suspicion those individuals involved in trade. Did not the Bible teach "Lay not up for yourselves treasures upon earth,... for where your treasure is, there will your heart be also" (Matt. 6:19, 21)? Poverty was upheld as a virtue. Since seeking the riches of this world often leads one to greed and the hoarding of wealth, the Roman church sought to place restraints upon business.

Every man had a particular place in society and was expected to work for the common good of society, not just for himself. It was considered selfish and rebellious for one to try to improve his own status in life or to involve himself in trade solely for profit.

Profit resulting from the sale of goods or services was deemed accept­able only if the seller did not take advantage of the buyer. The church ad­vocated a "just price" for goods sold—a price that included the cost of materials, a fair return for labor expended, and a reasonable profit. According to the church it was wrong to sell an item for more than it was worth or to buy it for less than its actual value. If any man received a profit greater than his needs, he was expected to give it to charity.

Furthermore, the medieval church prohibited usury—the practice of charging interest for the use of lent money. Usury was considered a sin. The church assumed that anyone who borrowed money was in great need. Therefore, for some­one to profit from a loan made to a brother in need was definitely wrong. Such a loan should be an act of charity, not a money-making ven­ture. The revival of trade altered this doctrine. Merchants borrowed money not because of pov­erty but for business investment. Soon it became acceptable to charge interest on loans made for investment purposes. Profit made on such loans was considered a fitting reward for the risk taken since loss was an equal possibility.

In spite of the church's teaching, the revival of trade and changes in business methods brought new opportunities and incentives to much of Europe's population. Sound economic principles made Europe prosperous: the dignity of labor, the legitimacy of profit, freedom of exchange, and individual responsibility—not group responsibility—for economic matters. More and more people were gaining financial independence.

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• Chapter 10

Section Quiz

1. Who served as middlemen in trade between Europe and the Orient?

2. What were the primary centers of trade on the local level in Europe? What were the centers of trade for large-scale international trade?

3. Where did we get our word for bank?

4. What is the term for charging interest for the use of lent money? What institution condemned this practice during the Middle Ages?

II. Growth of Towns

Towns, like trade, did not entirely disappear in the West during the Middle Ages. Even so, Europe could boast few cities that could compare in size and population to the many bustling cities of the Roman Empire. Renewed trade, however, stimulated the growth of towns. Towns provided needed markets and were important centers of exchange.

By the eleventh century, active forces at work in Europe began to give shape to the forerunners of the modern city. Better farming methods led to increased agricultural production. Townspeople who wished to devote their full energy to a specific trade or craft could depend upon others to produce surplus food. An increased food supply boosted Europe's population. As Europe's popula­tion grew, so did its towns. Some towns revived within the decayed walls of old Roman cities, while others sprang up at locations important to trade: cross­roads, bridges, fords, river mouths, and harbors. Still others were built near castles, churches, and monasteries.

Bellinzona, Switzerland; located between Northern Italy and the Alps region, this area was a Roman military fortress. In the twelfth century a city began growing around the fortress, and today it is the capital city of the Swiss canton Ticino.

Townsmen Gain Basic Freedoms

Merchants and craftsmen, who lived in the growing urban centers, did not fit into the medieval class structure. They were not lords, vassals, or serfs. And their labor contributed little to the agricultural output of the local manor. Nevertheless, nearly every town was subject to some feudal lord.

Townsmen having common interests soon banded together to gain freedom from feudal interference and to secure local self-government. They achieved this independence in a variety of ways. Some towns bought privileges from feudal lords who were willing to grant certain liberties in exchange for large sums of money. Other lords bestowed these privileges freely, for a thriving town meant greater revenues from sales taxes and tolls (a fee paid for some privileges, such as traveling on a road or crossing a bridge). Nevertheless, there were some lords who did not want to relinquish control at any cost. In such cases towns often revolted and fought for their freedom.

The privileges granted a town by a feudal lord were usually written down in a legal document called a charter. This document outlined the rights and freedoms of the townspeople. The more favorable the charter, the greater the number of people attracted to settle in the town. While liberties varied from town to town, most townsmen shared certain basic freedoms:

1. Free Status.The most important privilege enjoyed by a townsman was that of being a freeman. No matter what his previous status, a man who lived in a town for a year and a day was considered free. A serf, for example, who ran away from his manor and managed to escape capture by living in a town for one year, broke all ties with his manor. An old German proverb said, "Town air makes one free."

2. Exemption from Manorial Obligations.Town charters usually exempted townsmen from laboring for the lord of the manor. The townsmen as a group, not as individuals, owed service to the lord. This service was usually rendered in the form of a cash payment.

3. Town Justice. Townsmen also won the privilege of administering their own justice. Instead of being tried in a feudal court and judged by feudal customs, a townsman was tried in the court of his town and was judged by town people and town customs.
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