Chapter IX: Section 1: The Sale of Goods (2)

[Footnote 2: The argument in favour of what we have called the 'objective' theory of the just price is strengthened by the consideration that goods do not satisfy mere subjective whims, but supply real wants. For example, food supplies a real need of the human being, as also does clothing; in the one case hunger is appeased, and in the other cold is warded off, just as drugs used in medical practice produce real objective effects on the person taking them.]

The theory that the just price was objective seems to be accepted by the majority of the best modern students of the subject. Sir William Ashley says: 'The fundamental difference between the mediæval and modern point of view is... that with us value is something entirely subjective; it is what each individual cares to give for a thing. With Aquinas it was entirely objective; something outside the will of the individual purchaser or seller; something attached to the thing itself, existing whether he liked it or not, and that he ought to recognise.'[1] Palgrave's _Dictionary of Political Economy_, following the authority of Knies, expresses the same opinion: 'Perhaps the contrast between mediæval and modern ideas of value is best expressed by saying that with us value is usually something subjective, consisting of the mental determination of buyer and seller, while to the schoolmen it was in a sense objective, something intrinsically bound up with the commodity itself.'[2] Dr. Ryan agrees with this view: 'The theologians of the sixteenth and seventeenth centuries assumed that the objective price would be fair, since it was determined by the social estimate. In their opinion the social estimate would embody the requirements of objective justice as fully as any device or institution that was practically available. For the condition of the Middle Ages and the centuries immediately following, this reasoning was undoubtedly correct. The agencies which created the social estimate and determined prices--namely the civil law, the guilds, and custom--succeeded fairly in establishing a price that was equitable to all concerned.'[3] Dr. Cleary says: 'True, the _pretium legale_ is regarded as being a just price, but in order that it may be just, it supposes some objective basis--in other words, it rather declares than constitutes the just price.'[4] Haney is also strongly of opinion that the just price was objective. 'Briefly stated, the doctrine was that every commodity had some one true value which was objective and absolute.'[5] The greater number of modern students therefore who have given most care and attention to the question are inclined to the opinion that the just price was not subjective, but objective, and we see no valid reason for disagreeing with this view, which seems to be fully warranted by the original authorities.

[Footnote 1: _Op. cit._, vol. i. pt. i. p. 140.]

[Footnote 2: Art. 'Justum Pretium.']

[Footnote 3: 'The Moral Aspect of Monopoly,' by J.A. Ryan, D.D., _Irish Theological Quarterly_, in. p. 275; and see _Distributive Justice_, pp. 332-4.]

[Footnote 4: _Op. cit._, p. 193.]

[Footnote 5: _History of Economic Thought_, p. 75.]

§7. _The Mediæval Attitude towards Commerce_.

Before passing from the question of price, we must discuss the legitimacy of the various occupations which were concerned with buying and selling. The principal matter which arises for consideration in this regard is the attitude of the mediæval theologians towards commerce. Aquinas discusses the legitimacy of commerce in the same question in which he discusses just price, and indeed the two subjects are closely allied, because the importance of the observance of justice in buying and selling grew urgent as commerce extended and advanced.

In order to understand the disapprobation with which commerce was on the whole regarded in the Middle Ages, it is necessary to appreciate the importance of the Christian teaching on the dignity of labour. The principle that, far from being a degrading or humiliating occupation, as it had been regarded in Greece and Rome, manual labour was, on the contrary, one of the most noble ways of serving God, effected a revolution in the economic sphere analogous to that which the Christian sanctification of marriage effected in the domestic sphere. The Christian teaching on labour was grounded on the Divine precepts contained in both the Old and New Testaments,[1] and upon the example of Christ, who was Himself a working man. The Gospel was preached amongst the poor, and St. Paul continued his humble labours during his apostolate.[2] A life of idleness was considered something to be avoided, instead of something to be desired, as it had been in the ancient civilisations. Gerson says it is against the nature of man to wish to live without labour as usurers do,[3] and Langenstein inveighs against usurers and all who live without work.[4] 'We read in Sebastian Brant that the idlers are the most foolish amongst fools, they are to every people like smoke to the eyes or vinegar to the teeth. Only by labour is God truly praised and honoured; and Trithemius says "Man is born to labour as the bird to fly, and hence it is contrary to the nature of man when he thinks to live without work."'[5] The example of the monasteries, where the performance of all sorts of manual labour was not thought inconsistent with the administration of the sacred offices and the pursuit of the highest intellectual exercises, acted as a powerful assertion to the laity of the dignity of labour in the scheme of things.[6] The value of the monastic example in this respect cannot be too highly estimated. 'When we consider the results of the founding of monasteries,' says Dr. Cunningham, 'we find influences at work that were plainly economic. These communities can be best understood when we think of them as Christian industrial colonies, and remember that they moulded society rather by example than by precept. We are so familiar with the attacks and satires on monastic life that were current at the Reformation period, that it may seem almost a paradox to say that the chief claim of the monks to our gratitude lies in this, that they helped to diffuse a better appreciation of the duty and dignity of labour.'[7]

[Footnote 1: Gen. iii. 19; Ps. cxxvii. 2; 2 Thess. iii. 10. The last-mentioned text is explained, in opposition to certain Socialist interpretations which have been put on it, by Dr. Hogan in the _Irish Ecclesiastical Record_, vol. xxv. p. 45.]

[Footnote 2: Wallon, _op. cit._, vol. iii. p. 401.]

[Footnote 3: _De Cont._, i. 13.]

[Footnote 4: _De Cont._]

[Footnote 5: Janssen, _op. cit._, vol. ii. pp. 93-4.]

[Footnote 6: Levasseur, _Histoire des Classes ouvrières en France_, vol. i. pp. 182 _et seq_.]

[Footnote 7: _Western Civilisation_, vol. ii. p. 35.]

The result of this teaching and example was that, in the Middle Ages, labour had been raised to a position of unquestioned dignity. The economic benefit of this attitude towards labour must be obvious. It made the working classes take a direct pride and interest in their work, which was represented to be a means of sanctification. 'Labour,' according to Dr. Cunningham, 'was said to be pregnant with a double advantage--the privilege of sharing with God in His work of carrying out His purpose, and the opportunity of self-discipline and the helping of one's fellow-men.'[1] 'Industrial work,' says Levasseur, 'in the times of antiquity had always had, in spite of the institutions of certain Emperors, a degrading character, because it had its roots in slavery; after the invasion, the grossness of the barbarians and the levelling of towns did not help to rehabilitate it. It was the Church which, in proclaiming that Christ was the son of a carpenter, and the Apostles were simple workmen, made known to the world that work is honourable as well as necessary. The monks proved this by their example, and thus helped to give to the working classes a certain consideration which ancient society had denied them. Manual labour became a source of sanctification.'[2] The high esteem in which labour was held appears from the whole artistic output of the Middle Ages. 'Many of the simple artists of the time represented the saints holding some instrument of work or engaged in some industrial pursuit; as, for instance, the Blessed Virgin spinning as she sat by the cradle of the divine Infant, and St. Joseph using a saw or carpenter's tools. "Since the Saints," says the _Christian Monitor_, "have laboured, so shall the Christian learn that by honourable labour he can glorify God, do good, and save his own soul."'[3] Work was, alongside of prayer and inseparable from it, the perfection of Christian life.[4]

[Footnote 1: _Christianity and Economic Science_, pp. 26-7.]

[Footnote 2: _Op. cit._, vol. i. p. 187.]

[Footnote 3: Janssen, _op. cit._, vol. ii. p. 9.]

[Footnote 4: Wallon, _op. cit._, vol. i. p. 410.]

It must not be supposed, however, that manual labour alone was thought worthy of praise. On the contrary, the necessity for mental and spiritual workers was fully appreciated, and all kinds of labour were thought equally worthy of honour. 'Heavy labourer's work is the inevitable yoke of punishment, which, according to God's righteous verdict, has been laid upon all the sons of Adam. But many of Adam's descendants seek in all sorts of cunning ways to escape from the yoke and to live in idleness without labour, and at the same time to have a superfluity of useful and necessary things; some by robbery and plunder, some by usurious dealings, others by lying, deceit, and all the countless, forms of dishonest and fraudulent gain, by which men are for ever seeking to get riches and abundance without toil. But while such men are striving to throw off the yoke righteously imposed on them by God, they are heaping on their shoulders a heavy burden of sin. Not so, however, do the reasonable sons of Adam proceed; but, recognising in sorrow that for the sins of their first father God has righteously ordained that only through the toil of labour shall they obtain what is necessary to life, they take the yoke patiently on them.... Some of them, like the peasants, the handicraftsmen, and the tradespeople, procure for themselves and others, in the sweat of their brows and by physical work, the necessary sustenance of life. Others, who labour in more honourable ways, earn the right to be maintained by the sweat of others' brows--for instance, those who stand at the head of the commonwealth; for by their laborious exertion the former are enabled to enjoy the peace, the security, without which they could not exist. The same holds good of those who have the charge of spiritual matters....'[1] 'Because,' says Aquinas, 'many things are necessary to human life, with which one man cannot provide himself, it is necessary that different things should be done by different people; therefore some are tillers of the soil, some are raisers of cattle, some are builders, and so on; and, because human life does not simply mean corporal things, but still more spiritual things, therefore it is necessary that some people should be released from the care of attending to temporal matters. This distribution of different offices amongst different people is in accordance with Divine providence.'[2]

[Footnote 1: Langenstein, quoted in Janssen, _op. cit._, p. 95.]

[Footnote 2: _Summa Cont. Gent_., iii. 134.]

All forms of labour being therefore admitted to be honourable and necessary, there was no difficulty felt about justifying their reward. It was always common ground that services of all kinds were entitled to be properly remunerated, and questions of difficulty only arose when a claim was made for payment in a transaction where the element of service was not apparent.[1] The different occupations in which men were engaged were therefore ranked in a well-recognised hierarchy of dignity according to the estimate to which they were held to be entitled. The Aristotelean division of industry into _artes possessivae_ and _artes pecuniativae_ was generally followed, the former being ranked higher than the latter. 'The industries called _possessivae_, which are immediately useful to the individual, to the family, and to society, producing natural wealth, are also the most natural as well as the most estimable. But all the others should not be despised. The natural arts are the true economic arts, but the arts which produce artificial riches are also estimable in so far as they serve the true national economy; the commutation of the exchanges and the _cambium_ being necessary to the general good, are good in so far as they are subordinate to the end of true economy. One may say the same thing about commerce. In order, then, to estimate the value of an industrial art, one must examine its relation to the general good.'[2] Even the _artes possessivae_ were not all considered equally worthy of praise, but were ranked in a curious order of professional hierarchy. Agriculture was considered the highest, next manufacture, and lastly commerce. Roscher says that, whereas all the scholastics were agreed on the excellence of agriculture as an occupation, the best they could say of manufacture was _Deo non displicet_, whereas of commerce they said _Deo placere non potest_; and draws attention to the interesting consequence of this, namely, that the various classes of goods that took part in the different occupations were also ranked in a certain order of sacredness. Immovables were thought more worthy of protection against execution and distress than movables, and movables than money.[3] Aquinas advises the rulers of States to encourage the _artes possessivae_, especially agriculture.[4] The fullest analysis of the order in which the different _artes possessivae_ should be ranked is to be found in Buridan's _Commentaries on Aristotle's Politics_. He places first agriculture, which comprises cattle-breeding, tillage, and hunting; secondly, manufacture, which helps to supply man's corporal needs, such as building and architecture; thirdly, administrative occupations; and lastly, commerce. The Christian Exhortation, quoted by Janssen,[5] says, 'The farmer must in all things be protected and encouraged, for all depend on his labour, from the monarch to the humblest of mankind, and his handiwork is in particular honourable and well pleasing to God.'

[Footnote 1: Aquinas, _Summa_, II. ii. 77, 4; Nider, _op. cit._, II. x.]

[Footnote 2: Brants, _op. cit._, p. 82.]

[Footnote 3: _Geschichte_, p. 7.]

[Footnote 4: _De Regimine Principum_, vol. ii. chaps, v. and vi.]

[Footnote 5: _Op. cit._, vol. i. p. 297.]

The division of occupations according to their dignity adopted by Nicholas Oresme is somewhat unusual. He divides professions into (1) honourable, or those which increase the actual quantity of goods in the community or help its development, such as ecclesiastical offices, the law, the soldiery, the peasantry, artisans, and merchants, and (2) degrading--such as _campsores, mercatores monetae sen billonatores.'_[1]

No occupation, therefore, which involved labour, whether manual or mental, gave any ground for difficulty with regard to its remuneration. The business of the trader or merchant, on the other hand, was one which called for some explanation. It is important to understand what commerce was taken to mean. The definition which Aquinas gives was accepted by all later writers: 'A tradesman is one whose business consists in the exchange of things. According to the philosopher, exchange of things is twofold; one natural, as it were, and necessary, whereby one commodity is exchanged for another, or money taken in exchange for a commodity in order to satisfy the needs of life. Such trading, properly speaking, does not belong to traders, but rather to housekeepers or civil servants, who have to provide the household or the State with the necessaries of life. The other kind of exchange is either that of money for money, or of any commodity for money, not on account of the necessities of life, but for profit; and this kind of trade, properly speaking, regards traders.' It is to be remarked in this definition, that it is essential, to constitute trade, that the exchange or sale should be for the sake of profit, and this point is further emphasised in a later passage of the same article: 'Not every one that sells at a higher price than he bought is a trader, but only he who buys that he may sell at a profit. If, on the contrary, he buys, not for sale, but for possession, and afterwards for some reason wishes to sell, it is not a trade transaction, even if he sell at a profit. For he may lawfully do this, either because he has bettered the thing, or because the value of the thing has changed with the change of place or time, or on account of the danger he incurs in transferring the thing from one place to another, or again in having it carried by hand. In this sense neither buying nor selling is unjust.'[2] The importance of this definition is that it rules out of the discussion all cases where the goods have been in any way improved or rendered more valuable by the services of the seller. Such improvement was always reckoned as the result of labour of one kind or another, and therefore entitled to remuneration. The essence of trade in the scholastic sense was selling the thing unchanged at a higher price than that at which it had been bought, for the sake of gain.[3]

[Footnote 1: _Tractatus de Origine, etc., Monetarum_.]

[Footnote 2: _Tractatus de Origine, etc., Monetarum_, ad. 2.]

[Footnote 3: 'Fit autem mercatio cum non ut emptor ea utatur sed ut earn carius vendat etiam non mutatam suo artificio; illa mercatio dicitur proprie negotiatio' (Biel, _op. cit._, IV. xv. 10.)]

The legitimacy of trade in this sense was only gradually admitted. The Fathers of the Church had with one voice condemned trade as being an occupation fraught with danger to the soul. Tertullian argued that there would be no need of trade if there were no desire for gain, and that there would be no desire for gain if man were not avaricious. Therefore avarice was the necessary basis of all trade.[1] St. Jerome thought that one man's gain in trading must always be another's loss; and that, in any event, trade was a dangerous occupation since it offered so many temptations to fraud to the merchant.[2] St. Augustine proclaimed all trade evil because it turns men's minds away from seeking true rest, which is only to be found in God, and this opinion was embodied in the _Corpus Juris Canonici_.[3] This early view that all trade was to be indiscriminately condemned could not in the nature of things survive experience, and a great step forward was taken when Leo the Great pronounced that trade was neither good nor bad in itself, but was rendered good or bad according as it was honestly or dishonestly carried on.[4]

[Footnote 1: _De Idol_., xi.]

[Footnote 2: Ashley, _op. cit._, vol. i. pt. i. p. 129.]

[Footnote 3: See _Corpus Juris Canonici_, Deer. I.D. 88 c. 12.]

[Footnote 4: _Epist. ad Rusticum_, c. ix.]

The scholastics, in addition to condemning commerce on the authority of the patristic texts, condemned it also on the Aristotelean ground that it was a chrematistic art, and this consideration, as we have seen above, enters into Aquinas's article on the subject.[1]

[Footnote 1: Rambaud, _op. cit._, p. 52.]

The extension of commercial life which took place about the beginning of the thirteenth century, raised acute controversies about the legitimacy of commerce. Probably nothing did more to broaden the teaching on this subject than the necessity of justifying trade which became more and more insistent after the Crusades.[1]

[Footnote 1: On the economic influence of the Crusades the following works may be consulted: Blanqui, _Histoire de l'Economie politique_; Heeren, _Essai sur l'Influence politique et sociale des Croisades_; Scherer, _Histoire du Commerce_; Prutz, _Culturgeschichte der Kreuzzüge_; Pigonneau, _Histoire du Commerce de la France_; List, _Die Lehren der Handelspolitischen Geschichte_.]

By the time of Aquinas the necessity of commerce had come to be fully realised, as appears from the passage in the _De Regimine Principum_: 'There are two ways in which it is possible to increase the affluence of any State. One, which is the more worthy way, is on account of the fertility of the country producing an abundance of all things which are necessary for human life, the other is through the employment of commerce, through which the necessaries of life are brought from different places. The former method can be clearly shown to be the more desirable.... It is more admirable that a State should possess an abundance of riches from its own soil than through commerce. For the State which needs a number of merchants to maintain its subsistence is liable to be injured in war through a shortage of food if communications are in any way impeded. Moreover, the influx of strangers corrupts the morals of many of the citizens... whereas, if the citizens themselves devote themselves to commerce, a door is opened to many vices. For when the desire of merchants is inclined greatly to gain, cupidity is aroused in the hearts of many citizens.... For the pursuit of a merchant is as contrary as possible to military exertion. For merchants abstain from labours, and while they enjoy the good things of life, they become soft in mind and their bodies are rendered weak and unsuitable for military exercises.... It therefore behoves the perfect State to make a moderate use of commerce.'[1]

[Footnote 1: ii. 3.]

Aquinas, who, as we have seen, recognised the necessity of commerce, did not condemn all trade indiscriminately, as the Fathers had done, but made the motive with which commerce was carried on the test of its legitimacy: 'Trade is justly deserving of blame, because, considered in itself, it satisfies the greed for gain, which knows no limit, and tends to infinity. Hence trading, considered in itself, has a certain debasement attaching thereto, in so far as, by its very nature, it does not imply a virtuous or necessary end. Nevertheless gain, which is the end of trading, though not implying, by its nature, anything virtuous or necessary, does not, in itself, connote anything sinful or contrary to virtue; wherefore nothing prevents gain from being directed to some necessary or even virtuous end, and thus trading becomes lawful. Thus, for instance, a man may intend the moderate gain which he seeks to acquire by trading for the upkeep of his household, or for the assistance of the needy; or again, a man may take to trade for some public advantage--for instance, lest his country lack the necessaries of life--and seek gain, not as an end, but as payment for his labour.'[1] This is important in connection with what we have said above as to property, as it shows that the trader was quite justified in seeking to obtain more profits, provided that they accrued for the benefit of the community. This justification of trade according to the end for which it was carried on, was not laid down for the first time by Aquinas, but may be found stated in an English treatise of the tenth century entitled _The Colloquy of Archbishop Alfric_, where, when a doctor asks a merchant if he wishes to sell his goods for the same price for which he has bought them, the merchant replies: 'I do not wish to do so, because if I do so, how would I be recompensed for my trouble? but I wish to sell them for more than I paid for them so that I might secure some gain wherewith to support myself, my wife, and family.'[2]

[Footnote 1: II. ii. 77, 4.]

[Footnote 2: Loria, _Analysi de la proprietà, capitalista_, ii. 168.]

In spite of the fact that the earlier theory that no commercial gain which did not represent payment for labour could be justified was still maintained by some writers--for instance, Raymond de Pennafort[1]--the teaching of St. Thomas Aquinas was generally accepted throughout the later Middle Ages. Canonists and theologians accepted without hesitation the justification of trade formulated by Aquinas.[2] Henri de Gand,[3] Duns Scotus,[4] and François de Mayronis [5] unhesitatingly accepted the view of Aquinas, and incorporated it in their works.[6] 'An honourable merchant,' says Trithemius, 'who does not only think of large profits, and who is guided in all his dealings by the laws of God and man, and who gladly gives to the needy of his wealth and earnings, deserves the same esteem as any other worker. But it is no easy matter to be always honourable in all mercantile dealings and not to become usurious. Without commerce no community can of course exist, but immoderate commerce is rather hurtful than beneficial, because it fosters greed of gain and gold, and enervates and emasculates the nation through love of pleasure and luxury.'[7] Nider says that to buy not for use but for sale at a higher price is called trade. Two special rules apply to this: first, that it should be useful to the State, and second, that the price should correspond to the diligence, prudence, and risk undertaken in the transaction.[8]

[Footnote 1: _Summa Theologica_, II. vii. 5.]

[Footnote 2: Ashley, _op. cit._, p. 55.]

[Footnote 3: _Quodlib_., i. 40.]

[Footnote 4: _Lib. Quat. Sent._, xv. 2.]

[Footnote 5: iv. 16, 4.]

[Footnote 6: See Jourdain, _op. cit._, p. 20 _et seq_.]

[Footnote 7: Quoted in Janssen, _op. cit._, vol. ii. p. 97.]

[Footnote 8: _Op. cit._, iv. 10.]

The later writers hi the fifteenth century seem to have regarded trade more liberally even than Aquinas, although they quote his dictum on the subject as the basis of their teaching. Instead of condemning all commerce as wrong unless it was justified by good motives, they were rather inclined to treat commerce as being in itself colourless, but capable of becoming evil by bad motives. Carletus says: 'Commerce in itself is neither bad nor illegal, but it may become bad on account of the circumstances and the motive with which it is undertaken, the persons who undertake it, or the manner in which it is conducted. For instance, commerce undertaken through avarice or a desire for sloth is bad; so also is commerce which is injurious to the republic, such as engrossing.'[1]

[Footnote 1: _Summa Angelica_, 169: 'Mercatio non est mala ex genere, sed bona, humano convictui necessaria dum fuerit justa. Mercatio simpliciter non est peccatum sed ejus abusus.' Biel, _op. cit._, iv. xv. 10.]

Endemann, having thoroughly studied all the fifteenth-century writers on the subject, says that commerce might be rendered unjustifiable either by subjective or objective reasons. Subjective illegality would arise from the person trading--for instance, the clergy--or the motive with which trade was undertaken; objective illegality on account of the object traded in, such as weapons in war-time, or the bodies of free men.[1] Speculative trading, and what we to-day call profiteering, were forbidden in all circumstances.[2]

[Footnote 1: _Studien_, vol. ii. p. 18.]

[Footnote 2: _The Ayenbite of Inwit_, a thirteenth-century confessor's manual, lays it down that speculation is a kind of usury. (Rambaud, _Histoire_, p. 56.)]

We need not dwell upon the prohibition of trading by the clergy, because it was simply a rule of discipline which has not any bearing upon general economic teaching, except in so far as it shows that commerce was considered an occupation dangerous to virtue. Aquinas puts it as follows: 'Clerics should abstain not only from things that are evil in themselves, but even from those that have an appearance of evil. This happens in trading, both because it is directed to worldly gain, which clerics should despise, and because trading is open to so many vices, since "a merchant is hardly free from sins of the lips." [1] There is also another reason, because trading engages the mind too much with worldly cares, and consequently withdraws it from spiritual cares; wherefore the Apostle says:[2] "No man being a soldier to God entangleth himself with secular business." Nevertheless it is lawful for clerics to engage in the first-mentioned kind of exchange, which is directed to supply the necessaries of life, either by buying or by selling.'[3] The rule of St. Benedict contains a strong admonition to those who may be entrusted with the sale of any of the products of the monastery, to avoid all fraud and avarice.[4]

[Footnote 1: Eccles. xxvi. 28.]

[Footnote 2: 2 Tim. ii. 4.]

[Footnote 3: _Summa_, II. ii. 77, 4, ad. 3.]

[Footnote 4: _Beg. St. Ben._, 57.]

On the whole, the attitude towards commerce seems to have grown more liberal in the course of the Middle Ages. At first all commerce was condemned as sinful; at a later period it was said to be justifiable provided it was influenced by good motives; while at a still later date the method of treatment was rather to regard it as a colourless act in itself which might be rendered harmful by the presence of bad motives. This gradual broadening of the justification of commerce is probably a reflection of the necessities of the age, which witnessed a very great expansion of commerce, especially of foreign trade. In the earlier centuries remuneration for undertaking risk was prohibited on the authority of a passage in the Gregorian Decretals, but the later writers refused to disallow it.[1] The following passage from Dr. Cunningham's _Growth of English Industry and Commerce_ correctly represents the attitude of the Church towards commerce at the end of the Middle Ages: 'The ecclesiastic who regarded the merchant as exposed to temptations in all his dealings would not condemn him as sinful unless it were clear that a transaction were entered on solely for greed, and hence it was the tendency for moralists to draw additional distinctions, and refuse to pronounce against business practices where common sense did not give the benefit of the doubt.'[2] We have seen that one motive which would justify the carrying on of trade was the desire to support one's self and one's family. Of course this motive was capable of bearing a very extended and elastic interpretation, and would justify increased commercial profits according as the standard of life improved. The other motive given by the theologians, namely, the benefit of the State, was also one which was capable of a very wide construction. One must remember that even the manual labourer was bound not to labour solely for avaricious gain, but also for the benefit of his fellow-men. 'It is not only to chastise our bodies,' says Basil, 'it is also by the love of our neighbour that the labourer's life is useful so that God may furnish through us our weaker brethren';[3] and a fifteenth-century book on morality says: 'Man should labour for the honour of God. He should labour in order to gain for himself and his family the necessaries of life and what will contribute to Christian joy, and moreover to assist the poor and the sick by his labours. He who acting otherwise seeks only the pecuniary recompense of his work does ill, and his labours are but usury. In the words of St. Augustine, "thou shalt not commit usury with the work of thy hands, for thus wilt thou lose thy soul,"'[4] The necessity for altruism and regard for the needs of one's neighbour as well as of one's self were therefore motives necessary to justify labour as well as commerce; and it would be wrong to conclude that the teaching of the scholastics on the necessity for a good motive to justify trade operated to damp individual enterprise, or to discourage those who were inclined to launch commercial undertakings, any more than the insistence on the need for a similar motive in labourers was productive of idleness. What the mediæval teaching on commerce really amounted to was that, while commerce was as legitimate as any other occupation, owing to the numerous temptations to avarice and dishonesty which it involved, it must be carefully scrutinised and kept within due bounds. It was more difficult to insure the observance of the just price in the case of a sale by a merchant than in one by an artificer; and the power which the merchant possessed of raising the price of the necessaries of life on the poor by engrossing and speculation rendered him a person whose operations should be carefully controlled.

[Footnote 1: Cunningham, _Growth of English Industry and Commerce_, vol. i. p. 255.]

[Footnote 2: P. 255.]

[Footnote 3: _Reg. Fus. Tract._, XXXVII. i.]

[Footnote 4: Quoted in Janssen, _op. cit._, vol. ii. p. 9.]

Finally, it must be clearly understood that the attempt of some modern writers to base the mediæval justification of commerce on an analysis of all commercial gains as the payment for labour rests on a profound misunderstanding. As we have already pointed out, Aquinas distinctly rules out of consideration in his treatment of commerce the case where the goods have been improved in value by the exertions of the merchant. When the element of labour entered into the transaction the matter was clearly beyond doubt, and the lengthy discussion devoted to the question of commerce by Aquinas and his followers shows that in justifying commercial gains they were justifying a gain resting not on the remuneration for the labour, but on an independent title.

§ 8. _Cambium_.

There was one department of commerce, namely, _cambium_, or money-changing, which, while it did not give any difficulty in theory, involved certain difficulties in practice, owing to the fact that it was liable to be used to disguise usurious transactions. Although _cambium_ was, strictly speaking, a special branch of commerce, it was nevertheless usually treated in the works on usury, the reason being that many apparent contracts of _cambium_ were in fact veiled loans, and that it was therefore a matter of importance in discussing usury to explain the tests by which genuine and usurious exchanges could be distinguished. Endemann treats this subject very fully and ably;[1] but for the purpose of the present essay it is not necessary to do more than to state the main conclusions at which he arrives.

[Footnote 1: _Studien_, vol. i. p. 75.]

Although the practice of exchange grew up slowly and gradually during the later Middle Ages, and, consequently, the amount of space devoted to the discussion of the theory of exchange became larger as time went on, nevertheless there is no serious difference of opinion between the writers of the thirteenth century, who treat the subject in a fragmentary way, and those of the fifteenth, who deal with it exhaustively and systematically. Aquinas does not mention _cambium_ in the _Summa_, but he recognises the necessity for some system of exchange in the _De Eegimine Principum_.[1] All the later writers who mention _cambium_ are agreed in regarding it as a species of commerce to which the ordinary rules regulating all commerce apply. Francis de Mayronis says that the art of _cambium_ is as natural as any other kind of commerce, because of the diversity of the currencies in different kingdoms, and approves of the campsor receiving some remuneration for his labour and trouble.[2] Nicholas de Ausmo, in his commentary on the _Summa Pisana_, written in the beginning of the fifteenth century, says that the campsor may receive a gain from his transactions, provided that they are not conducted with the sole object of making a profit, and that the gain he may receive must be limited by the common estimation of the place and time. This is practically saying that _cambium_ may be carried on under the same conditions as any other species of commerce. Biel says that _cambium_ is only legitimate if the campsor has the motive of keeping up a family or benefiting the State, and that the contract may become usurious if the gain is not fair and moderate.[3] The right of the campsor to some remuneration for risk was only gradually admitted, and forms the subject of much discussion amongst the jurists.[4] This hesitation in allowing remuneration for risk was not peculiar to _cambium_, but, as we have seen above, was common to all commerce. Endemann points out how the theologians and jurists unanimously insisted that _cambium_ could not be justified except when the just price was observed, and that, when the doctrine attained its full development, the element of labour was but one of the constituents in the estimation of that price.[5]

[Footnote 1: 'Cum enim extraneae monetae communicantur in permutationibus oportet recurrere ad artem campsoriam, cum talia numismata non tantum valeant in regionibus extraneis quantum in propriis (_De Reg. Prin._, ii. 13).]

[Footnote 2: In _Quot. Lib. Sent._, iv. 16, 4.]

[Footnote 3: _Op. oil_., IV. xv. 11.]

[Footnote 4: Endemann, _Studien_, vol. i. pp. 123-36.]

[Footnote 5: _Ibid._, p. 213.]

All the writers who treated of exchange divided it into three kinds; ordinary exchange of the moneys of different currencies (_cambium minutum_), exchange of moneys of different currencies between different places, the justification for which rested on remuneration for an imaginary transport (_cambium per litteras_), and usurious exchange of moneys of the same currency (_cambium siccum_). The former two species of cambium were justifiable, whereas the last was condemned.[1]

[Footnote 1: Laurentius de Rodulfis, _De Usuris_, pt. iii. Nos. 1 to 5.]

The most complete treatise on the subject of money exchange is that of Thomas da Vio, written in 1499. The author of this treatise divides money-changing into three kinds, just, unjust, and doubtful. There were three kinds of just change; _cambium minutum_, in which the campsor was entitled to a reasonable remuneration for his labour; _cambium per litteras_, in which the campsor was held entitled to a wage (_merces_) for an imaginary transportation; and thirdly, when the campsor carried money from one place to another, where it was of higher value. The unjust change was when the contract was a usurious transaction veiled in the guise of a genuine exchange. Under the doubtful changes, the author discusses various special points which need not detain us here.

Thomas da Vio then goes on to discuss whether the justifiable exchange can be said to be a species of loan, and concludes that it can not, because all that the campsor receives is an indemnity against loss and a remuneration for his labour, trouble, outlay, and risk, which is always justifiable. He then goes on to state the very important principle, that in _cambium_ money is not to be considered a measure of value, but a vendible commodity,[1] a distinction which Endemann thinks was productive of very important results in the later teaching on the subject.[2] The last question treated in the treatise is the measure of the campsor's profit, and here the contract of exchange is shown to be on all fours with every other contract, because the essential principle laid down for determining its justice is the observance of the equivalence between both parties.[1]

[Footnote 1: 'Numisma quamvis sit mensura et instrumentum in permutationibus; tamen per se aliquid esse potest.' It is this principle that justifies the treatment of _cambium_ in this section rather than the next.]

[Footnote 2: _Studien_, vol. ii. p. 212.]