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HIS109Y1 Lecture Notes - Middle Ages, Manorialism, Feudalism

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Kenneth Bartlett

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Sept. 27th, 2010
Mercantile Economy
Very little produced beyond which people needed to survive; this was known as a
manorial economy
Towns, Commerce and Economic Change
Breakdown of the manorial economy:
Crusades stimulated long-distance trade, required capitalization of money,
fostered states of trade, cities that provided basic materials for trading
Individual trades benefitted as well (for ex. ship-building)
Trades mobilized to provide for the needs of men
Goods and services could not be paid for by a bartering economy, thus intro of
Some kind of generally accepted medium of exchange was required (money)
Services providing support over long distances established trading relations
War and expansion lead to knowledge of the enemy
Sophisticated money economies in the far-eastern nations, Western traders had to
pay in cash
1348: black death broke out; always was recurrent plagues, but nothing like the
black plague
Up to 50 % of the population died, human suffering was extreme
Upside to widespread death sellers market in labour, if you lived you could offer
labour services for more money due to the small population of peasants, also able
to improve terms of employment
Those who survived were better off
All of Western Europe tended to be a different place; there was a new dynamic
making it an exciting place to be
Idea of enterprise and business became powerful growth in cities, new classes
The way business was done was an important factor in how Europe changed,
there were now new classes that challenged those that had gone before
New means of business organization lead to the accumulation of large amounts of
New class of townsmen, the bourgeoisie; challenged the feudal orders while
growing richer
Fundamental changes in the structure of European society permitted people to
do things differently, challenge the old order

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Merchants had to spend a lot of time away; this was often risky
Style of early capitalism was highly personal, and limited to the amount of money
that an individual could amass to put the capital in place
Enforceable contract required to put capital together in a more reasonable place
Thus; a system was developed where individuals would put their capital together,
or labour, (investment of time or capital) making everyone responsible for the
Several men would pool money, another would agree to do the actual voyage
taking on dangers and risks, another agreed to ensure the entire operation
(everyone signed on to this contract, profits they would receive if everything
turned out right, was legally-binding, rich merchants could get very large
amounts of capital
Merchants with large amounts of capital became the rulers people who made
economy and social structures of towns operate, had wealth, leisure to run the
By taking on rigors there was a greater profit
People who ran towns became richer, developed into a set of patricians, did not
like being patronized by the nobles
Able to rule over cities, and the surrounding territories, became a group in a
thorn of the psychological side of the feudal rulers
Merchants didnt really fit in the 3rd estate, they were not peasants or craftsman;
there was a movement to redistribute wealth and power in Europe so that these
new groups could be recognized
Success and business also lead to new expansions of urban growth = cities grew
New outlets for wealth had to be found, another way to get richer and use surplus
capital to ensure that power and wealth would grow
Merchants entered the field of banking, anyone who had any extra cash put it
with merchants who promised them a return by giving them some of the interest
from those who borrowed capital
Wealth of mercantile cities grew drastically, however; there were risks
Contracts had to be made against those who had political prestige and the ability
to overrule law due to military strength
For ex. the Bardi and Peruzzi banks collapsed:
Banked both sides during the 100 years war, King Edward realized that he owed
them a lot of money (more than he could pay back)
As a feudal monarch he was controlled by no one, he defaulted on his loans, thus
the two firms collapsed, along with thousands of others that were dependent on
The result was a huge depression in Florence and all of Europe
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