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Cities of Commerce

Cities of Commerce: The Institutional Foundations of International Trade in the Low Countries, 1250-1650

Oscar Gelderblom
Copyright Date: 2013
Pages: 288
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  • Book Info
    Cities of Commerce
    Book Description:

    Cities of Commerce develops a model of institutional change in European commerce based on urban rivalry. Cities continuously competed with each other by adapting commercial, legal, and financial institutions to the evolving needs of merchants. Oscar Gelderblom traces the successive rise of Bruges, Antwerp, and Amsterdam to commercial primacy between 1250 and 1650, showing how dominant cities feared being displaced by challengers while lesser cities sought to keep up by cultivating policies favorable to trade. He argues that it was this competitive urban network that promoted open-access institutions in the Low Countries, and emphasizes the central role played by the urban power holders--the magistrates--in fostering these inclusive institutional arrangements. Gelderblom describes how the city fathers resisted the predatory or reckless actions of their territorial rulers, and how their nonrestrictive approach to commercial life succeeded in attracting merchants from all over Europe.

    Cities of Commerce intervenes in an important debate on the growth of trade in Europe before the Industrial Revolution. Challenging influential theories that attribute this commercial expansion to the political strength of merchants, this book demonstrates how urban rivalry fostered the creation of open-access institutions in international trade.

    eISBN: 978-1-4008-4859-1
    Subjects: Economics, History, Law

Table of Contents

  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
  3. Illustrations
    (pp. ix-x)
  4. Acknowledgments
    (pp. xi-xiv)
  5. CHAPTER 1 Introduction
    (pp. 1-18)

    When Spanish troops captured Antwerp in August 1585 the city’s merchants faced a difficult choice. They could stay, if they accepted the sovereignty of Philip II, but commercial prospects were bleak since large groups of Flemish textile workers had already left for France, England, and Holland and Dutch rebels blocked the river Scheldt and the Flemish coast. An alternative was to move to Protestant London, but here the local business elite actively tried to exclude newcomers. The Atlantic ports of Rouen and Nantes offered good connections to many countries in Western Europe, but France was embroiled in civil war, just...

  6. CHAPTER 2 Commercial Cities
    (pp. 19-41)

    In late medieval and early modern Europe many towns competed to attract foreign merchants and join in the emerging market economy. It was a contradictory competition because rival cities had to collaborate to move up in the urban hierarchy. The most successful ports in the Mediterranean, the Baltic region, or the North Sea area invariably developed close connections to neighboring ports and to the cities in their hinterland that bought foreign products and supplied export commodities. Becoming a principal node in Europe’s urban network also required commercial cities to recruit merchants from other places, to secure their safety while traveling...

  7. CHAPTER 3 The Organization of Exchange
    (pp. 42-75)

    Well-functioning local markets were part and parcel of the growth of long-distance trade in late medieval Europe. In the eleventh and twelfth centuries the expansion of Mediterranean trade led to the concentration of hundreds, sometimes thousands of traders in Venice, Genoa, Constantinople, and Cairo. Here they either visited public vending locations or each other’s designated quarters to inspect goods, negotiate prices, and close deals.¹ Local markets of this size did not exist in Northern Europe before 1300.² Instead, the periodic fairs of Champagne, and to a lesser extent those of Flanders, South-East England, and the Rhineland, allowed face-to-face meetings of...

  8. CHAPTER 4 Crossing Borders
    (pp. 76-101)

    So far we have emphasized the pivotal role of urban governments in the organization of European trade through the creation of wellfunctioning markets frequented by local traders and visiting foreigners. However, international trade by definition implied the transfer of money and goods between markets, and this created an entirely different set of delivery and payment problems.¹ In the Middle Ages the risks involved in trade over long distances were so large that merchants traveled constantly abroad to exchange money and goods in person, thus leaving no residual claims to be settled after they left. The costs of this itinerant trade...

  9. CHAPTER FIVE Conflict Resolution
    (pp. 102-140)

    Premodern Europe was a patchwork of local and regional jurisdictions, each with its own legal traditions. Every commercial city had its own local court applying local laws and customs to business disputes of all kinds.¹ This legal fragmentation was never a problem for merchants who traveled between fairs because their local hosts were both willing and able to tailor court proceedings to the specific nature of their spot transactions.² However, for merchants who settled abroad for longer periods legal fragmentation was a serious concern. Their business was the shipment of money and goods to agents in different places, and as...

  10. CHAPTER 6 The Protection of Trade
    (pp. 141-168)

    Even if Bruges, Antwerp, and Amsterdam did everything they could to support private contracting between international traders, the agency problems that issued from Europe’s legal fragmentation may have been a minor concern compared with the violent threats merchants faced.¹ Traders traveling over land to distant markets were confronted with theft, robbery, or even outright warfare. Violence was at least as disruptive in maritime trade. Between the fourteenth and eighteenth centuries privateering was the principle means by which Europe’s maritime powers tried to harm their adversaries.² In peacetime privateers often turned pirates and continued to pry on shipping. Merchants who got...

  11. CHAPTER 7 Dealing with Losses
    (pp. 169-197)

    In spite of an often very high incidence of violence, many international traders in Bruges, Antwerp, and Amsterdam managed to build very profitable businesses. These merchants were willing to take risks to clear big profits, but high margins alone were not enough to be successful, for the nature of violence was such that individual incidents, whether confiscation, embargo, or the capture of a ship, could lead to large income losses. Very big businesses like those of the Medici, Fugger, or Trip families were probably able to cushion these shocks within their own operations, witness their placing of balances to reserve...

  12. CHAPTER 8 Conclusion
    (pp. 198-210)

    The organization of international trade in the Low Countries shows how urban competition leads to the creation of inclusive institutions that facilitate exchange and help merchants deal with conflicts. Bruges, Antwerp, and Amsterdam built basically permanent vending locations and regulated brokers’ work to support the local and international exchange of money, goods, and information. The cities continuously amended and adapted local customs to create a broader set of contracting rules that suited their heterogeneous business communities. They also supported a variety of institutions for conflict resolution to enable merchants a measured response to any kind of agency problem. In addition...

  13. APPENDIX A The Incidence of Violence against Foreign Merchants in the Low Countries, 1250–1650
    (pp. 211-226)
  14. APPENDIX B The Motivation, Organization, and Outcome of Collective Action by Merchants of the German Hanse in Bruges, 1250–1500
    (pp. 227-232)
  15. List of Abbreviations
    (pp. 233-234)
  16. Bibliography
    (pp. 235-276)
  17. Index
    (pp. 277-293)
  18. Back Matter
    (pp. 294-294)