FINANCIAL SYSTEMS IN THE FOURTEENTH/FIFTEENTH CENTURIES FOR THE NON-NOBILITY

Much of our knowledge of finances dwells on the assets of the Crown and nobility/landed gentry. The paper will touch on these in the context of the Italian bankers. The narrow focus of this paper is to consider the ways in which the ordinary folk of the period could earn money and improve their financial position, rather than to cover trade and coinage. The ordinary folk were those most exposed to the vagaries of the weather with failing harvests, failing agricultural prices, and punitive taxes to pay for foreign wars.

The principal paths to earning and investment were:

  • Agriculture/land
  • Education
  • Commerce
  • Military/naval service
  • Social mobility/adherence to a noble family.

The lower classes or peasantry normally earned their living either by agricultural work or domestic service. Payment was usually in kind, ie food or access to a plot of land to cultivate for themselves. But they were probably still expected to return a portion in kind to their landlord. Some payments were made in coin, and the barter system with peers was in use. The normal levels of daily payment in coin (in 1391-1400) ranged between 3 ¼d for a labourer and 6d for a mason. Women were paid half the rate of men. The ban on working on Sundays and holy days restricted the capacity to earn. Domestic service did not pay well, not even in the Royal households.

The principalengine for change in the social structure of the country, by enhancing the value of the labourer, was the Black Death (1346-1353); the direct impact of the Peasants’ Revolt (1381) remains somewhat unclear, although it imposed some limits on Parliament’s aims of extracting further taxation to fund the French Wars. These Wars, and the Wars of the Roses were also instrumental in encouragingsocial mobility, offering opportunities for booty and promotion to senior positions. The military were paid in cash.

There were associatedproblems with cash: the coinage was usually only in high denominations and smaller denominations were not common; parity in the items bartered was difficult to achieve. Otherwise, loans and credit were available, although based on the credit-worthiness of the borrower, as today. The main sources of loans in the twelfth and thirteenth centuries were the Jews; the Italians were involved principally with the upper classes and the Crown. The Jewshad been brought over to England by the Normans, essentially to act as their sources of revenue.There were around 1000 at the time of the Conquest, but their number had declined to some500 by the time of their expulsion in 1290. Their special position afforded them the King’s protection, and the Tower of London was their refuge in times of hostility. The Jews were able to lend to the wealthier rural populations until the Statute of Jewry of 1275, when they were prohibited from making loans at interest against the security of lands or moveable goods. This had changed by 1284-86 when they were again authorised to loan at interest. But by 1290, when Edward I expelled them, they had been bankrupted as much by punitive royal taxes as unpaid loans, and were no longer able to serve the poorer members of the population.

After the Jews’ expulsion, English creditors grew in importance, increasingly including merchants, great and small. Wealthy English Churchmen and landlords also played this role. While the Church was officially banned from charging interest, as usury was regarded as incompatible with Christian teaching, many Church officers did charge interest, and sometimes at high rates, as much as 10%.

Hard cash became more readily available to the peasantry as their labour became more valued, ie when in short supply after the Black Death. Even so, there were times when there was insufficient coin to meet daily needs or more ambitious projects, largely because of a shortage of bullion (mainly gold) to mint the coins. Access to credit usually meant that the applicant had to have a good reputation or sufficient material goods to offer collateral, and hard cash was not always involved.The peasantry largely borrowed from each other. Loans were generally repaid on time, but there was access to law against defaulters. Punishments were imprisonment, or confiscation of assets and land. Alternatively, a deferred payment was agreed to an extended timescale, or items of value, eg jewellery, were pawned. Or lands were sold or sub-let.

Cash transactions were not always easy for the lower paid, even though the English coins were largely trusted for their consistent bullion content. The coinage was mostly in high denominations of gold or silver (principally gold in Europe, while silver was the commonest currency in Arab lands, until the later Middle Ages saw a turnaround). Lower denomination coins were minted: pennies, half-pennies and farthings; in the reign of Edward III, they were minted in silver. But they were not generally trusted by those who were obliged to use them as the quantity of bullion in them was low. And debasing of the coinage was not to the advantage of the lower sections of society. There were also periods when coinage was short, and workers had to be paid half in cash and half in goods. This was forbidden in the Parliament of 1463-65. Edward IV ordered a recoinage in 1464. A recoinage essentially entailed standardising the bullion weight of the coins. In order to prevent fraud with foreign coins, merchants, such as the Celys, had scales in their workshops.

Having secured some financial stability, a peasant farmer could pay for his children to be educated. Local schools could offer a basic standard; the more gifted could proceed to Universities such as Oxford and Cambridge, and then to Law Schools and the Inns of Court in London, or to the higher echelons of the Clergy. Literacy was highly prized, and normally reserved to clericsand the nobility; growth of literacy was promoted when merchants were required to teach their apprentices to read and write or face being sued for a return of the apprenticeship fees. Literacy was not always extended to females in the family. The Paston wives had some penmanship, but may also have relied on others better skilled, ie their estate managers.

Public schools for the education of the lower classes produced Winchester College, started by William of Wykeham in 1382, Westminster School founded in 1371, St Paul’s School (formally established in 1509, but founded on a monastic site in 1103), and Eton College, started by Henry VI in 1440.Harrow School, although founded in 1243, only received its modern Charter in 1572. Those trained in the law were especially well placed to achieve high judicial office and earn well, eg Lord Chancellor, and were, to some extent, independent of patronage; or their good reputation would provide a lucrative source of clients. Others might become Stewards to a prominent household, but their independence was accordingly limited. Access to learning also enabled progress towards prominent clerical positions.

Those who had acquired sufficient capital to trade or buy their own land could develop their own business. The wool trade was especially lucrative, either for export or as the raw material for clothing. Trade was largely limited to the nearest ports on the European mainland (Flanders for the wool trade), although some went further afield to Russia, and to the East via Venice and Genoa. Trade involved rather more complex funding arrangements, eg shipping and use of agents on the spot. For this, the Italian bankers came into play.

The Italian bankers managed transactions which were beyond the means of the ordinary citizen: they catered almost exclusively for the nobility and the Crown: the Riccardi had served Edward I, the Frescobaldi Edward II, the Peruzzi Edward III. The Bankers were collectors of Papal revenues, and held large deposits of cash. Asinternational traders, they were probably the originators of what could be called “paper money”, or letters of credit passed from one agent to another, obviating physical transfers of cash. In our own period, Edward IV obtained loans from the Italians (the Medici and a Florentine merchant, Gerard Caniziani) and from pawning certain Crown Jewels to the London goldsmith, Hugh Brice. Italians were also prominent in facilitating various of Edward’s commercial transactions: James de Sanderico, and Alan de Monteferrato. The Medici acted as factors in the payment of Louis XI’s payments to Edward after the Treaty of Picquigny. Edward also used the system of Benevolences. King Richard does not appear to have used the Italians; instead he turned to forced loans and pawning certain of the crown jewels to finance his military excursions.

The merchant classes did not generally make it to the upper classes of society, given the hierarchical nature of mediaeval society, although the gentry and nobility did involve themselves in trade. Trading and financial centres in the Middle Ages were the City of London, Norwich (the second most important city at the time), York, and the Kent ports. They were also the centres which had Mints (as did Calais).

The French Wars offered some of the easiest opportunities for enrichment: the lower classes would be enrolled as archers, or yeomen, and would generally seek out booty following the sack of a town. The nobility, on the other hand, would seek to capture a high-ranking opponent for ransom, and be rewarded with lands and manors. Promising lower class soldiers could be promoted to senior ranks, so enhancing chances for enrichment.

Following the Black Death, the scarcity of manual labourers offered more opportunities for women to work, whether in commercial or manual labouring tasks, and skilled or unskilled labour. But the situation of unmarried women barred them from acting independently. It was as widows that they were more at liberty to exercise a trade and earn their living. Dr Helen Castor offers the example of the widow of a Bell Foundry owner in London who successfully took over management of the foundry until her own death.

Storing one’s cash or valuables was fairly rudimentary, principally in large chests,unless there were access to bankers who could offer more protection. Insurance for the lesser privilege did not exist. It was limited to the merchant classes, and was almost exclusively marine insurance. The concept was initiated by the Italians: the records of one remarkable Italian (Francesco di Marco Datini), who based himself in Avignon, provide extensive details. His famous phrase (not unknown today) was: “For when they insure it is sweet to them to take monies, but when disaster comes it is otherwise, and each man draws his rump back and strives not to pay”. The London merchants were slow to follow their continental peers, although they had been at a disadvantage since the Hanseatic and Lombard merchants had enjoyed special privileges in the City since the 10th century. And today it is Lloyds of London which dominates the insurance market.

The best examples of the various routes to wealth are:

  • The Pastons of Norfolk: their ancestor, Clement Paston, was a peasant farmer in the late fourteenth century; he sent his son, William, to London to study the law. Through considerable intelligence and hard work, he secured a position as one of the King’s most senior judicial representatives. His descendants were eventually ennobled to become Earls of Yarmouth; fortune deserted them in the late 17th century, and the title fell into desuetude;
  • Prominent clerics progressing from the lower classes are fewer: Cardinal Wolsey was one: his father was reputed to have been a butcher and cattle dealer; Wolsey moved up through clerical ranks, even aspiring to be Pope;his wealth was reportedly acquired through corruption;
  • The de la Pole family (as distinct from the Pole family) developed their wealth from the wool trade in Hull; they eventually acquired the title of Earl of Suffolk; the Pole family (Lady Margaret Plantagenet married Sir Richard Pole) were already minor gentry; while one de la Pole descendant rose to be Earl Montague; he was the last of that title;
  • The Cely family were already well-established merchants in the wool trade; they did not themselves aspire to nobility, but their descendant, the granddaughter of Geoffrey Chaucer, married , firstly the last Earl Montague (de la Pole family above), and, second, the 4th Earl of Salisbury;
  • Sir John Fastolf is a good example of a soldier who gained considerable wealth from his military career; Caister Castle, regarded as the epitome of luxury at the time, was his main residence. Others were Andrew Trollope, who served under Fastolf and Richard Woodville, and rose to become influential in the Lancastrian cause.

The book from which most of the above was culled (Money in the Mediaeval English Economy: 973-1489, by JL Bolton) is invaluable for detailed information on coinage and general administrative practices. However, only two chapters were directly relevant to this paper. The author tells us that it took him twenty years to write: it is the product of considerable research. I also drew on two interesting articles from the Institute for Technical Research in London (details forwarded from the Guildhall), the Economic History Review and the Time Traveller’s Guide to Mediaeval England. There is certainly much more to say about trade and commerce in the fifteenth century than is covered in this narrow focus. It would be fascinating to consider further the links with North Africa and beyond.