Economies, Public Finances, and the Impact of Institutional Changes in Interregional Perspective SEUH 36 Studies in European Urban History (1100–1800)

Series Editors Marc Boone Anne-Laure Van Bruaene Ghent University

Economies, Public Finances, and the Impact of Institutional Changes in Interregional Perspective

The Low Countries and Neighbouring German Territories (14th‑17th Centuries)

Edited by Remi van Schaïk

Cover illustration: after Quinten Metsys, The moneylender and his wife, sixteenth century. © [Koninklijke Musea voor Schone Kunsten van België, Brussel / foto: J. Gelyns/ Ro scan]

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Contents

Personalia vii Acknowledgements xi

Introduction

Remi van Schaïk Economies, Public Finances, and the Impact of Institutional Changes in Interregional Perspective: Some Introductory Remarks 3

Peter Hoppenbrouwers Three Decades of Economic and Social History of the Medieval Low Countries: A Summary Survey 11

Marjolein ’t Hart Coercion and Capital Revisited. Recent Trends in the Historiography of State-Formation 23

Industry and Trade

Tim Soens, Peter Stabel & Tineke Van de Walle An Urbanised Countryside? A Regional Perspective on Rural Textile Production in the Flemish West-Quarter (1400‑1600) 35

Job Weststrate The Impact of War on Lower Rhine Trade from the Fifteenth to Seventeenth Centuries 61

Finances and Politics

David Kusman & Jean-Luc Demeulemeester Connecting Regional Capital Markets in the Late Medieval Low Countries: The Role of Piedmontese Bankers as Financial Pathfinders and Innovators in Brabant, Guelders, Flanders and Hainaut (c.1260‑1355) 83

Bart Lambert The Political Side of the Coin: Italian Bankers and the Fiscal Battle between Princes and Cities in the Late Medieval Low Countries 103

v Contents

Rudolf A.A. Bosch The Impact of Financial Crises on the Management of Urban Fiscal Systems and Public Debt The Case of the Duchy of Guelders, 1350‑1550 113

Jelle Haemers A Financial Revolution in Flanders? Public Debt, Representative Institutions, and Political Centralisation in the County of Flanders during the 1480s 135

Evaluation

Wim Blockmans Regional Interactions. Some Afterthoughts 163

Personalia

Wim Blockmans (1945) is emeritus professor at Leiden University. He mainly worked on state formation and representative institutions in late medieval Europe, and the Burgundian Netherlands in particular. His most recent books include Metropolen aan de Noordzee (2010) and Emperor Charles V 1500‑1558 (2002), revised as Karel V, Keizer van een wereldrijk (20124).

Rudolf A.A. Bosch (1984) recieved his MA degree in History at the University of Groningen. Between 2008 and 2014 he was preparing his PhD thesis on the impact of political and economic transformations on urban societies and public finances in the Duchy of Guelders between c. 1350 and 1580 at the Groningen Research Institute for the Study of Culture. He has published on several aspects concerning the urban history in the Low Countries, more specifically the socio-economic history of towns in the Eastern Netherlands and the financial relations between the Duchy of Guelders and the German Lower Rhine area.

Jean-Luc Demeulemeester (1965) is professor at the Université Libre de Bruxelles, at the Solvay Brussels School of Economics and Management, the Political Science Department and at the Arts and Humanities Faculty. At Solvay Brussels School of Economics and Management he is the co-director of the Centre for Economic and Financial History (joint with K. Oosterlinck and J.J. Heirwegh) of the Emile Bernheim Research centre CEB. He is the co-founder and co-editor (with Dora Costa, Berkeley, and Claude Diebolt, CNRS Strasbourg and Humboldt Universität zu Berlin) of Cliometrica. A Journal of Historical Economics and Econometric History.

Jelle Haemers (1980) was trained as an urban historian at the University of Ghent. He is professor at the department of Medieval History of the University of Leuven since 2010 and a member of the Jonge Academie of Belgium since 2013. He wrote his first book on the Ghent revolt of 1449‑1453 (2004). In recent years his research interests have widened to encompass other kinds of social and political conflicts in the late medieval town, notably in the Low Countries (1100‑1600). He also published on the use of social theory and auxiliary sciences in history, the late medieval nobility and the financial history of court and towns. He has completed his second book, on the political conflict between the Flemish cities and Maximilian of Austria in the 1480s (For the Common Good. State Power and Urban Revolts in the Reign of Mary of Burgundy, 1477‑1482 (2009)), which was awarded with the prestigious “Frans van Cauwelaert-prize” of the Royal Academy of Arts and Sciences of Belgium. Most recently his De strijd om het regentschap over Filips de Schone. Opstand, geweld en facties in Brugge, Gent en Ieper (1482‑1488) was published (2014). His current major research project is a study of popular politics in the late medieval town.

Marjolein ’t Hart (1955) specialised in early modern social and economic history. After her graduation and PhD she held positions at various universities (Groningen, Leiden, Erasmus Rotterdam, VU University Amsterdam, University of Amsterdam, New School for Social Studies New York, Trinity College Dublin and Columbia

vii Personalia

University New York) and in various disciplines (history, sociology, political sciences). Her main publications include The Making of a Bourgeois State. War, Politics and Finance during the Dutch Revolt (1993); A Financial History of the Netherlands 1550‑1990 (1997); De wereld en Nederland. Een sociale en economische geschiedenis van de laatste duizend jaar (2011), and The Dutch Wars of Independence. Warfare and Commerce in the Netherlands 1570‑1680 (2014). Presently she is head of the research department of the Huygens Institute for the History of the Netherlands in The Hague and professor History of State Formation in Global Perspective at VU University in Amsterdam.

Peter (P.C.M.) Hoppenbrouwers (1954) is professor of Medieval History at Leiden University. He is the co-author, with Wim Blockmans of Introduction to Medieval Europe 300‑1500 (2014²). His main fields of interest are peasant communities, household and family, local lordship and military organisation, and cultures of violence in the medieval Latin West.

David Kusman (1969), postdoctoral researcher associated with the Interuniversity Attraction Pole Program 7/26 “City & Society in the Low Countries (1200‑1850)” at the Université Libre de Bruxelles, graduated from this university in 2008 with a doctorate in medieval history, published in 2013 in the Studies in European Urban History Series, 28, under the title: Usuriers publics et banquiers du Prince. Le rôle économique des financiers piémontais dans les villes du duché de Brabant (xiiie‑xiv e siècle). His current researches focus on credit and information during the Late Middle Ages.

Bart Lambert (1981) was a research assistant at the University of York, working on the ahrc-funded project “England’s Immigrants, 1330‑1550: Resident Aliens in the Later Middle Ages” and is presently lecturer at Durham University. He is the author of The City, the Duke and their Banker. The Rapondi Family and the Formation of the Burgundian State (1384‑1430) (2006), “Pouvoir et argent. La fiscalité d’État et la consommation du crédit des ducs de Bourgogne (1384‑1506)” (Revue du Nord, 2009), “Bonnore Olivier: courtier de la fiscalité bourguignonne (1429‑1466)” (Revue Belge de Philologie et d’Histoire, 2012) and “Friendly Foreigners: International Warfare, Resident Aliens and the Early

History of Denization in England, c. 1250 ‑c. 1400” (English Historical Review, 2015). He

is currently editing a volume on Luxury Textiles in Italy and the Low Countries during the

Late Medieval and Early Modern Period , to be published with Ashgate.

Remi van Schaïk (1950) studied History at the Katholieke Universiteit

Nijmegen and the University of Ghent. After research fellowships and teaching activities

at the Universities of Nijmegen, Rotterdam and Groningen, he was working as a policy

advisor for research in the Faculty of Arts of the University of Groningen, and is senior lec-

turer in Medieval History at the same university since 1995. He is publishing on financial,

economic and social history, and on socio-religious history, especially of the northern and

eastern Low Countries. His publications include De Tielse kroniek (1983, together with

others), (1985), Walfridus van Bedum Belasting, bevolking en bezit in Gelre en Zutphen

(1987), and substantial parts of (1350‑1550) Onder vele torens. Een geschiedenis van de

gemeente Bedum (2002), and of the Geschiedenis van Groningen, vol. I (2008).

Peter Stabel is professor of Medieval History at the University of Antwerp

and member of the Antwerp based Centre for Urban History. He publishes on the social

Personalia and economic history of the cities of the medieval and early modern Low Countries. His recent research interests cover craft guilds, textile manufacture, labour markets, gender and princely courts in the Low Countries and he is also studying the representation of urbanity and market regulation in the cities of the medieval Islamic world.

Tim Soens (1977) is associate professor of Medieval and Environmental History at the University of Antwerp (Belgium). He has studied Medieval History at the University of Ghent (Belgium), where he obtained his PhD in 2006, investigating water management and the interaction of man and nature in coastal Flanders in the medieval and early modern period. Within the Antwerp Department of History, Tim Soens has developed a new research line “Environment and Power”, concentrating on the historical relationship between human societies and the natural environment, and the way this interaction was steered by evolving power constellations and formal and informal institutions.

Tineke Van de Walle completed her MA degree in History in 2012 at the University of Antwerp. She graduated on a research project concerning pilgrim accounts to Jerusalem in the fifteenth and sixteenth centuries and the perception on urbanity, supervised by Professor Peter Stabel. From 1 October 2013 onwards, she is working as PhD fellow of the Research Foundation Flanders (fwo) on a project on suburbanisation in the late fifteenth and sixteenth at the Centre for Urban History (University of Antwerp).

Job Weststrate (1975) studied history at Leiden University and Humboldt- Universität in Berlin from 1993‑1999. He obtained his PhD at Leiden University for his dissertation In het kielzog van moderne markten. Handel en scheepvaart op de Rijn, Waal en IJssel (2007). Lastly he worked at the University of Groningen as a postdoctoral researcher within the “Cuius Regio”-Project (www.cuius-regio.eu), part of the Eurocorecode programme of the European Science Foundation. His project explored the regional cohe- sion of the Guelders-Lower Rhine region in the Late Middle Ages and Early Modern Period.

Acknowledgements

On 8‑9 June 2012, an international conference took place in the large monumental court room of the former Groningen court, now housing the Faculty of Theology and Religious Studies of the University of Groningen, entitled “Economies, Public Finances, and the Impact of Institutional Change: Towards a Comparative Approach of Regions in the Medieval and Early-Modern Low Countries and its Neighbouring Territories”. The conveners were Rudolf Bosch, MA, and the editor of this volume. The conference was held in the context of an ongoing research project on state formation, economic transformation and urban society in the Duchy of Guelders in the late Middle Ages. The present volume is the result of this conference. The conference was financed by the Groningen Research Institute for the Study of Culture (ICOG), the Posthumus Institute (the Research School for Economic and Social History in the Netherlands and Flanders), the Onderzoekschool Mediëvistiek (Research School for Medieval Studies in the Netherlands and Flanders) and the EuroCORECODE programme “Cuius Regio” (funded by the European Science Foundation). The organisers are most grateful for their generous support. We would also like to thank the chair persons of the panel sessions, Professor Dick E.H. de Boer and Professor Raingard M. Esser, who aptly introduced the speakers and kept discussions well on track. Most of the scholars who presented a paper at the conference kindly agreed to refashion the annotated text of their presentation into a contribution to this volume. Unfortunately not all speakers had the opportunity to join the ranks of the authors. On the other hand, we managed to “contract” one participant of the 11th Conference on Urban History at Prague (August, 29-September 1, 2012), Dr Bart Lambert of Durham University (formerly University of York) to add his reworked presentation delivered in Prague to this volume. I wish to thank all twelve authors for their patience and willingness to include my many comments on earlier drafts and for their helpful suggestions for my introduction to this volume. Finally, as the editor of this volume I am more than happy that the editors of the series “Studies in European Urban History (1100‑1800)”, Professor Marc Boone and Professor Anne-Laure De Bruaene, were prepared to incorporate this collection of essays as a volume in these series after constructive feedback from external referees. I would also like to thank Dr Jelle De Rock, who carefully directed the practical handling of the process from manuscript to book.

Remi van Schaïk Groningen, November 15, 2014

Finances and Politics

Connecting Regional Capital Markets in the Late Medieval Low Countries The Role of Piedmontese Bankers as Financial Pathfinders and Innovators in Brabant, Guelders, Flanders and Hainaut (c. 1260‑1355)*

David Kusman & Jean-Luc Demeulemeester Université Libre de Bruxelles

The objective of this paper is to demonstrate the widespread and sophisticated use of advanced financial techniques in the Late Medieval Low Countries and the ways in which those financial tools helped foster regional economic and financial integration between the end of the thirteenth century and the middle of the fourteenth century. We particularly emphasise the role of Piedmontese moneylenders in connecting the supply-side with the demand-side of fresh capital, along with their ability to design new financial instruments (such as transferable credit instruments and banking accounting techniques), that facilitated the development of interregional capital “markets”. Their financial intermediation suggests that they worked within an advanced financial market, in the sense that Temin posited for the Roman empire.1 Piedmontese moneylenders offered three different types of services: short-term loans, banking services and last but not least, financial advice. They played a key role in circulating debt recognizances. These recognizances sometimes evolved into public debts when an indebted territorial prince or an abbey was forced to launch a massive life annuity sale to reimburse their Italian creditors. However, the exact function of Piedmontese moneylenders in the conversion of these short-term debts into more consolidated debts has not been clarified, a situation this article seeks to rectify.2

* This research benefited from the scientific support of the Interuniversity Attraction Pole VII/26 “City and Society in the Low Countries (ca. 1200-ca. 1850)”, funded by the Belgian State – Federal Public Planning Service, Science Policy (Belspo). We are particularly thankful to Dr Shennan Hutton (University of California, Davis) for having proofread our paper. 1 For the definition of an advanced financial market in the preindustrial era, see Peter Temin, “Financial intermediation in the Early Roman Empire”, in Journal of Economic History, 64, 2004, p. 705‑733, here 712‑713. 2 On the Count of Hainaut and his sale of life-annuities in Mechelen, thanks to local moneychangers keeping current accounts with Lombards, see Homme Jacob Smit (ed.), De rekeningen der graven en gravinnen uit het Henegouwsche huis, vol. 1 (Werken uitgegeven door het Historisch Genootschap gevestigd te Utrecht, 3e S. 46), Amsterdam-Utrecht, 1924, p. 193‑194. The lord of Diest seems also to have covered his numerous loans with the sale of life-annuities by the city of Diest in 1329, see David Kusman, Financiers du Prince ou “usuriers publics”? Le rôle des banquiers piémontais dans les villes du duché de Brabant (xiii e‑xiv e siècle), 4 vols, thèse de doctorat en histoire, art et archéologie, Université Libre de Bruxelles, 2008, vol. 2, p. 339‑340. For abbeys, see the case study of Vaucelles discussed in the second part of this paper. On the general phenomenon of the conversion of short-term debts into medium-term obligations in the Low Countries: Bas van Bavel, Manors and markets. Economy and society in the Low Countries, 500‑1600, Oxford, 2010, p. 186. The author does not adress the issue of the development of new annuity markets.

Economies, Public Finances, and the Impact of Institutional Changes in Interregional Perspective, ed. by Remi Van Schaïk, Turnhout, 2015 (Studies in European Urban History, 36), p. 83‑102. F H G DOI: 10.1484/M.SEUH-EB.5.103707 David Kusman & Jean-Luc Demeulemeester

Interregional circulation of credit instruments promoted tighter integration between regions with abundant funds to loan (Flanders, Brabant) and regions with fewer liquid assets. It was still too early to speak of market integration, because these financiers continued to operate within the “small world of high finance” (in the 1280s and 1290s), although this applied less to the private credit deals in the Cambrésis region (abbey of Vaucelles) and mercantile investments in Flanders. Although heavily dependent on interpersonal links, Piedmontese credit networks anticipated the development of interconnected annuity markets between a number of principalities (Brabant, Guelders and Hainaut). These Italian financiers acted as financial pathfinders, opening up new opportunities to exchange debt instruments for annuities anonymously and on a larger scale. Our study draws on the approach of Botticini, who pointed out that the dynamism of Jewish lenders in Tuscany assisted in linking private credit markets to public finances in the Renaissance Italian towns.3 To develop our thesis we will analyse three case studies in two sections. The first one deals with the political use of credit instruments at the level of territorial states while the second one deals with the role of advanced financial techniques in connecting private actors and urban finances. The first section contains one case study that emerges from the medieval political economy, to show that a territorial prince who needed to pay for a war preferred borrowing money over levying taxes on his subjects. To accomplish this, he had to rely on foreign intermediaries. We analyse the circulation of his loan titles and their use for political purposes (at his expense). The second section contains twe case studies. The first one sheds light on the transfer of techniques from the world of the Italian bankers to the offices of town financial clerks in the context of urban debt in Mechelen (Malines). We explore the role played by successful annuity sales in connecting private and public financial sectors in several prominent, wealthy cloth-producing towns of Brabant and Flanders. The second one deals with the early-fourteenth-century debt organisation of a Cistercian abbey struggling with economic difficulties. This case reveals how the indebtedness of a private actor led to significant sales of annuities in various regions of the southern Low Countries.

All of these cases highlight a remarkably advanced degree of financial integration in this

early period.

Together these examples demonstrate the early development of financial

sophistication and integration, before the political unification of the Burgundian

4 Dukes. Circulation of credit instruments was far more widespread than the traditional

literature has maintained, and the circulators deployed sophisticated financial techniques

5 on a higher level than previously recognised. Our evidence suggests that Bruges was

3 Maristella Botticini, “A tale of ‘benevolent’ governments: Private credit markets, public finance and the role of Jewish lenders in medieval and renaissance Italy”, in 60, 2000, p. 164‑189. Journal of Economic History,

4 For the following period, the most recent studies are Jim L. Bolton & Francesco Guidi Bruscoli, “When did

Antwerp replace Bruges as the commercial and financial centre of north-western Europe? The evidence of the Borromei ledger for 1438”, in , 61, 2008, p. 360 ‑379, and Erik Aerts, “The stock exchange in medieval and Economic History Review early modern Europe. The origins of a concept in the southern Low Countries”, in Miscellanea in memoriam Pierre Cockshaw e e (1938‑2008). Aspects de la vie culturelle dans les Pays-Bas méridionaux (xiv ‑xviii siècle), ed. Frank Daelemans & Ann

Kelders, vol. 1 (Archives et Bibliothèques de Belgique, n° spécial 82), Brussels, 2009, p. 23‑46.

5 Herman Van der Wee, “The medieval and early modern origins of European banking”, in Banchi pubblici, banchi privati e monti di pietà nell’Europa preindustriale. Amministrazione, tecniche operative e ruolo economici, Atti del Convegno, 1‑6 ottobre Genova, ed. Dino Puncuh & Guiseppe Felloni, vol. 2 (Atti della società ligure di storia patria. Nuova Serie, vol. 31), Genova, 1991, p. 1158‑1173; John H. Munro, “The medieval origins of the financial revolution: Usury, rentes and negotiability”, in International History Review, 25, 2003, p. 505 ‑566.

Connecting Regional Capital Markets in the Late Medieval Low Countries not an exception. Early development of advanced techniques occurred throughout the southern Low Countries, well before their widespread use in the northern Low Countries.6

Interregional Circulation of Credit Instruments and the Medieval Political Economy

Circulating “Lombard Debt-Recognizances”: The Example of Guelders

This first case study deals with a typical issue of the medieval political economy: funding for a war. As Steven Epstein wrote, for the late Middle Ages, “the basic task of political economy is to explain how governments found the money to pay for war”.7 Our story begins in 1282 when Count Reginald I of Guelders (in Dutch, Reinoud or Reinald) (1271‑1326) borrowed 3,900 Leuven pounds from the Piedmontese banker Tadeo Cavazzone. In this period, many princes in the Low Countries, including the count of Guelders, were trying to construct homogeneous territories. Cavazzone benefited from a good relationship with the Duke of Brabant and the Count of Holland, in addition to his connection to the Count of Guelders. He was soon to become an important figure in the English wool trade within the Low Countries, in his role as an intermediary between a Lucchese wool merchant and princes such as Floris V of Holland and Duke John I of Brabant (1268‑1294) between 1284 and 1291.8 Reginald of Guelders needed to finance the expansion of his principality into the territory of Limburg. The count asserted that he was the sole legal prince in Limburg through his wife, Ermengarde, the last heiress of the Dukes of the house of the Limburg. He ran up against the ambitions of the Duke of Brabant who wanted to extend his authority over the same territory. The Duke had vowed to protect the interests of Brabantine merchants going to the Rhineland fairs; these merchants had to cross Limburg on their way to Cologne. Since the local feudal lords of the region were chronic brigands, merchants were frequently robbed, a severe impediment to Brabantine trade with the Rhineland. To advance their political goals, both princes launched diplomatic campaigns to win allies on their side, but after 1284, they engaged in open war against each other. To sustain the war effort, Reginald of Guelders faced a tough choice: he could levy new taxes on his subjects, towns, clergy and nobility. However, this entailed difficult negotiations with the representatives of these political groups, and he could be forced to grant the right to participate in the county’s government to delegates of these power groups, as

6 James M. Murray, Bruges, cradle of capitalism, 1280‑1390, Cambridge, 2005. 7 Steven A. Epstein, An economic and social history of later medieval Europe, 1000‑1500, Cambridge, 2009, p. 122. 8 Raymond Van Uytven, “De macht van het geld: financiers voor Floris V”, in Wi Florens… De Hollandse graaf Floris V in de samenleving van de dertiende eeuw, ed. Dick E.H. de Boer, Erich H.P. Cordfunke & Herbert Sarfatij, Utrecht, 1996, p. 212‑223, here 219‑220, and David Kusman, Usuriers publics et banquiers du Prince. Le rôle économique des financiers piémontais dans les villes du duché de Brabant (xiii e‑xiv e siècle) (Studies in European Urban History, 28), Turnhout, 2013, p. 101 and 107.

85 David Kusman & Jean-Luc Demeulemeester

Leuven pound 15 Holland pound Sterling marks(Köln?)

Number of menons Non-speciﬁed coins 10 Huissen pound Deventer pound Köln marks 5

0 Canonical chapter of Canonical chapter of Deaconry of Betuwe Provostship of Saint-Peter Deventer Zutphen of Utrecht (estates in Guelders) Church instuons taking part in the collecon Figure 1: Silver coins used in the levying of tithes in Guelders for the benefit of a collection in the bishopric of Utrecht in order to finance a crusade in the Holy Land (1276‑1281). Source: L.A.J.W. Sloet, Oorkondenboek der graafschappen Gelre en Zutfen, tot op den slag van Woeringen, 5 juni 1288, ’s-Gravenhage, 1872‑1876, n° 972 (1276‑1281), p. 941‑947. will eventually happen in Guelders at the beginning of the fourteenth century.9 A second option was to borrow money from foreign merchants on a short-term basis, and thus avoid bargaining and granting new political privileges to his subjects. At that time the capital market in Guelders lagged behind foreign capital markets, e.g. those in Flanders, the Rhineland and Brabant, because there were no Italian merchant- bankers established in Guelders, nor any domestic lenders with enough assets to venture into high finance. The dominant position of the Brabantine Leuven pound in a wide

variety of commercial transactions within the county was another sign of the immaturity

of the Guelders capital market. Massive flows of this pure, foreign silver money inundated

10 the towns and villages of Guelders after 1276 (see Fig. 1).

Reginald of Guelders chose the second option, borrowing from a foreign

merchant, Tadeo Cavazonne, who operated in the duchy of Brabant from the town of

’s-Hertogenbosch (see Map 1). His choice might have been influenced by one of his

counsellors, the lord of Cuijk, because the loan contract was finalised in the partially

autonomous seigneury of Grave, an enclave in the county of Guelders. John of Cuijk, the

er 9 David Kusman, “Asymétrie de l’information et crédit médiéval : les déboires financiers du comte Renaud I de e Gueldre avec le banquier astésan Tadeo Cavazzone à la fin du xiii siècle” in 12, , Jaarboek voor Middeleeuwse Geschiedenis,

2009, p. 76‑113, here 76‑79, for Guelders, see Remi van Schaïk, “Taxation, public finances and the state-making process in the late Middle Ages. The case of the duchy of Guelders”, in Journal of Medieval History, 19, 1993, p. 251‑271. See also more recently David Stasavage, Princeton 2011, on States of credit: Size, power and the development of European polities, , the effect of participation by lenders or tax-payers on the modernisation and institutionalisation of the audit and control procedures (which was a slow emergence of democratic control of public finances). 10 There is no evidence of an advanced capital market in Guelders during the thirteenth and fourteenth centuries in Van

Bavel, Manor and markets. The Leuven pound was even used for petty commercial transactions: Kusman, “Asymétrie de l’information”, p. 89 and n. 32.

Connecting Regional Capital Markets in the Late Medieval Low Countries

Map 1: Regional origin of the vassals of the Count of Guelders being pledges for its debts contracted with the Piedmontese banker Tadeo Cavazzone in 1282 on January 15 and April 5. Mapped is the county of Guelders and Zutphen, but with the divi- sion into four quarters as developed later in the fourteenth century (design: Rudolf A.A. Bosch, Meppel).

lord of Grave, had many connections with international merchants and some knowledge of commercial matters. His lordship in Grave on the Maas River ensured him a regular stream of revenue from a toll levied on trade between the Rhineland and the county of Holland. Cuijk was also politically tied to Duke John I of Brabant, who granted Cuijk annual feudal rents in ’s-Hertogenbosch.11 Tadeo Cavazzone asked for a fairly modest rate of interest for a short-term loan at that time (ten percent, included in the sum). However, he inserted a legal clause into the loan contract that he must be repaid ad voluntatem (at his pleasure), meaning that

11 Kusman, “Asymétrie de l’information”, p. 88, and Jacobus Albertus Coldeweij, De Heren van Kuyc, 1096‑1400 (Bijdragen tot de Geschiedenis van het Zuiden van Nederland, 50), Tilburg, 1981, p. 72 and 105.

87 David Kusman & Jean-Luc Demeulemeester the Lombard could claim payment of the entire debt at any time.12 This complicated the task of the prince and his receivers, because they could not plan their yearly expenses. The 10% interest rate reflected the low risk attached to the credit instrument, which makes it clear that the Italian banker could distinguish between borrowers who were more credit- worthy and those who carried higher risk, depending on the existence of reliable collateral. The count of Guelders pledged the lucrative tolls at Driel, Lobith and Zuilichem and guaranteed payment of the debt with his landed estates, among other conditions. The most productive toll, Lobith, alone paid an average yearly revenue of more than 3,000 Guelders pounds at the end of the thirteenth century.13 Therefore, if the count of Guelders decided to repay the loan of 3,900 Leuven pounds to his Lombard banker, he could have done so in two or three years at the most. Hoping to win the war, he thought it was wiser to postpone repaying his debt recognizances. However, in 1288, Reginald of Guelders lost the war at the battle of Worringen. He now faced the huge financial penalties imposed on him by the Treaty of Paris (15 October 1289), amounting to 10,200 silver marks, a weight of 1449.56kg in pure silver. Around 1290, the count defaulted on all his loans. Guy of Dampierre, count of Flanders (1278‑1305) and the father-in-law of the count of Guelders, purchased Reginald’s debt recognizances from the Piedmontese banker Tadeo Cavazzone in 1291. Guy of Dampierre agreed to pay the principal and interest, which amounted to no less than 10,000 pounds tournois. This huge sum was equivalent to one-fifth of the total public debt of Guelders at the time.14 The amount illustrates the financial weight of Cavazzone’s banking activities, which rank with the level of the paid taxes to the prince by the wealthy Flemish towns such as Bruges, Ghent or Lille.15 In 1291, Reginald had to surrender the government of Guelders to Guy of Dampierre, count of Flanders (1278‑1305). Reginald and his spouse were, as they explained to Guy of Dampierre, “pressed by merciless creditors”.

12 But the 10% interest rate was quite normal for a loan payable ad voluntatem, i.e. at the will of the creditor. See Carlos Wyffels, “L’usure en Flandre au xiiie siècle”, in Revue Belge de Philologie et d’Histoire, 69, 1991, p. 853‑871. A survey of the available data shows actually that interest rates on short-term loans during the second half of the thirteenth century were a little above the interest rate charged by Cavazzone: see Gérard Sivéry, L’économie du Royaume de France au siècle de Saint

Paris, 1984 p. 230, who cites yearly interest rates rising to as much as 30% for commercial loans during the Champagne Louis, , fairs in the first half of the thirteenth century. In Calais, the Arrageois financiers loaned money to the city with interest rates fluctuating from a low 14% (1255) to a high of 20% in periods of war (1297), according to Pierre Bougard & Carlos

e Wyffels, Les finances de Calais au xiii siècle (Pro Civitate, Collection Histoire, série in-8°, n° 8, 1966), Ghent, 1966, p. 48.

From 1252 onwards, in the kingdom of France, interest rates declined to 11.6%. In England and the Low Countries, the cost of capital for short-term loans fluctuated between 12.5% and 16% (Bruges): Stephan R. Epstein, Freedom and growth. The

rise of states and markets in Europe, 1300‑1750, London-New York, 2000, p. 21‑23.

13 Lodewijk Samuel Meihuizen, De rekening betreffende het graafschap Gelre, 1294‑1295 (Vereeniging tot beoefening van Geldersche geschiedenis, oudheidkunde en recht, 26), Arnhem 1953, p. 63, 75, and 166; Gerard Nijsten, In the

shadow of Burgundy. The court of Guelders in the late Middle Ages, Cambridge, 2004, p. 91. Around the middle of the fifteenth century, assignment of the Lobith toll was still favored by the Guelders financial administration to reimburse the

Duke of Guelders’ creditors, see Rudolf A.A. Bosch, “De zaak Henric Haeck. Een case-study naar de politieke, sociale en

financieel-economische aspecten van kredietrelaties tussen het hertogdom Gelre en het Duitse Nederrijngebied, 1450‑1550”, in Stedelijk verleden in veelvoud. Opstellen over laatmiddeleeuwse stadsgeschiedenis in de Nederlanden voor Dick de Boer, ed.

Hanno Brand, Jeroen Benders & Renée Nip, Hilversum, 2011, p. 89‑103, here 97.

14 This estimate is based on Richard Knipping, Die Regesten der Erzbischöfe von Köln, vol. 3/2, 1261‑1304, Bonn, 1913, n° 3633, p. 248, and Jules De Saint Genois, Inventaire analytique des chartes des comtes de Flandre, Ghent, 1843‑1846, n°1006‑1007, p. 292‑293 [ 1298]). The pledge amount was 75,000 lb. tourn. or 60,000 lb. parisis (cf. Meihuizen, c. De rekening, p. 21).

15 While Bruges paid the Count of Flanders 30,000 pounds in two yearly installments in 1295, Ghent was granted the right to levy taxes on trade in the city for ten years in exchange for 25,000 pounds tournois. And finally, Lille paid a mere

5,000 pounds tournois to the Count in 1295 to purchase the right to levy taxes on all commercial transactions (Kusman, “Asymétrie de l’information”, p. 91 and n. 40, with reference to the older literature and archival evidence).

Connecting Regional Capital Markets in the Late Medieval Low Countries

The count of Flanders took over the entire debt burden and reimbursed Cavazzone two years later.16 In return, he received the power to appoint Flemish officials to examine the revenues of the Guelders domain and to exercise guardianship over the principality for five years. The main debt recognizances held by Cavazonne could be paid either to him or to his agent (ad suam voluntatem vel sui certi nuncii ad hoc per presentes literas deputati solvendarum), which implied that the credit titles were partially transferable, even though the bearer clauses did not necessarily make the documents truly negotiable credit instruments.17 These credit instruments listed the amount owed, the legal conditions of the payment and the description of the securities required by the lender. They are still in the Flemish comital archives today, which means that the count of Guelders did not reimburse his father-in-law, who left them in the Flemish chancery without any notation of cancellation.18 Guelders was not an isolated example of the use of financial tools to facilitate the political control of one state by another, wealthier state. Similar interregional circulation of credit instruments occurred in the bishopric of Liège in the 1280s. In 1284, John (called both John of Flanders and John of Dampierre), the son of Guy of Dampierre, and elected bishop of Liège, pledged to his father the towns or villages of Fosses, Marbaix, Gosée, Espierres and Jambes in exchange for Guy’s financial pledge of surety as next-of-kin to John’s Tuscan and Piedmontese creditors. John’s sureties were his father Guy of Dampierre and his brother Robert of Béthune, who sent to the bishopric of Liège the same Flemish officials who were already in Guelders as guardians and managers of the accounts. They were to help the indebted bishop manage his estates.19 Between 1280 and 1284, in exactly the same period as the Guelders incident, the bishop accumulated debts to two Douai burghers and four Florentine and Siennese merchant-banker companies for at least 30,000 pounds tournois, which at that time equalled two-and-one-half years of revenue for the bishop of Liège. The count of Flanders, Guy of Dampierre, bought up all these debt

16 State Archives Ghent (hereafter SAG), Charters of Flanders, Fonds Saint-Genois, n° 658 (dated 26 December 1293). One can only wonder why the Duke of Brabant did not take similar action. It is likely that Cavazzone weighed the risks associated with the questionable trustworthiness of the Duke of Brabant against the credibility of the Count of Flanders and privileged the latter. The Duke of Brabant would later make use of the same strategy of purchasing debts from the Lombards as a means to acquire political control in the lordship of Heusden, north of the Brabantine border with Holland, around 1326‑1330. John V, Lord of Heusden, whose seigneury, located north of ’s-Hertogenbosch was disputed between the Count of Holland and the Duke of Brabant, had contracted numerous loans from Lombard banks from Brussels, Mechelen, ’s-Hertogenbosch and Valenciennes. Ultimately, these debt contracts from the Lord of Heusden and his pledges were purchased by the Duke of Brabant and his officials so that they could seize the Lordship of Heusden from the lord as his new creditors when he defaulted on his loans (Kusman, Usuriers publics, p. 201‑227). 17 John H. Munro, “English ‘backwardness’ and financial innovations in commerce with the Low Countries, 14th to 16th Centuries”, in International trade in the Low Countries (14th-16th Centuries), ed. Peter Stabel, Bruno Blondé & Anke Greve (Studies in urban social, economic and political history of the medieval and modern Low Countries, 10), Leuven- Apeldoorn, 2000, p. 105‑167, here 133‑137. See the legal clause inserted in the charter: SAG, Charters of Flanders, Fonds Gaillard, n° 765, a loan of 3,000 Leuven pounds (dated 5 April 1282). We are inclined to follow Des Marez’s interpretation that the letter of obligation with a bearer clause – whatever the legal formula used – allowed the creditor to transfer his rights to a third person: “Par la transmission conventionnelle de la lettre, s’opère la transmission du droit”: Guillaume Des Marez, La lettre de foire à Ypres au xiii e siècle. Contribution à l’étude des papiers de crédit (Mémoires couronnés et autres Mémoires publiés par l’Académie royale de Belgique, collection in -8°, 60), Brussels, 1901, p. 37. See another example of a debt recognizance with a bearer clause from Flemish comital archives, in which Reginald of Guelders was indebted to horse merchants from Prato, dated from October 1287 in Des Marez, La lettre de foire à Ypres, p. 220‑221, pièces justificatives, n°127 (SAG, Fonds Saint-Genois, n° 451). 18 That would have meant that the debt was paid back. Otherwise, in most of the cases, when the creditor was paid, he handed over the debt recognizance to the debtor who destroyed it. 19 Alain Marchandisse, “Un prince en faillite. Jean de Flandre, évêque de Metz (1279/80‑1282), puis de Liège (1282‑1291)”, in Bulletin de la Commission Royale d’Histoire, 163, 1997, p. 1‑75.

89 David Kusman & Jean-Luc Demeulemeester recognizances.20 Guy and his son, Robert of Bethune, also made loans from their own capital to the bishop. Some of the loan contracts were even moulded in precisely the same diplomatic form as that of the Cavazonne loans. They were designed as ad voluntatem refundable contract loans (to be repaid at the creditor’s will) and sometimes included a bearer clause.21 This is striking evidence of cultural and technological exchanges between the Flemish court and the Arrageois and northern Italian bankers. In the end, all debt recognizances remained in the comital archives of Flanders because the bishop was clearly unable to fulfil his obligations to his father before he died in 1291.22 In these transactions, the key strategic role of legal advisers from the court of Guy of Dampierre has to be stressed.23

A Politico-Economic Perspective

To sum up this first section, Lombard credit titles were used to achieve political domination. Obviously, transferable credit instruments were quite useful financial tools for political actors who wanted to bring about insolvency. Lombard loans were de facto long- term investments (usually not repaid before ten years had passed) disguised as short-term loans. For the exercise of power, consolidated debts were more effective than classic short- term loans. In contrast to Stasavage’s claim, this is clearly the early emergence of public debt in a political unit larger than a city-state (Guelders).24 The need to finance wars and the building of long-term public debt were closely linked. While the count of Guelders had to finance the Limburg campaign, the bishop of Liège paid heavy costs to provide foot soldiers for the Duke of Brabant’s army at the battle of Worringen (1288) which led to the Duke’s conquest of the County of Limburg.25 The circulation of credit instruments depended on the key role of intermediaries. They had free access to strategic, commercial and political information at the princely courts of Guelders, Liège and Flanders. These informal middlemen were chancery clerks, chaplains, Italian bankers and, last but not least, counsellors from the high nobility.26

Nobles, such as John of Cuyck, lord of Grave, took advantage of their feudal connections

20 Marchandisse, “Un prince en faillite”, p. 26‑27.

21 Ibidem, see n° 2, 21, 22 (bearer clause included), 24, 25 (bearer clause) and 27 and Meihuizen, De rekening, bijlage II, p. 119.

22 Marchandisse, “Un prince en faillite”, p. 27.

e e 23 John Gilissen, “Les légistes en Flandre aux xiii et xiv siècles”, in Bulletin de la Commission Royale pour la publication des Anciennes Lois et Ordonnances de Belgique, 15/3, 1939, p. 117‑231 and John Gilissen, “L’apparition des renonciations e aux exceptions de droit romain dans le droit flamand au xiii siècle”, in , 19, 1951, p. 513‑550. Revue d’histoire du droit

24 Stasavage, States of credit, p. 30‑34, tends to believe that long-term public debts were first developed in the Italian city-states.

25 Marchandisse, “Un prince en faillite”, p. 13.

26 Kusman, “Asymétrie de l’information”, p. 93: for instance, among the Flemish officials managing the Guelders public debt of 60,000 pounds there was a chaplain who since 1286 had been in service to Margaret, the spouse of Reginald of

Guelders and daughter of Guy of Dampierre. Also present was another Flemish functionary who had previously been the

local bailiff in Kortrijk, a city where prominent Piedmontese moneylenders resided and the city itself had business ties to

Cavazzone. In the case of Liège, we can identify among the intermediaries delivering sums to the bishop on behalf of the Count of Flanders Gerardo Lupicini, a Florentine banker and comital receiver (1289‑1292) and Gérard de Ferlin, a Flemish clerk, secretary of the bishop first and then to the Count of Flanders (see Marchandisse, “Un prince en faillite”, p. 24‑25, who gives numerous examples of intermediaries).

Connecting Regional Capital Markets in the Late Medieval Low Countries with multiple territorial lords in the late medieval Low Countries to broker commercial and political information.27 The following section analyses the collaboration of Piedmontese financiers and urban money-changers to manage public debt. This collaboration depended on use of advanced banking techniques which allowed the lending of capital deposited in the public exchange for private credit ventures.

Private Credit, Public Finances and Advanced Financial Techniques in Brabant, Hainaut and Flanders, c. 1311‑1350

In this section, we will first elucidate the precocious sophistication of financial techniques in Brabant which enabled links between private credit and public finance. Afterwards we will show how private actors pursuing their own strategic interests mobilised these techniques and credit instruments at the expense of others. One result of this mobilisation was a deeper capital market connection among the different regions of the southern Low Countries because of the increased circulation of reliable information along with credit titles.

Financial Innovations in Brabant

Full appreciation of the pioneering role of Piedmontese moneylenders in the dissemination of banking techniques and circulation of credit instruments comes from examining the map tracing the rapid extension of their interregional banking networks after the end of the thirteenth century (see Map 2). In a number of mercantile towns, specifically Dordrecht, Mechelen, and ’s-Hertogenbosch, from the 1280s, Piedmontese bankers exchanged technical information with local elites because they both used the town exchange, or wissel in medieval Dutch. In this institution, municipal money-changers accepted deposits, bought and sold annuities and performed banking functions such as transferring funds from one account to another, for private and public accounts.28 This institutional framework encouraged the town receivers to adopt new financial techniques for accounting, as the Mechelen accounts show. The evidence demonstrates that in populous Brabantine cities, a private credit market was interacting with a public – and somewhat more anonymous – credit market, city finances and life- annuities sales. The mechanisms were quite simple: citizens most frequently invested capital by transferring their yearly life annuity payment to the account of Piedmontese bankers. These Lombard bankers were active in nearly every Brabantine town. At their peak in 1309, they maintained forty-two banking establishments. Moreover, relying on a vast network of financial agents in big cities, such as Brussels, Ghent, Mechelen and ’s-Hertogenbosch, Piedmontese bankers circulated crucial information to potential

27 Kusman, “Asymétrie de l’information”, p. 87‑88 and 98: this lord benefited from his simultaneous feudal connections with the Count of Guelders, the Count of Flanders, the Count of Holland and the Duke of Brabant. 28 The last thorough examination of this topic is by Erik Aerts, “The absence of public exchange banks in medieval and early modern Flanders and Brabant (1400‑1800): a historical anomaly to be explained”, in Financial History Review, 17, 2010, p. 1‑27.

91 David Kusman & Jean-Luc Demeulemeester

Map 2: Supraregional Piedmontese credit networks around 1292. Map adapted from the map of the Low Countries c. 1300 in Malcolm Vale, The princely court: medieval courts and culture in North-West Europe, 1270‑1380, Oxford, 2001, map 2. Map design: Marcel Bastin. Conception: David Kusman.

investors in foreign (i.e. outside of their own city) annuity markets.29As this section will show, most of the investors belonged to the upper strata of urban medieval society and a few rich aristocratic families.

Financial innovations were not exceptional in medieval Brabant between roughly the end of the thirteenth century and the first quarter of the fourteenth century. Local

bankers and established moneylenders, as well as town hospital offering fresh credit

contributed to the growth of credit activities. Private deposit banking existed as early as

30 1282 (see Map 3). The towns of ’s-Hertogenbosch and Mechelen were at the forefront

of these technological innovations, although the same innovation probably occurred in

29 Population estimates of these cities around the middle of the fourteenth century, although difficult to establish, should be higher than a century later: Brussels, around 30,000, Ghent, around 60,000, Mechelen, around 22,000 and

’s‑Hertogenbosch, around 14,000 (Paul Klep, “Population estimates of Belgium, by province (1375‑1831)” in Historiens et

Populations. Liber Amicorum Étienne Hélin, Louvain-la-Neuve, 1991, p. 485‑507, here 495, and Peter Stabel, Dwarfs among giants. The Flemish urban network in the late Middle Ages, Leuven-Apeldoorn, 1997, p. 31‑43. On annuity markets, see Marc

Boone, Karel Davids & Paul Janssens (ed.), Urban public debts. Urban government and the market for annuities in Western

Europe (14th-18th centuries) (Studies in European Urban History, 3), Turnhout, 2003. On the number of Lombard banks in the early-fourteenth century Brabant, see Kusman, Usuriers publics, p. 2, 246 and 392. e e 30 David Kusman, “Les hôpitaux et le crédit dans le duché de Brabant (xiii ‑xv siècles)”, in Institutions de l’assistance sociale en Lotharingie médiévale. Actes des 13es Journées Lotharingiennes, 12 octobre-15 octobre 2004, Luxembourg, ed. Michel

Pauly (Publications de l’Institut Historique Grand-Ducal de Luxembourg, 118), Luxembourg, 2008, p. 355‑384; David Kusman, “Crédit médiéval et villes périphériques: le cas du duché de Brabant durant le xiiie siècle”, in Villes et villages: organisation et représentation de l’espace. Mélanges offerts à Jean-Marie Duvosquel à l’occasion de son soixante-cinquième anniversaire, ed. Alain Dierkens et al. (Revue Belge de Philologie et d’Histoire, 89), Brussels, 2011, p. 423‑438.

Connecting Regional Capital Markets in the Late Medieval Low Countries

Map. 3: Financial innovations in Brabant (1282‑1314).

Brussels.31 The commercial weight of cities such as Leuven or Antwerp which hosted prominent foreign merchant communities, the most important of which between 1296 and 1315 were the Genoese, Tuscan, English and Hanseatic merchants, should not be underestimated.32 The financial markets of these cities depended on money-changers who had some knowledge in deposit banking, but the precocious development of the most dynamic techniques took place in ’s-Hertogenbosch and Mechelen. The following in-depth analysis of the banking customs and institutional framework of the Mechelen town exchange illustrates the transfers of techniques from the private banking sector to the public financial sector.

31 If many of the town accounts had not been destroyed in the bombing of Brussels in 1695 by the French troops, today we would have a much more complete picture of the financial history of Brabant; see, for example: Arlette Smolar-Meynart, “Les répercussions accidentelles du bombardement sur le climat politique local. De la diffusion d’archives secrètes au réveil de la contestation”, in Autour du bombardement de Bruxelles de 1695. Désastre et relèvement, ed. Arlette Smolar-Meynart (Bulletin du Crédit Communal, n° 199), Brussels, 1997, p. 81‑93, here 81. 32 Jean de Sturler, Les relations politiques et les échanges commerciaux entre le duché de Brabant et l’Angleterre au Moyen Âge. L’étape des laines anglaises en Brabant et les origines du développement du port d’Anvers, Paris, 1936, p. 212‑218 for Antwerp, and Kusman, Usuriers publics, p. 156‑158, for Leuven.

93 David Kusman & Jean-Luc Demeulemeester

Financing the Urban Public Debt in Mechelen and Technological Exchanges with the Private Credit Sector

During the first half of the fourteenth century, Mechelen was a densely populated commercial city (of about 22,000 inhabitants) producing goods for long-distance export, such as wool cloth to England, and serving as an interregional hub market for wine, beer and salt. Mechelen was undoubtedly a rich city in a healthy financial state at the beginning of the century. The city government took in annual receipts of 37,262 pounds payment to match its expenses of 37,243 pounds payment (1311).33 In 1311, the city was even in a position to make a huge payment to Lucchese creditors on behalf of the Duke of Brabant Jan II (1294‑1312).34 However, the city’s prosperity was contingent on favourable general economic conditions and political changes affecting the late medieval Low Countries. These conditions could disrupt its trade relationship, as happened between 1311 and 1318, when the Duke of Brabant found it difficult to make payments on his huge debts, which led to the seizure of Mechelen merchants’ goods at the Champagne fairs. The town also had to cope with public debt, consisting mainly of life-annuities that were sold to burghers as far away as Reims. Payments on the life-annuities amounted to an average 68.4% of the city’s annual expenses between 1311 and 1335.35 The heavy involvement of Mechelen in foreign textile markets, in Avignon, at the Champagne fairs, in England, in Savoy and especially in northern Italy, and the need to know if its foreign life annuity holders were still alive made one thing vital: access to reliable commercial information.36 This entailed the existence of financial intermediaries and a sophisticated bookkeeping system, so that the receivers would be well informed about economic developments outside of Brabant (devaluations, bullion famine, commercial wars, minting of new coins, seizure of goods abroad, etc.) and could react accordingly. In this respect, the Piedmontese financiers were important actors in the commercial sphere of the city. Nowhere else in Brabant can we observe with such accuracy the transfer of technological exchanges from the private credit sector to the public financial sector.37 The techniques used in Mechelen were innovative in three ways (see Table 1).

First, the life-annuities deposited in the town exchange were also used as current accounts

to perform various types of payments, a useful function that has been relatively neglected

33 Jean-Paul Peeters, “Het ontstaan van de stadsfinanciën te Mechelen tijdens de middeleeuwen in het perspectief van

de redactie der oudst bekende stadsrekening (1311‑1312)”, in Handelingen van de Koninklijke Kring voor Oudheidkunde,

Letteren en Kunst van Mechelen (hereafter HKKOLKM), 85, 1981, p. 23‑70, here 57‑59.

34 From an original ducal assignment of 41,000 pounds on the city of Mechelen made in 1311 to the Onesti merchant-

banker company, the city was able to pay 17,496 pounds payment before 1317 (Stadsarchief Mechelen (SM), town account n° 2 (1313‑1314), fol. 1r° and 110v°; town account n° 3 (1315 ‑1316), fol. 1v°, 76r° and 84v°; town account n° 4 (1317‑1318), fol. 10v°.

35 The most comprehensive analysis of the economic conditions prevailing in the city is given by Jean-Paul Peeters, “Het financieel-economisch profiel van de stad Mechelen tijdens de eerste decennia der 14de eeuw (1311‑1336)”, in HKKOLKM,

97, 1993, p. 55‑122, here 66‑67, 112‑113, and 119‑120.

36 Karl Heinrich Schäfer, Die Ausgaben der apostolischen Kammer unter Johann XXII nebst den Jahresbilanzen von

1316‑1375 (Vatikanische Quellen zur Päpstlichen Hof- und Finanzverwaltung, 1316‑1378, 1), Paderborn, 1911, p. 208‑210,

215, 231 and 235‑237; de Sturler, p. 482‑491; David Kusman, “Mariage et réseaux financiers Les relations politiques, e internationaux à la fin du xiii siècle. La pesanteur des alliances féodales face à la déloyauté des marchés”, in Francia, 32, 2005, p. 121‑156; Franco Morenzoni, “Le mouvement commercial au péage de Saint-Maurice d’Agaune à la fin du Moyen Âge (1281‑1450)”, in Revue historique, 289, 1993, p. 3‑63, here 22.

37 For the commercial and politic integration of Mechelen in Brabant during the years 1300 see the classic article of Piet Avonds, “Mechelen en de Brabantse steden (1312‑1355)”, in Bijdragen tot de Geschiedenis, 53, 1970, p. 17‑80.

Connecting Regional Capital Markets in the Late Medieval Low Countries

Table 1: The life annuity as a current account (examples of orders to the moneychanger).

Life-annuity Action (happens through Beneficiary of the action owner intermediation of moneychanger)

X1 Op iemand vergouden => implies book Lombards of Mechelen: may be used transfer : credit operations, purchases, debt for loans, merchants, creditors, etc. payment, etc. X2 Op hemzelf Ghescreven => no book transfer X3 Op iemand vergouden => implies book Wouter Bau, town moneychanger: may transfer be used for loans Jan Blankart, broker-hosteller working with Piedmontese financiers in recent studies of life-annuities.38 Sometimes, the annuity owner wanted to keep it on his own account. Mechelen magistrates made the most use of this strategy. For instance, the Alderman Jan de Calcovene used the expression op hem selven ghescreven, “written on himself ”, meaning on his own account.39 Secondly, the life-annuities could be invested in banking operations by the town moneychangers who kept them in custody. Life-annuities could also be transferred to third parties. Finally, the clerks used sophisticated bookkeeping techniques (using in some entries a form of bilateral accounts) influenced by banking practices. The critical factor was the cultural and technological exchanges among town moneychangers, local brokers-hostellers and Piedmontese moneylenders.40 In 1311, the city of Mechelen had no less than eight money-changers, including a woman, Lady Avezoete van den Vliete.41 This pattern of women’s participation in money-changing was typical of progressive financial systems, such as in the city of Bruges or, to a lesser extent, Ghent.42 In Mechelen, and Brussels as well, life-annuities43 were paid by money-changers, who kept accurate books and thus knew which life annuity owners were deceased.44 Moreover, life- annuities served as a basis of financial relations between towns (see Figure 2). In Mechelen, in the early fourteenth century, approximately fifty percent of the life annuity market was

38 There is no mention of this financial custom in Boone, Davids & Janssens (ed.), Urban public debts, and C.Jaco Zuijderduijn, Medieval capital markets. Markets for renten, state formation and private investment in Holland (1300‑1550) (Global Economic History Series, 2), Leiden, 2009. 39 SM, town account n° 4 (1317‑1318), fol. 79r°. 40 Murray, Bruges, p. 148‑177. 41 SM, town account n° 1 (1311‑1312), fol. 150r° and 201r°. 42 Murray, Bruges, p. 309‑310 and Shennan Hutton, Women and economic activities in late medieval Ghent, New York, 2011, p. 6 and 86. 43 For more on this system, see Wim Blockmans, “Financiers italiens et flamands aux xiiie‑xive siècles”, in Aspetti della vita economica medievale. Atti del Convegno di Studi nel X Anniversario della morte di Federigo Melis. Firenze-Pisa-Prato, 10‑14 marzo 1984, Florence, 1985, p. 192‑214, here 209‑210. For Brussels, see Claire Dickstein-Bernard, La gestion financière d’une capitale à ses débuts: Bruxelles, 1334‑1467 (Annales de la Société Royale d’Archéologie de Bruxelles, 54), Brussels, 1977, p. 194‑195 and 310‑314; for Leuven, see Raymond Van Uytven, Stadsfinanciën en stadsekonomie te Leuven van de XIIe tot het einde der XVIe eeuw (Verhandelingen van de Vlaamse Academie voor Wetenschappen, Letteren en Schone Kunsten van België, Klasse der Letteren, 44), Brussels, 1961, p. 38. 44 For a life annuity contracted by the father for his minor children in 1317: “scriptum in libro”: SM, n° 4, fol. 79r°. In 1342‑1343, drafts of these books were integrated into the town accounts with a list of every life annuity buyer, amounts and the total sum of the sold annuities: “Wouter de wisselere heeft hier van onser portren liftochten van inghaende merte tote ingaende aprille”, see: SM, town account n° 22 (1342‑1343), fol. 121r°.

95 David Kusman & Jean-Luc Demeulemeester

Local life-annuity purchasers

Book transfers orders

Town Exchange of Mechelen Local moneychangers Lombards

Jacob Vissenbarde Jan Criecsteen Wouter Bau Lombard bank of Mechelen : Jan Jan van Berchem Book transfers van Halen alias Giovanni de Hendrik van Scollant Mirabello and Aubertino de Hendrick den Joede Montemagno

Sale of life-annuities

Book transfers orders The missing link: broker-hostellers Town Exchange of Brussels Buying (and selling) of life-annuities as intermediaries Local moneychangers between private investors and Janne Crupelande Janne van den Hane moneychangers as in Bruges.

Book transfer orders

Life-annuity purchasers from Brussels

Figure 2: Current accounts, book transfers and life annuities in Mechelen c. 1311‑1314. in the hands of rich citizens from Brussels.45 This explains why two moneychangers of Brussels, Janne Crupelande and Janne van den Hane, were so active in this capital market. They collected the majority of the annual interest payments on these life-annuities and then disbursed the funds to the burghers of Brussels from their exchange offices.46 The Lombard banker was another key actor. He had his own account in the town exchange. Early evidence of this practice appears in the town accounts of Dordrecht for 1284‑1286. Bertelmeuse den Lombard acted as intermediary and beneficiary for payments 47 between the city of Dordrecht and the count of Holland, as well as for private persons.

Other significant figures were the brokers-hostellers. The Mechelen municipal

magistrates had their own hosteller in Brussels to facilitate their transactions with the

48 money-changers of Brussels, and the reverse was undoubtedly true. Although there is no

archival evidence documenting the relationships between brokers-hostellers and money-

changers as exists for Bruges, we can nevertheless assume their existence.

45 Estimates made on the basis of the first Mechelen register of annuity buyers, written for the years 1302‑1309: SM,

Rentes, K. SI Safe I, n° 1, fol. 1r°-11 r° (65 annuities out of a total of 133); the remaining annuities were bought by burghers

of Ghent and Valenciennes. A random sampling was thereafter carried out in the following town accounts: SM, n° 1

(1311‑1312), fol. 121v°-122v°; n° 2 (1313‑1314), fol. 1r° and n° 7 (1320‑1321), fol. 66 r°-67r°.

46 Kusman, , p. 280‑283. Usuriers publics

47 Jan Burgers & Eef Dijkhof (ed.), De oudste stadsrekeningen van Dordrecht, 1283‑1287 (Apparaat voor de geschiedenis van Holland, 11), Hilversum, 1995, p. 11, 14, 20, and 32. The growing importance of the city as regional centre for trade in wood, grain, salt and wine in the thirteenth century implied that foreign merchants could rely on the services

offered by money-changers and brokers: Jessica Dijkman, Shaping medieval markets. The organization of commodity markets in Holland, c. 1200-c. 1450 (Global Economic History Series, 8), Leiden-Boston, 2011, p. 161‑172. 48 SM, town account n° 2 (1313‑1314), fol. 56v°: “Janne van den Hane van vele partien die hi ons leende ane Janne van Belleghem onsen wert te Brusele die onse liede daer vertert hadden die Gheerart van den Eechove ende Gherart van Hoffstaden daer rekenden”.

Connecting Regional Capital Markets in the Late Medieval Low Countries

Map 4: The importance of the Piemontese merchant-banker network in the Low Countries, 1309‑1350, for loans to the high nobility and abbeys. Remark: the number of Piedmontese bankers was estimated on the basis of the prosopo- graphical work of Winfried Reichert, Lombarden in der Germania-Romana. Atlas und Dokumentation (Beiträge zur Landes- und Kulturgeschichte, 2), Trier, 2003, vol. 1, p. 307‑308, 344‑345, 370‑376 and vol. 2, p. 485‑498, 759‑762 and Kusman, Financiers du Prince, vol. 4, p. 1‑39.

The public notaries who worked for the Piedmontese banking societies were the final important link between public finance and private credit. In Mechelen, they often certified private deeds and worked as clerks for the city chancery at the same time. This double occupation gave them access to commercial and political information that they circulated to the benefit of the Piedmontese bankers. They combined knowledge of Roman law with some financial expertise, as in the case of the city clerk Jan van Waerloes, who was responsible for drafting and writing annuity titles for the city in 1317, on behalf of the Brussels moneychanger Jan van den Hane. Van Waerloes also worked regularly for the Piedmontese bankers. Their access to multiple financial environments made notaries vital public intermediaries in the spread of juridical practices and financial techniques. Their importance to the Mechelen Piedmontese bank cannot be overestimated (see Map 4).49 Finally, several embryonic elements of bilateral bookkeeping appeared in the city accounts, through the intermediation of the Piedmontese financiers. These new accounting techniques were particularly useful for making transfer orders. The first account entries employing these techniques (in 1311) were related to the wissel, the accounting record of all the debit and credit entries from exchanges between the eight town money-changers and the city financial administration. More precisely, the wissel contained entries of all receipts, such as loans from the local Piedmontese bankers, and expenses, such as delayed

49 Kusman, Usuriers publics, p. 305‑306.

97 David Kusman & Jean-Luc Demeulemeester

Table 2: Example of bilateral presentation in the town accounts of Mechelen with reference to a sum of 25 lb. payment as debit and credit entries cancelled in the wissel (exchange) part of the town account of 1311, fol. 42v°.

Left Vergouden ane Janne van Halen, Right -Ver Aliten si wi sculdech van hare saterdaghes veertiennacht voer Sinte lijftochte van Sinte Jans messe------Peters dach, ingaende oeste-----xiiii lb. xxv lb. payment x s. payment Item ane Olivere------x lb. x. s. payment

payments to the excise tax-farmers, for the city. Debit entries were written on the left side and credit entries on the right (see Table 2).50 This gave the town receivers a clearer view of the balance of payments between the city and its debtors and creditors. This increased clarity likely explains why the excise section was the other part of the accounts which shows early development (from 1321 on).51 Excise taxes were key resources for city incomes, as they brought in 70‑85% in the large cities of the southern Low Countries.52 These technical accounting innovations and frequent exchanges of financial practices between Piedmontese moneylenders and the local money-changers and broker-hostellers enabled wider circulation of information and credit titles. Circulation of credit titles enlarged the profit opportunities available to the rich rentier class and cloth merchants with surpluses of capital to invest. The following case of an indebted Cistercian abbey, Vaucelles Abbey in Hainaut, perfectly illustrates the broader interregional network of capital markets, as well as highly sophisticated credit instruments and their use to promote profit-driven interests.

Vaucelles, Where Private Credit Meets Public Finances

Around 1315, the Cistercian abbey of Vaucelles (see Map 4), located in the bishopric of

Cambrai, was faced with large expenses. First civil war had taken its toll. Breaking out in the

53 region of Cambrai in 1311, civil war had affected the rural land held by the abbey. Poor

grain harvests from 1315‑1317 aggravated the abbey’s losses. High transaction costs in the

trade of goods must also have played a role. Although there is no wide agreement on the

50 On this classic disposition, see: Peeters, “Het ontstaan”, p. 61, and for the technical difference with the double entry bookkeeping, for which all entries of the account must be recorded in this fashion, see Frederic C. Lane, “Double entry bookkeeping and resident merchants” in 6, 1977, p. 177‑191, here 181. Table 2 , Journal of European Economic History, illustrates an example in which a life annuity paying 25 lb. payment annually to Lady Aliten Winters is loaned to reimburse two creditors of the city, the Piedmontese banker Jan van Halen and the money-changer Oliver.

51 SM, town account n° 7 (1320‑1321), fol. 52r°.

52 See the contributions of Marc Boone, “Systèmes fiscaux dans les principauté à forte urbanisation des Pays-Bas méridionaux (Flandre, Brabant, Hainaut, Pays de Liège) au Bas Moyen Âge”, and Claire Billen, “À la recherche d’un e e prélèvement fiscal équitable. Pratiques, discours et porte-parole, dans les Pays-Bas méridionaux (xiii ‑xiv siècles)”, in La fiscalità nell’ economia europea secc. XIII-XVIII. Fiscal systems in the European economy from the 13th to the 18th centuries, ed.

Simonetta Cavaciocchi (Fondazione Instituto Internazionale di storia economica “F. Datini”, Prato, Serie II – Atti delle “Settimane di studi” e altri convegni, 39), Florence, 2008, p. 657 ‑683 respectively 871‑880.

53 Stéphane Lebecq, Le domaine de l’abbaye cistercienne de Vaucelles au Moyen Âge, Unpublished Mémoire du diplôme d’Etudes Supérieures, Université de Lille, Faculté des Lettres et Sciences Humaines, 1966, p. 127‑128.

Connecting Regional Capital Markets in the Late Medieval Low Countries ratio of transport expenses to total transaction costs, it is clear that overland transport costs for bulky goods such as grain remained high in comparison to water transport, because of the many taxes levied by local feudal lords and princes. During a period of famine, such as the years 1315‑1317, with many rains in summer, flooding streams and muddy roads, the side effects of abrupt climate change on grain transportation could prove disastrous for an abbey with scattered rural holdings.54 To make their acute problems worse, the abbey simultaneously struggled with a decline in the number of lay brothers, the ones responsible for actually working on the granges, which forced the abbot to hire salaried workers on the spot.55 To deal with the crisis, the abbot decided to borrow a total (principal and interest) of around 10,000 lb. petit tournois from the Mechelen- and Valenciennes-based de Mirabello-de Crusiglio Lombard banks at the beginning of 1315.56 The loan was probably made on a short-term basis, i.e. between six and eight months. One year later, the bishop of Cambrai, Pierre de Levis-Mirepoix, offered to redeem this huge debt owed to the Piedmontese moneylenders on behalf of the abbot of Vaucelles. In exchange for redeeming the “Lombard” debt that he could now transfer to third parties, the bishop proposed that the abbot sell him the abbey’s large estate of Ribeaucourt (300 hectares in area), located in the hinterland of Cambrai. A legal sales contract between the abbot and the bishop was therefore written down by a public notary.57 Despite the conclusion of this agreement and the fact that the bishop now possessed the sealed debt recognizances of the abbot to the Piedmontese banker Giovanni de Mirabello and his associates, the bishop never paid back the principal or the interest payments, causing an downward spiral of indebtedness for the Cistercian abbey. A 1317 intermediary account of financial expenses stated that the abbey still owed the Lombards 737 lb. 3 s. 4 d. in gros tournois (around 11,972 lb. petit tournois) on the principal, and 934 lb. 10 s. gr. tournois in interest (14,944 lb. tournois).58 In 1330, the total debt of Vaucelles amounted to no less than 20,000 lb. parisis or 25,000 lb. tournois in interest alone, scrupulously computed by the Lombards, year after year.59 This huge sum equalled nearly a year’s worth of annual receipts for the count of Flanders at that time.60

54 Philippe Contamine et al., L’économie médiévale, Paris, 19972, p. 237; John Hatcher & Mark Bailey, Modelling the Middle Ages. The history and theory of England’s economic development, Oxford, 2001, p. 155; and Epstein, An economic and social history (as footnote 7), p. 160‑163. 55 Lebecq, Le domaine, p. 130. 56 Georges Bigwood, Le régime juridique et économique du commerce de l’argent dans la Belgique du Moyen Âge (Mémoires de l’Académie Royale de Belgique, Classe des Lettres et des Sciences Morales et Politiques, collection in-8°, 2e série, 2/14), vol. 2, Brussels, 1922, n° 35, p. 330‑331 (edition of a charter dated 24 March 1321 recalling a first loan contract concluded in 1315); Archives Départementales du Nord, Lille (hereafter ADN), 28H/81, n° 1446 (25/8/1317); n° 1452 (c. 1324‑1325) and David Kusman, “Quand usure et Eglise font bon ménage. Les stratégies d’insertion des financiers piémontais dans le clergé des anciens Pays-Bas (xiiie‑xve siècle)”, in Bourguignons en Italie, Italiens dans les pays bourguignons (xiv e‑xvie siècle), ed. Jean-Marie Cauchies (Publication du Centre Européen d’Etudes bourguignonnes (xive‑xvie siècle), 49), Neuchâtel, 2009, p. 205‑225. 57 ADN, 28H/81, n° 1442a (21/1/1316), draft version and 28H/81, n° 1442b (22/1/1316), final version of the notarised alienation of the abbatial granges. It is here worth mentioning that the original 1315 debt recognizances probably had bearer clauses, such as the one edited by Bigwood, Le régime juridique, vol. 2, n° 35, p. 330‑331. 58 ADN, 28H/81, n° 1446 (25/8/1317) and n° 1452 (c. 1324‑1325). 59 ADN, 28H/81, n° 1453 (c. 1330). 60 In 1331, ordinary receipts for the Count of Flanders totaled 32,500 pounds tournois: Maurice Vandermaesen, “Le droit de livrée à la cour de Louis, comte de Flandre, de Nevers et de Rethel en 1331”, in Secretum Scriptorum. Liber alumnorum Walter Prevenier, ed. Wim Blockmans et al., Leuven-Apeldoorn, 1999, p. 279‑306, here p. 289.

99 David Kusman & Jean-Luc Demeulemeester

Unable to cope with the burden of interest, the monastic community was placed under the guardianship of four other Cistercian abbeys, Ter Duinen in Flanders, Clairmarais, Loos and Cambron, all in the county of Hainaut. These four abbeys paid back the Lombards. Acting as sureties for Vaucelles towards the Lombards, the four abbeys claimed the right to tutelage over the rich granges located in Baudival in the Cambrésis region, and in Cuvele, near Knokke, in maritime Flanders, in a polder zone (see Map 4 for the location of Cuvele). In 1326, the abbeys’ procurators succeeded in estranging the Cuvele grange, c. 200 hectares of land in area. In order to reimburse its sureties, the abbey of Vaucelles had to sell life-annuities guaranteed by the revenue of Cuvele.61 An abbey selling annuities as a survival strategy during a debt crisis was by no means an uncommon action in the southern Low Countries at this time. Benedictine and Cistercian monasteries also resorted to these long-term loans, in Brabant as well as Flanders. The Cistercian abbey of Ter Doest in coastal Flanders even went so far as to seek the consent of Pope John XXII to set up life-annuities of up to 200 pounds per year as a way to stimulate investment. As these proved insufficient, the abbey opted to lease its estates indirectly, in contrast to Vaucelles.62 The great distance (c. 130km.) between Vaucelles and Cuvele indicates that the Flemish grange was profitable and explains the rational decision to keep the grange under direct exploitation.63 Selling annuities created a sort of funded debt for the monastic community budget. The abbey had yearly expenses of 30 lb. 10 s. vieux gros in annuities. The median yearly income of the annuities was the relatively small amount of 1 pound, whereas only three purchasers bought annuities valued at 7 pounds per year. The total income from the annuities was 2,800 lb. petits tournois.64 Most of these life annuities were sold for the duration of two lives, as children of the buyers were to hold the credit titles after their parents’ deaths. Using one of the common exchange rates of the period, sixteen deniers petits tournois for one gros tournois, the interest rate for these annuities approached seventeen percent, which reflected not only the poor state of the abbey’s finances but also the peasant revolts that shook Maritime Flanders in 1328.65 The interest rate was in line with the average interest rate on life-annuities in Mechelen at the time.66 It made the whole

transaction quite a profitable investment for the annuity buyers. There was an institutional

feature that might have assuaged the fears of the Cistercian abbey’s creditors: all authorities

61 ADN, 28H/81, n° 1668 (30/7/1326) for the decision to sell life-annuities, and ADN, 28H/81, n° 1670 (7/10/1327) for a list of the life annuity buyers.

62 As demonstrated by William Chester Jordan, The Great Famine. Northern Europe in the early fourteenth century,

Princeton, 1996, p. 68‑69.

63 Janet E. Burton & Julie Kerr. The Cistercians in the Middle Ages, Woodbridge, 2011, p.168. Bas van Bavel,

“The emergence and growth of short-term leasing in the Netherlands and other parts of northwestern Europe (eleventh- seventeenth centuries). A chronology and a tentative investigation into its causes”, in The development of leasehold in

, ed. Bas van Bavel & Phillipp R. Schofield (Corn Publication Series, 10), Turnhout, northwestern Europe, c. 1200‑1600

2008, p. 179‑213, here 201, shows clearly that the Cistercians gained no advantages whatsoever from indirect exploitation, given the efficiency of their manorial organisation. On the profit-driven ventures of the Cistercians in the southern Low

Countries, see the classic article of Georges Despy, “Les richesses de la terre: Cîteaux et Prémontré devant l’économie de

e e profit aux xii et xiii siècles”, in Problèmes d’histoire du Christianisme , 5, 1975, p. 58‑80.

64 ADN, 28 H/81, n° 1682, WW, n° 17/1 (c. September 1331).

65 David Nicholas, “Economic reorientation and social change in fourteenth-century Flanders” in , , Past and present

70, 1979, p. 3‑29, here 17‑20. A financial report written by the four procurators of Ter Duinen, Cambron, Clairmarais and

Loos on the productivity of the Cuvele grangia explicitly stated that the wars of Flanders had made access to the landed estate impossible for the moment (ADN, 28H/81, n° 1678, WW, n° 16/1 with the in dorso mention: “approbatio computationis de

Cuculla tabellionata 1329” (19 june 1329). 66 Peeters, “Het financieel-economisch profiel”, p. 113.

Connecting Regional Capital Markets in the Late Medieval Low Countries and princes, such as the counts of Flanders and Hainault, who engaged in business with the Piedmontese bankers could legally assist them in collecting debts, including the seizure of the movable and immovable goods of the debtor and his or her sureties. The social profile of the burghers who invested in the Vaucelles life-annuities sold on the Cuvele grange reveals a glimpse of the “little” world of Vaucelles’s life annuity buyers. Most of the eighteen purchasers of these annuities were rich burghers from mercantile towns, such as Antwerp, Brussels, Mechelen, Geerardsbergen and Ghent, although more than half of them came from Brussels (ten out of eighteen). They represent well wealthy burghers’ circles in the principal large cities of the former southern Low Countries. There was, for example, a wealthy Brussels rentier couple, the Ser Daenkens, good clients of the Mechelen Lombard bank since 1311.67 Patricians from Antwerp and Ghent (from the Bacheleer and Borluut families) were also among the annuity purchasers.68 These patricians from Antwerp and Ghent would have been kept informed about Vaucelles’s bankruptcy and guardianship. In addition to his position as money-changer and financial agent for the Count of Hainaut, Holland and Zeeland, Jan Bacheleer was a merchant who sold wool cloth to Mechteld van der Marck, wife of the Lord of Mechelen, Floris Berthout.69 Who was in a better position to tip them off to this opportunity than the Lombards with their dense banking network? Not only were there Lombard banks in Ghent and Antwerp, but other sources testify that the Lombard banks of Ghent, Mechelen and Valenciennes collaborated in granting loans to Flemish abbeys in 1315.70 The prospect of investing capital in the Cuvele grange was attractive; this polder zone had fertile soil for grain production and good conditions for sheep breeding. Needless to say, the merchant bourgeoisie of Brabantine and Flemish towns always kept an eye on the two promising commodity markets of the Late Middle Ages: grain and wool.71 The diversity of social actors involved in the bankruptcy of Vaucelles makes one thing clear: financial and commodity markets were well connected on a interregional scale. Merchant elites from major textile towns in the southern Low Countries collaborated with Piedmontese bankers, bishops and secular princes, from the Cambrésis grain region to Maritime Flanders. The unfolding of events at Vaucelles illustrates a widespread trend. The Piedmontese bankers came first as credit purveyors for a less advanced capital market, offering borrowers huge sums of money and connections with the broader world of merchant and patrician elites in regions with more sophisticated capital markets, such as Brabant and Flanders.

67 In 1311, members of the Ser Daenkens family transferred their life annuity of 64 lb. 40 d. payment to the account of Giovanni de Mirabello, one of the creditors of the Vaucelles abbey in 1315. These citizens from Brussels undoubtedly had their eyes on the profitable prospect of investing capital in Lombard loans (SM, town account n° 1, (1311‑1312), fol. 128v°). 68 Kusman, Usuriers publics, p. 290‑291. 69 Godfried Croenen, De oorkonden van de familie Berthout, 1212‑1425 (Commission Royale d’Histoire, collection in-4°), Brussels, 2006, n° 103, p. 152 (17/4/1319); Homme Jacob Smit (ed.), De rekeningen der graven en gravinnen uit het Henegouwsche huis, vol. 3 (Werken uitgegeven door het Historisch Genootschap gevestigd te Utrecht, 3e S. 69), Amsterdam- Utrecht, 1939, p. 194. 70 David Kusman, “Jean de Mirabello dit van Haelen (c. 1280‑1333). Haute finance et Lombards en Brabant dans le premier tiers du xive siècle”, in Revue Belge de Philologie et d’Histoire, vol. 77, 1999, p. 843‑931, p. 860. 71 Stéphane Lebecq, “Les cisterciens de Vaucelles en Flandre maritime au xiiie siècle”, in Revue du Nord, 54, 1972, p. 371‑384; Adriaan Verhulst, “La laine indigène dans les anciens Pays-Bas entre le xiie et le xviie siècle. Mise en œuvre industrielle, production et commerce”, in Revue historique, 247, 1972, p. 281‑322. On the strong market-orientation in coastal Flanders and the common practice of selling annuities as a mean of credit since the 1260s, see: Tim Soens & Erik Thoen, “The origins of leasehold in the former county of Flanders” in The development of leasehold, ed. Van Bavel & Schofield, p. 31‑55.

101 David Kusman & Jean-Luc Demeulemeester

When the debtors failed to keep up with their interest payments, part or all of the debt was restructured into sales of annuities, i.e. public debts. This phenomenon occurred again in Guelders around 1325‑1339, when Count Reginald of Guelders sold annuities to burghers of Brussels and Leuven, payable at the city exchanges of Antwerp, Brussels and Leuven.72

Concluding Remarks

In a brief but stimulating footnote from 2000, S.R. Epstein contended that “ the extent of market power (competition) and institutional efficiency (integration) in pre-modern credit markets has still to be examined in detail”.73 This paper has attempted to fill that gap. We analysed three case studies in order to show the crucial intermediary role of Piedmontese bankers in the development of interconnected regional capital markets in the Late Medieval Low Countries. The first focused on the politico-economic issue of war finance, as the count of Guelders sought access to more advanced capital markets than those existing in his own principality through the intermediation of Piedmontese financiers and the informal connections of counsellors and clerks. Reginald of Guelders’ limited experience and, particularly, his loss of the Limburg war put him in a difficult political situation and left him with an unsustainable level of indebtedness which led to his loss of political sovereignty. Indeed, the transfer of his debt from a Piedmontese banker to the count of Flanders subjected the Guelders count to the economic and political control of Flemish advisers. The transferability of credit instruments was pivotal in connecting Guelders to more highly commercialised regions. The second case study emphasised the stimulating role of Piedmontese financiers in linking public finance to private credit with advanced banking and accounting techniques. To support our thesis, we demonstrated that the city financial structures of Brussels, ’s-Hertogenbosh and Mechelen were pioneers in the field of financial innovation in the early fourteenth century, a pattern that has been underestimated in the existing literature. The final case connected these developments and the path-breaking Piedmontese bankers, who had access to information and circulated it, in order to increase opportunities for wealthy

burghers to locate and purchase remunerative investments on an interregional scale. Their

extensive supraregional banking network and strategic locations facilitated the collection

of commercial and political information on the most rewarding investment options (for

themselves and their depositors). The Vaucelles credit deals illustrate their ability to anticipate

promising commercial investments such as large-scale annuity sales in the Low Countries.

This evidence shows an advanced level of interregional financial integration and

a high degree of sophistication in financial and banking practices of the southern Low

Countries. It highlights the Piedmontese bankers as pathfinders and emphasises their key

role in transferring advanced banking and accounting techniques from northern Italy to the

Low Countries and from the private sphere to the public financial sector.

72 In 1325 Giovanni de Mirabello and his associates from Mechelen loaned Reginald II of Guelders the huge sum of o 48,000 lb. noirs : Regional Archives Zutphen, Oud archief stad Zutphen, inv.n 734 (reg.n° 72 d.d. 4/3/1325). tournois

The loan was fully paid to the son of Giovanni, Simone de Mirabello, in 1342 (Kusman, Usuriers publics, p. 357). For the life-annuities sold to burghers of Antwerp, Brussels and Leuven, see Ulrike Spengler-Reffgen (ed.), Emmericher Urkundenbuch. Urkunden 828‑1355 (Emmericher Forschungen, 18), Emmerich, 1999, n° 280, p. 257‑259 (27/9/1339). The sale of life-annuities was doubtless prompted by the need to service the Lombard debt. 73 Epstein, Freedom and growth (see note 12), p. 61, n. 74.