Published online by Cambridge University Press: 28 March 2008
Introductory: Main Features and Phases
Scholars have been inclined in the past to regard the entire medieval period as a primitive stage in the development of public credit. In part this was the legacy of views expressed most clearly in the second half of the nineteenth century by Bruno Hildebrand (1864) and his followers who treated the Middle Ages as a time when credit could play at best only a minor part. These basic assumptions are today discarded by historians. But one particular argument much used in the past deserves more detailed comment. Some older scholars had attached great importance to the fact that the debts of medieval rulers were, almost invariably, regarded as the personal obligations of the reigning sovereigns. They maintained that it is, therefore, impossible to speak of a true national or state debt under medieval conditions. Continuity, it was stressed, could only come with the introduction of modern funded debt. Only the municipalities have been exempted from this charge of backwardness, because they sold annuities, and they have even been hailed as the true creators of public credit.
It is quite legitimate and valuable to stress the contrasts between the medieval and the modern forms of public borrowing. But it would be misleading to apply to the medieval public credit this particular test. The presence or absence of the funded debt cannot be a valid criterion of the importance of the credit transactions of the territorial rulers at any time or place in medieval Europe. The treatment of the debts of medieval rulers as personal obligations of the princes who contracted them was an inevitable consequence of the prevailing, purely personal, conception of sovereign power. But the practical consequences of this must not be exaggerated.
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