The Medieval View of the Just Price and the Just Wage

My dear very close friends and relatives:

I, the great banker of my time, have traveled in Europe in 1250 year with the help of the time machine. I talked with the leaders of church and state, merchants and artisans. My observations led me to some conclusions about Medieval time. There are some similarities between fifteenth and thirteenth centuries as well as some differences. Just price and just wage of thirteenth century is one of the differences which I dislike. The cause of this mentality is religion ideology of that time.

Jack Coeur is the richest man in Europe in the fifteenth century. I am a steward of the royal expenditure, a banker of the court, and a member of king’s council came from the family of an ordinary furriror. Till my travel in the past I used to think that my talent is the only thing that gave me money and honor. After my travel I think that less influence of the Roman Church, an increase of the power of the kings, almost free prices, and market of competition were factors of my success as well.

Classes in the thirteenth and fifteenth centuries are the same: nobility, clergy, peasants, and town people. The difference is that there are more town people in the fifteenth century, and clergy is less powerful. Merchants in my time have more respect when in the thirteenth century. For instance, I have a lot of respect among the European elite. Unfortunately, merchants in thirteenth century were treated as sinners and had no respect. In the thirteenth century banking system is very simple. A banker sits on a bench and writes transaction on his ledger. In order to receive payments he travels from fair to fair. There is no even a bill of exchange which is commonly used in my time.

According to medieval people all prices should be fair. For example, the Christian shoemaker must sell shoes at a fixed price. By doing this he helps other shoemakers in his town. I suspect that these people believe more in Christian propaganda than in profit or technology. Indeed, additional profit is a sin for that time. There is no desire for invention. For instance, if a shoemaker invents new technology which reduces the cost of the shoes, he can sell more shoes at a lower price. Since the quantity of his sold shoes increases dramatically, he increases his profit. The problem is that the good Christian shoemaker should not put out of business other Christian shoemakers. If you are in a market and find a way to sell at a higher price than other sellers, you are called a sinful person because you sell at “unjust” price. Therefore, prices tend to be fixed and “fair.”

Medieval people believe in just wages as well. Gilds are supposed to provide help for all people of the same profession in a town. Christians need not compete with each other, but cooperate. The power of gilds is very strong. They control prices, wages, number of workers, and working conditions. The just wage of your employees should be enough for them to produce merchandise and to be good Christian. Therefore, they see no reason why local wages should be fluctuated. People of the same profession are not rivals, but friends who supposed to help each other.

I spoke with Thomas Aquinas and read his book Summa Theologies. I found little practical information from this book. His concept about price is foolish. Price should be fair. I want to ask, “Fair for whom?” For me the higher price of my products, the more just my price because I receive more profits.

According to the manorial system, landlord controls prices over village mill, winepress, sheepfold, stud bull, and oven. Since church possesses land and usually is supported by nobles, religious leaders support lord’s monopoly over his peasants. The economy is barter in the rural areas, and there is little need for merchants and moneylenders. I think that this socioeconomic condition creates hostility toward the middlemen. Also, by using the thirteenth century religious writers, prices in the village are unjust because there is a monopoly over prices.

Merchants and usurers are not respectful in that society. One of the religious thinkers of that society, Thomas Aquinas expresses it: ”the proper and principal use of money is the consumption or alienation of it whereby it is spent in making purchases. Therefore, in itself, it is unlawful to receive a piece for the use of money lent, which is called usury.” (Hughes and Fries 48). In the case of the merchants, the ideal merchant is who do not have capital outlay. The price of the product equals cost of the merchandise plus little profit. This profit should be enough for him to consume, to buy food and cloth, and to do business. The problem is that I as a merchant and banker cannot invest, have a luxurious life style, and consider myself a good Christian.

Although I do not like to spend my time reading Greek philosophers or commentators of the Bible, I can prove that religious leaders are illogical and biased when they condemn monopoly. The religious thinkers condemn monopoly, when one or few common people control the whole market. For instance, the great banker of my time, Jack Coeur is considered as a great sinner. This is a contradiction in their logic. I question their sincerity regarding monopoly. These bishops justify manorial system and condemn smart merchants. How can they justify lord’s monopoly over his peasants and condemn when a merchant tries to have a monopoly in a local market?

The key to all questions is money. Landlords are richer than merchants or bankers. Therefore, merchants do not have enough money to sponsor a theory which will justify their actions. I will make my relatives bishops, and let they prove to the elite and to the common people (with help of Aristotle or without him) that I am a righteous man. I am not interested in devils, angels, morality, sins, and goodness.

These thinkers do not understand that the easy money circulates in the country, the more will be wealth of the nation. For instance, Aquinas writes:

Human laws leave certain sins unpunished because of the imperfection of the men; many useful things would disappear, in fact, if all improper operations were rigorously forbidden. This is why civil legislation has at times tolerated usury, not because is thought to be just but so as not to hinder advantages that so many derive from it. (Summa Theologiae)

Therefore, interest prices are unjust and usurers are sinners. I do not like this idea. I am a banker of the French court and a merchant. I do not consider myself as a sinner. I am the best of the French people! No one can compare with my wealth! I made myself. My adventures, palaces, and business trade will be a legend from generation to generation!

I really began to appreciate my time after the visit to the past. In the fifteenth century price of the land fluctuate no less then other commodities. Luxury prices are very elastic. I can speculate about prices and interests! In our time, the investment, money lending, and using flexible price is a good way to get rich. If you are rich, you have enough money to tell clergy what is morally right or wrong and they will not call you a sinful person who has too much greed.