Le Goff J. (1986) Usury, religion and the birth of capitalism in the Middle Ages

Jacques Le Goff (1986) La Bourse et la vie. Economie et religion au Moyen Age, Paris, Hachette, 150p.*


After the council of Lateran IV (1215) confessions became private and regular instead of rare and collective. The individual became responsible of his own sins instead of assuming his share of the sins of the whole society. Pawnbrokers are thus suddenly singled out by the church as symbol of cupidity at a time when the central quality put forward by the Church was poverty.

Condemned by the Church

In the eyes of the 12th- and 13th-century theologians, usury favoured idleness, went against productive labour and favoured dearth and famines. For the medieval Church, following in that both parts of the Bible, usury was more than a crime: it was an act going against nature like homosexuality and a mortal sin like simony (33). Usury sold what did not exist (unlike a tree it bears no fruits, so a sum lent should be recovered in full but without interest since no ‘harvest was lost’) and thus was considered as a form of theft. It was going against the principle of fairness the church tried to imposed on the economy (fair price, fair wages) (34). The pawnbroker was seen as a person selling time, but time only belonged to God, so not only was it a sort of theft, but the victim of this theft was God himself (53).

Usury was singled out and banned while other practices quite similar were allowed because a sum lended (unlike say a land rented) did not get worn off by its usage (the principle of inflation was unknown). It is although important to remark that in the mean time the church allowed investments in commande and other systems invented to support trade (35). Moneylenders, unlike merchants, did not work, they exempted themselves from the form of redemption that the central Middle Ages were starting to find in labour (55). The pawnbroker did not fit in any of the three divisions of the medieval society (the workers, the fighters and the men of God), as such he belonged to a fourth one, the Devil’s (72).

Moneylenders in society

The growth of the medieval economy after the year 1000, increased the monetarization of the daily life. The role of the pawnbroker became much more significant in society. Interestingly, at the same time occurred the rise of medieval anti-Semitism (45). The condemnation of the Church only regarded the members of the local Christian society, Jews, Italian and Provencal bankers were allowed to practice usury (45). For the domestic pawnbrokers, usury was regarded as a dangerously fast way to access to wealth and power, endangering in the process the traditional hierarchy (48). Moneylenders were often described as ashamed of their profession and trying to present themselves as merchants; and indeed the difference between the two cannot be completely drawn before 1350 and often much later. Some of the mightiest trading families of Italy were heavily involved in moneylending (71).

A way to salvation

The only way for the money lender to save himself was to give up all his goods to those he had stolen from (56). Actually, usury was often regarded as a necessary harm — specially when the princes or the Church was involved — and thus forgivable at least by the law of man (62). In fact, up to a certain level of interest (very high by modern standards, maybe 33%). What was actually condemned was the pursuit of unfair profit and unreasonable interest rates (92). Theologians (some of them at least) developed five excuses for the reasonable lender to get a form of rewards from his creditors:

  1. The risk he took of not to recover his money.
  2. The immobilisation of his capital.
  3. Moneylending requires a certain amount of work (gathering and transporting the sum).
  4. Indemnities to be paid by late creditors.
  5. Incertitude over the solvability of his clients (95).

Progressively a new way appeared for the pawnbroker to save his soul: contrition, prayers and alms would allow him to escape the punishment of Hell, and after a certain amount of time spent in the newly invented Purgatory to access to Heaven (96). With this new hope of salvation, the church lifted the religious obstacle to the development of the central Middle Ages economy. Pawnbrokers in Heaven made the growth of the European capitalism possible (119).

* The edition used here is 2004 Hachette Littérature, Pluriel Histoire one, a translation exists in English: our Money or Your Life: Economy and Religion in the Middle Ages, translated by Patricia Ranum. (New York : Zone Books, 1988). Buy it here.

10 Responses to Le Goff J. (1986) Usury, religion and the birth of capitalism in the Middle Ages

  1. Latimer the Cat says:

    Interesting article, however it’s flawed in that it post facto assumes/sanctions the history rewrite mythology of a continuing Hebrew tribal lineage or tribal construct known as “Jews” which is actually a post 550 A.D. well-funded identity theft as the name Jew originally never based upon a lineage.

    • Ben says:

      Interesting point but since the article touches medieval matters (basically from 800 onwards), whether the term Jewish is rightfully employed or not has little influence, since the period is clearly posterior to the 6th century.

  2. John says:

    –“Progressively a new way appeared for the pawnbroker to save his soul: contrition, prayers and alms would allow him to escape the punishment of Hell, and after a certain amount of time spent in the newly invented Purgatory to access to Heaven (96). With this new hope of salvation, the church lifted the religious obstacle to the development of the central Middle Ages economy. Pawnbrokers in Heaven made the growth of the European capitalism possible (119).”

    This is incredibly stupid. The reality of purgatory wasn’t invented in the middle ages to allow usurers to repent of their sins but continue their evil business practice with a new found heavenly loophole. Le Goff is ignorant of true religion, the Old Testament and the New Testament. The understanding of purgatory is found in the Old Testament book of 2nd Maccabees 12:46 which was written well over one thousand years before the middle ages. Look into it!

    • Ben says:

      Even if you wish to believe that the Purgatory has existed for ever, you have to admit that it had been forgotten for some reason during the early centuries of Christianity and conveniently re-discovered as Le Goff indicates. True religion or not, human beings remain calculative and seek their interest in the world. Besides the principle of true religion is that no one agrees which one it is…

      • John says:


        The Church “forgot” purgatory during the early centuries but conveniently brought it back to aid the usurers of the middle ages? Wrong, dude. Never happened, unless you take Le Gaff as an authority. LOL.

      • Ben says:

        1. Jacques Le Goff is very much an authority. He was the leader of the Annales School, he’s recognized over the world. As far as authorities go, it’s difficult to find more authoritative. But the point could have been made by whomever, it is of no importance. The point is that the thesis’ out and if you want to contradict it, you’re welcome to do so but on the same ground. In Le Goff’s opinion regardless of the ideas held by the most enlightened thinkers of the time, the concept of purgatory spread only in the central Middle Ages (as the reunion of a council on that very matter indicates). If you think deep down that the man’s wrong, go to the archives and illustrate you point that in the 3rd, 4th, 5th, 6th, etc. century a Purgatory was thought of and accepted widely by the masses in Europe. Here the bible is of no help since if there is one thing we can be sure of is that every one does not interpret it the same way.

        2. The point made by Le Goff goes beyond that. He points out that the rules of the Church can be bent to the benefits of some. The church is not a pure entity immovable over time. It is constituted by human beings who live in society and thus are submitted to the pressures and fashions of that same society. In this case the Church was becoming a major impediment to economic development, it is interesting to realize that the Church bent to the pressure of economic agent and that it found a way to remain dogmatic without being too dogmatic… Here I don’t think you can really argue against because knowing just a little bit the history of the Church would show you that there is a bit of a difference between Borgia and Benedict XVI.

  3. John says:


    Spare me your long winded lectures, which are tedious and lack substance. The fact is that the canonical laws of the Middle Ages absolutely forbade the practice of usury.

    The Third Lateran Council (1179) and the Second of Lyons (1274) condemn usurers. In the Council of Vienne (1311) it was declared that if any person obstinately maintained that there was no sin in the practice of demanding interest, he should be punished as a heretic.

    Thus, during the middle ages the Church solemnly defined the evil of usury, and even suggested punishments. Yet you claim that during this same period the Church resurrected the idea of penance, repentance, and purgatory–things that had been routinely known and practiced always and everywhere in the religion–as loopholes to allow the usurers to go merrily along their way. This is propaganda and utter nonsense.

    • Ben says:

      I value comments posted on this blog hence I reply to them.

      It has not eluded me that your point has drifted from “there always has been a Purgatory in the doctrine of the church and the practices of the faithful” to “the Church never changed its mind on usury”.

      So on the second point, here is my (boring) answer: the church’s point of view on usury did not evolve much, it always condemned it. BUT 1. the definition of the usurer was highly unstable and changed over time (from basically whomever was loaning money at interest to a small proportion of professionals loaning money at usury rates) 2. the punishment of the usurer varied over time, from a temporal and divine absolute punishment to a much more milde one (which makes sense considering that the parents of some of the most important medieval theologians and ecclesiastical leaders were themselves bankers and you don’t support the sort of doctrines that sends half your family to hell).

      Besides, regarding the interest itself, the church in effect had different theoretical approaches (I believe that you can find clear evidence of that in many places on that blog). Just consider a few facts: several popes came from banking families, the Franciscans opened the Monte di Pietà all over Europe to fight usury BUT themselves asked for interest rates that today would seem very high, all the church was involved in one way or the other in lending money, the pope borrowed large amounts to Italian bankers and used their services to transfer money all over Europe, I personally know of the financial of a number of catholic institutions which were directly involved in lending money to commoners, to nobles and to kings).

      How do you want the popes and all the clergy to condemn a practice they themselves were deeply involved in? Once in a while they did drop a line on the subject (if you want to find some propaganda, you can start by looking there) but do you really believe it had any lasting impact? And if so how do you explain the fast pace of financiarization of the medieval European economy?

      • John says:


        You can write volumes but you haven’t defeated my original point which was that the Church never taught that usury was OK if the usurer repented and performed acts of penance in reparation for it. That was the gaff that I contend was committed by Mr. Goff (pun intended) in the passage quoted above. Perhaps you are confused and are thinking of the “selling of indulgences,” which was an abuse of a valid practice, and was not the true teaching of the Church. The teaching is that alms giving and acts of penance shorten one’s time in purgatory, assuming that the soul is not damned. That’s why I said that Le Goff needs to know the true religion in order to criticize the leaders of that religion. If someone thinks they can repeatedly commit usury and merit purgatory then they are mistaken, but you shouldn’t blame the Church for the misunderstanding, unless it was an official teaching, which it clearly wasn’t. True repentance means sorrow for sin (contrition) and a firm purpose of amendment, which means a desire to not commit the sin anymore. That would rule out the gaff of Mr Le Goff, which was that repentance was rediscovered by the Church in the Middle Ages to allow usurers to prosper. He doesn’t understand repentance, do you? Franciscans and others were charging usury? So they betrayed the Church. Two of the popes were supposedly Medicis (forerunners of the Rothschilds). Jesus chose an apostle named Judas who betrayed him. Does that discredit Jesus and his Church’s teachings? Of course not.

      • Ben says:

        First of all, I know who the Medici are… One of us here is holding a blog devoted to Economic History. And by the way I do not confuse the selling of the indulgences and the birth of the Purgatory either…

        Second the point of this blog is to think and debate around economic practices and thought through the ages, not mythology. Sorry, if it appears unholy to you. Here is not the place for religious propaganda nor theological debate. So for instance you’ll be kind enough not to refer to Catholicism as the “true religion”, which first of all is confusing (every one’s religion is the true one so…), second sounds dumb (we’re not in the 9th century nor is this blog a land where missionaries run free) and finally it is offending to others who may read it.

        Third it’s a bit easy to dismiss any argument going against you along the lines of “some black sheep in the flock” or “it was not the REAL teachings of the church”. Even if a practice is to be later considered as unorthodox, it is at the very least interesting for you to understand how it came into being (maybe to avoid it if the risk arises again). You should also consider that if you kick the Franciscans away, you should do the same to the Domenicans (who in Salamanca refined the position of the church regarding usury) and the Jesuits (who defended modern financial practices as legal) and pretty much any religious order whose finances rest on lending money. Since you’re at it please expel most of the popes and a large part of the clergy. The knights Hospitaliers too (and the Templars, but that’s been done already). There won’t be many people left in your church…

        Fourth, the church’s always condemned usury, but its definition of usury evolved. From a simple ban on any loan (pretty much if you follow the early Domenican theologians) to a much much more relaxed approach specifying some rates as non-usury, some situations (deposit’s ok) or some contracts (either term or fixed interest but not both) were legal in the eyes of the church. How do you think Italian or Spanish bankers would have even managed to survive if they had been consistently on the business side of the Inquisition? People burned in Venice, Florence and Rome, but as far as I can judge, not bankers.

        Fifth, how could the Church have lived with itself doing business with bankers and telling them “thanks for the money, now you’re going to hell”? It faced a massive contradiction, it just could not live with it (it had a problem quite similar with soldiers check how it solved it). One way around it was a form of forgiveness acquired post-mortem. You’re not even slightly bothered by the fact that the emphasis given to the concept of Purgatory (since you consider that it always existed) occurred at the very moment of the rise of mighty merchant-bankers? Doesn’t it bother you either that Italians were much more insistant on the idea of a Purgatory than say the Germans or the French?

        Then again, I’m only mildly satisfied by Le Goff’s ideas. He practices a sort of cultural history that does not genuinely interests me and that is often based on little else than suppositions. That being said I find your reaction most illuminating on the inner workings of a religious mind: something cannot be because it is not allowed to be and if it is real indeed, it is a mere deviance that is the work of the Devil or something. If you want to contradict a thesis based on secular practical observations use secular arguments. As far as I know I’m not trying to infer the nature of the Trinity based on the price trends of the potatoes market, lets not mix everything. Give back to Cesar what belongs to Cesar and to Adam Smith what belongs to Adam Smith.

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