Huerta de Soto J. (1996) The Bankers of Seville

September 9, 2009

 Huerta de Soto, Jesus (1996) “New Light on the Prehistory of the Theory of Banking and the School of Salamanca”, The Review of Austrian Economics, 9/2, 59-81.

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This article is available on line (pdf) 

Introduction 

During the 16th century, all the bankers of Seville inexorably went bankrupt. They were unable to meet the withdrawal demands from their depositors due to insufficient liquidity. Indeed they worked with fractional cash ratio, which allowed them to invest heavily in the shipping and tax collection business they owned and when confronted with an important demand of cash, they simply suspended payment (p.61). “Artificial credit creation, without an adequate base of real saving” was always threatening to push the city into recession. The positive effects of the practice reversed in the second half of the century (p.62). Read the rest of this entry »

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De Roover R. (1955) Old dead right men

July 1, 2009

De Roover, Raymond (1955) “Scholastic Economics: Survival and Lasting Influence from the Sixteenth Century to Adam Smith”, The Quarterly Journal of Economics, 69/2, 161-190.

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However economics textbooks sometimes mention Thomas Aquinas, they generally overlook the fact that he was followed by almost five centuries of refined followers who greatly improved and expended his system. Of course, those scholars never considered economics as a field in itself but as an appendix to ethics and law (p.162). Read the rest of this entry »