It followed, almost as a necessary consequence of the commercial activity of Antwerp, that this city soon became a great monetary centre; in this respect again it had the character of a permanent fair. The fairs of the Middle Ages had been the great occasions for financial transactions of every kind; rates for making remittances could be easily quoted, and loans could be negotiated to run to the date of the next fair; there was a sort of clearing-house at each fair for settling the transactions that took place during its continuance. One district after another had been the principal scene of these operations; the fairs of Champagne had given place to those of Geneva; Geneva had been superseded by Lyons, which Charles VIII found a convenient place for making payments to his Swiss mercenaries. In the sixteenth century Antwerp took the lead; it was a money-market where there was less organisation and more freedom for negotiating loans than at Lyons; business was carried on with little variation all the year round and was not restricted by the definite dates fixed by the occurrence of the fair; nor was there any attempt to fix a normal rate of exchange, as had been the practice at Lyons. The merchant had far better opportunities here than elsewhere of borrowing capital at the moment when he required it, and for the precise term desired by him; so that mercantile life at Antwerp had many features in common with the commercial centres of the modern era. The discovery of the New World, with its enormous treasure of precious metals, introduced an extraordinary confusion into economic relations in Europe. There are many unsolved problems as to the course of the distribution of the American silver and the effects produced by it in different countries; but at all events we can see that the money-market at Antwerp was so arranged as to be capable of taking a very effective part in the transference of the precious metals from country to country, and in facilitating the application of capital to new enterprises.
These monetary and commercial conditions were favourable to rapid growth; and Antwerp rose quickly from comparative unimportance to be the leading city of Europe. She was enriched by her connexions with Lisbon and the spice-trade of the Portuguese; she did not, however, remain a mere trading city but became a manufacturing town as well. There was a considerable migration of German industry in the wake of German capital: both the linen and the fustian manufacture were attracted to a region from which there was such easy access to distant markets. The prosperity of the town increased by leaps and bounds, until in 1576 the Spanish Fury dealt it a blow from which it never recovered.
Though her greatness was short-lived, Antwerp occupies a very important place in the transition from medieval to modern commerce; for her merchants are said to have developed the modern system of commission-business. In the Middle Ages every possible obstacle had been put in the way of such transactions. Each merchant travelled personally with his own goods, or consigned them to a factor who acted exclusively as the representative of a single employer. Each -city was cautious about admitting outsiders to any trading privileges within its walls; and no merchant, who was free to carry on business himself, was allowed to “colour” the goods of an unfree trader, or to act as his broker. At Antwerp no such jealousy of outsiders existed: any one might settle and commence trade, and there was no objection to his doing business for the men of any city, or on any terms that suited him. This implied an immense reduction in the cost of maintaining agencies and in the incidental expenses of trade; and when once the new system got a fair trial, there could be no doubt that it had come to stay.
The rise of Antwerp is also significant of the change in the centre of gravity of the world’s commerce which has occurred, since ocean voyages have become the chief means of mercantile intercourse. The Mediterranean ports were left stranded, and Lisbon failed to take their place. The trade which had been opened up by Portuguese enterprise did not react on home industries, or give increased and profitable employment to productive labourers. The carrying trade between Lisbon and Antwerp was largely taken up by the merchants of Holland, who had ships and sailors engaged in fishing, and these could be easily and remuneratively employed in other waters. The Iberian peninsula offered an immense market for the salt-fish, the cloth, and linen of the Low Countries; Antwerp merchants had the means of purchasing the products brought from the East. While the energies of the Spaniards and Portuguese were thrown into the task of establishing their power in the Indies, and prosecuting distant trade, the Netherlanders reaped much of the profit of carrying goods in European waters, and their industrial and maritime activity was greatly stimulated. Antwerp obtained for a time that supremacy in the world’s commerce, which has never since been wrested from northern ports.
The discussion of the application of capital to commerce, and of the changes in business practice which it introduced, have led us far away from the rise of the Augsburg merchants in the fifteenth century. We should have to turn back to a very early time in order to trace the first beginnings of the influence which capital exercised on manufactures; indications of it can be found in the thirteenth century, but it was at that date quite exceptional. Medieval industrial organisation usually consisted of a number of separate gilds, each composed of independent craftsmen; these associations had the power of regulating the trades with which they were respectively connected, subject to the approval by municipal or royal authority of the manner in which they exercised their rights, and of the particular rules which they framed. If we are careful to remember that, while this was the ordinary state of affairs, it was not universal in all cities, that its origin was not the same in all places and that it did not hold good equally in all trades, we may look a little more closely at the economic features and conditions of this type of organisation.
The craft-gild was formed with reference to the requirements of a particular city, and looked to a very limited circle of the public for the demand for goods. Part of its function was to see that the quality of the goods was maintained; but its policy was chiefly determined by a desire to give each member his fair share of the available employment. Each master was to have his chance, and none was allowed, by unduly multiplying the number of apprentices or journeymen, to supplant other workmen. These restrictions told in favour of the good training of apprentices, and improved their chance of employment as journeymen after they had served their time, but the rules hampered any man who was trying to push his business and manufacture on a large scale.
The master workman would be in the habit of buying on his own account the material which he required, or he might have the advantage of purchasing wholesale in association with other members of the craft; he would also sell the finished article to the man who wished to use it-the consumer; in some crafts, such as the tailors’, an even more primitive practice was long maintained, and the craftsman worked on materials furnished to him by the consumers. Hence we can see that there were two points at which the intervention of the capitalist would easily occur. In the case of goods exported to a distant market, when an exporting merchant was the customer, he might find it convenient to have them manufactured under his direction and at his time instead of procuring them from an independent craftsman; the transition was easy from the position of a constant purchaser to that of an employer. On the other hand, when good$ were made from imported materials, it was convenient for the merchant to retain his ownership in the materials and employ craftsmen to work them up. The effect of drawing any industry into the circle of distant trade with reference either to the materials or to the vent for the product, was to render capitalist intervention almost inevitable; when the capitalist system is thoroughly adopted, the employer owns the materials and also undertakes to act as an intermediary in the disposal of finished goods. It is needless to observe that, when this transition is complete, it becomes the interest of the employer to push his trade and to turn over