Already it will be clear that the commercial world of the fifteenth century was far from static. In each section above there is mention of change — not all in the same direction, and not all at the same pace. Much change would be expected over a century, as new competitors challenged old centres, as new styles appeared and as specific circumstances encouraged or hindered trade in particular places. However, historians also perceive general pressures on the economy, common to many areas, producing contraction in the early century and allowing expansion at the end. The evidence is both patchy and difficult to interpret, and, not surprisingly, the scale, duration and even the existence of the contraction have provoked much debate. Some historians have seen the contraction as severe and long enough to be called depression; a few already identify expansion after the severe problems of the late fourteenth century; but many prefer the more neutral term ‘contraction’, pointing to major differences in response, which make an overall picture of decline and malaise inappropriate. Much of eastern Europe, although economically less advanced than the west, was unaffected by contraction, and continued to expand throughout the century, and in the west, whenever immediate disasters receded, the economy began to recover, indicating resilience and a sound infrastructure. Some sectors of the economy and some areas did well, but whether they made up for decline elsewhere is often impossible to say. English cloth exports are an excellent example of expansion. They rose from 40,000 cloths a year at the beginning of the century to nearly 60,000 cloths a year in the 1440s and, after a slump to about 35,000 (still far higher than in mid-fourteenth century) in the 1450s, returned to 60,000 before the end of the century. In 1380 cloths sold in Toulouse were 80 per cent Flemish and Brabantine; in 1430 they were 80 per cent English. But, while English cloth output rose, English wool exports and the volume of Flemish cloth declined. An area of quick recovery or adjustment appears to be northern Italy, where Milan developed a major arms industry, Genoa advanced in western Mediterranean trade and Venice increased her share of Levantine trade. Certain junctions of trade routes continued to prosper because the remaining trade was concentrated in them (Venice, Bruges); others, especially in Germany, developed as trade increased between west and east (Frankfurt/Main, Augsburg, Nuremberg).
If there was a general contraction in western Europe, what caused it? While there is not yet a consensus on their precise effects, three problems are identified, which affected all Europe to some extent. How a locality responded depended on its resources and infrastructure, and on the conjunction of the problems in that area. Although it has been said that every expansion carries within it the seeds of its own destruction through saturation or exhaustion, the problems identified are to a large extent ‘external’ — demographic changes, bullion shortages and warfare.
Trade responded broadly to fluctuations in population. Population, and thus demand and production, were low at the beginning of the century.
Demographic decline had probably begun in the early fourteenth century, and was accelerated by plague after 1348. The great epidemics were over by 1400 but many towns continued to experience small outbreaks: Barcelona eleven times between 1396 and 1437; Paris eight times during the years 1414—39. Towns repaired numbers by immigration, encouraging a drift from country to town, and from marginal to better lands, leaving areas underpopulated. In many regions of western Europe the population declined by one third to one half, in some cases even more, and remained low. Inevitably such a decline in consumers and producers meant a contraction of demand and production and, thus, in the volume of trade, especially in necessities. However, low grain prices, normally indicating agricultural recession, are sometimes overestimated as an indicator of more general economic recession in this century. It is true that great agricultural producers who had relied on grain profits suffered, and that lesser men who now enlarged their tenancies or obtained them for the first time did so in a time when they could not benefit from rising prices. Yet, for those who had had nothing before, to be self-sufficient in food or to have a surplus, however small, released energy for extra earning and increased opportunities for spending. Moreover, landholders at all levels could move out of cereals to more profitable crops, shifting to livestock or market gardening near towns, or to cash crops, such as woad, madder or flax. Cabbages, garlic and onions became a steady import to England from the Low Countries; cattle were driven to Hamburg from Ribe in Denmark; in Spain the Mesta’s flocks rose to 2.7 million sheep in 1467. While turning its own land to more profitable crops, western Europe could still enjoy cheap grain from eastern Europe. Thus, while the total volume of agricultural production and trade fell in the west, its value fell much less. Evidence concerning the textile trade is similarly complex. International ‘mass’ markets for cheap woollens exported from the Low Countries southwards in the thirteenth century disappeared in the fourteenth, and did not reappear in the early fifteenth. The lost volume was probably not made up by increased production elsewhere, but the increasing concentration on expensive woollen cloth in Flanders and Florence, and increasing amounts of fustian, linen, silk and velvet, meant that the value of the textile trade had similarly fallen far less than its volume, and in some regions might be greater. Moreover, an increasing demand for luxuries of all sorts, whether furs from Russia, paintings and tapestries from Flanders, silks, glass or jewellery from Italy, is clear in most of Europe.
Evidence of declining volume has, therefore, to be set against changing patterns of trade, and the precise effect of declining population provokes considerable differences of view between historians. Some emphasise the drop in the volume of trade, others the adaptability of the economy, although the two views are not incompatible. The emphasis tends to reflect the areas studied.
Historians of northern Europe and especially of England recognise the growth of conspicuous consumption and the luxury industries, but tend to emphasise a rising standard of living through higher wages and larger rural tenancies, and the continued widespread although moderate prosperity of merchants. In southern Europe, on the other hand, emphasis is placed on the high demand for luxuries and the increasing gap between rich and poor. This possibly reflects the more urban economy where urban oligarchies also more effectively controlled wages, and possibly also a poorer peasantry produced by the crop-sharing structure of the southern countryside.
The second problem, bullion shortage, although never ignored, was paid less attention a generation ago when the debate focused on the effects of population changes. Recently its impact has been better appreciated, and the worst shortage has been placed in the late 1450s and 1460s. Silver was lost through general wear and tear and accidental loss. Some was taken out of circulation by hoarding, either as prudent saving or by keeping silver as plate, a practice likely to increase in a period of luxurious living. Fear, often the result of war, encouraged further hoarding, particularly if coinage was debased. Such hoarding contributed to yet further shortages of specie. Bullion also flowed eastwards, for northern furs and above all for eastern spices and luxuries. Eastern imports were increasingly offset by the export of manufactured goods, and of supplies such as olive oil and even dyes which had once come from the Levant, but the trade never balanced. While Europe’s supply of silver was abundant this did not greatly matter, but when silver production declined at the turn of the fourteenth and fifteenth centuries, the outflow eastwards began to tell. Gold was an inappropriate substitute in local trade, although it might be substituted in the Levant trade if the gold-silver ratio was attractive. Credit could only substitute for temporary shortages, since long-term tight money inevitably led to tight credit and higher interest rates. These rose about 2 per cent, and while 12 per cent on commercial loans was not particularly high, it was considerably higher than a century before, and enough to help dampen demand. The bullion shortage was not uniform, depending on local resources and the flow of trade. England and Venice managed to keep stable currencies despite some problems. English fears of shortages were expressed in legislation against credit in international trade, and in the contemporary literary criticism of Venetian credit dealings in England, but trade was sufficiently well balanced to tide the country over. Venice too had problems but, since much of the bullion sent to the Levant flowed through it, the shortage was partially hidden. Venice also benefited from modest supplies of silver from neighbouring Bosnia and Serbia until the Turkish conquests there. Yet even in Venice in 1464 it was reported that the city was temporarily without silver coinage which had all been sent to Syria. A similarly acute crisis hit Valencia in 1451 when it was reported that two galleys could find no buyers whatsoever for their cargoes. Elsewhere shortages and war led to debasement. This caused less immediate damage to merchants than to those dependent on fixed rents for income. Unless merchants found themselves straddling a new debasement with an imbalance of letters of exchange or credit transactions, their gains eventually balanced losses - exports became more competitive, and consumers paid the higher import prices. None the less, although the intensity varied, bullion shortages were a substantial problem, especially in the 1450s and 1460s, and undoubtedly helped slow demand and undermine mercantile confidence. In the end shortages brought their own relief by encouraging prospecting and improved technology, and from the 1460s silver began to flow from new mines in Saxony and the Tyrol, and from reworked mines at Kutna Hora and Goslar.
War was the third major problem, but was intermittent and geographically patchy in its full effect. It had always haunted merchants. While some benefited from army victualling, the iron trade and armaments industries, most suffered, either directly from market closures, or indirectly from disrupted routes, impressed ships, increased piracy and brigandage, increased taxation and currency manipulations. In the fifteenth century states were better organised, better able to raise money and men and, thus, to wage war on a larger scale. Yet they could not control the forces they unleashed, and ‘free companies’ operated, especially in France and northern Italy. All over western Europe merchants had to cope with disrupted markets in the last stages of the Hundred Years War between England and France, whose kings allied variously with Portugal, Castile, Burgundy (whose duke inherited Flanders, then Brabant, Holland and Zeeland) and Genoa. At its end, England temporarily suffered by losing her semi-tied markets in Gascony, but the rest of France benefited from the cessation of war and its inevitable effects on French soil. Further south, rivalries between the Italian city-states led to almost continuous war. Venetian expansion on the mainland brought compulsory war loans between 1431 and 1441 estimated to have taken 28 per cent per annum of the assessed wealth of her citizens. Taxes recirculated through wages and payments for supplies, loans were eventually repaid or drew interest, but both hampered trade. In the north tensions between England and the Hanse led to the English seizure in 1449 of about sixty Hansard ships in the Channel, and to open war in 1468—72, a war which also exposed internal Hansard dissension when Cologne refused to follow Lubeck’s lead. The Hussite wars disrupted Bohemian trade, and, further east, the expansion of the Ottoman Turks, to whom Constantinople fell in 1453, substantially disrupted Black Sea and Levant routes. Even there, trade did not cease, but risks and costs increased. Venice withstood these best, and ended the century as the dominant European power in the east, carrying perhaps two-thirds of Europe’s Levantine trade, compared with one third at the beginning of the century.
It is not surprising that there are differences of opinion on the early fifteenth-century economy. It was complex, with many variables but few statistics, and the three general problems varied in intensity according to area and time. The population decline, which did not affect the east, was at its worst early in the century; the bullion shortage was most severe in mid-century, and war was intermittent. There is more agreement about the expansion which began sometime after mid-century, allowing western and eastern Europe to expand in tandem for the rest of the century. The exact date of the change might be rather fruitlessly debated, since, again, local circumstances slowed or speeded recovery, but by the late 1460s and 1470s the silver shortage had passed and in most areas the population was showing signs of growth. Bullion and population expansion together drove expansion. English cloth exports, having reached 60,000 cloths a year again in 1497—8, rose to 90,000 in 1507—8. Bordeaux, which had seen only 162 ships loading wine in 1448—9, received 310 in 1481, and 587 in 1509. Other fields of expansion included the new printing industry and book trade, the busy Baltic trade where the 0resund tolls show 795 ships to have passed in 1497, and 1,222 in 1503, and the ever-expanding exploration of west Africa and the Atlantic Islands, culminating in the 1490s in the discovery of America and the sea route to Asia. Even in expansion, some lost as others won. The Hansards lost control of Baltic and Scandinavian trade to increased Dutch and English competition, although trade through Hansard towns expanded; Bruges finally lost to Antwerp; the provincial towns of England lost to London; and the wealthy merchants of Burgos would soon lose to Seville. With hindsight we can see the opening of sea routes to America and Asia as symbols of a new era, with the commercial centre of gravity moving inexorably westwards towards the development of a truly ‘world economy’. Yet the sea-going and mercantile skills which produced this new era were those already familiar, honed and refined during both the difficult early and the prosperous later years of the fifteenth century.