Florence in 1400, setting the stage for the coming innovations, contrasts strongly
with the little
town of Paris in 1200. It is one of a number of prosperous and economically advanced city-states, a
republic governed by its leading citizens, who are all merchants: that is the first large difference.
In
Italy, the richest region of Europe, it is a focal point of an international economy; it has become
great by dominating the textile industry, which is a complex flow of transactions that starts with
English wool exports, passes via the Flemish weavers and trade fairs down to the dyeing and
finishing workshops of Tuscany, and then continues in the shape of high-grade finished goods
outwards to Europe and the eastern Mediterranean and beyond, in exchange for flows of
imports—spices, silks, rare objects—that arrive from Asia
and the Middle East via Tabriz or
Alexandria or Constantinople. The scale of this Florentine trade is five or ten times larger than that
of comparable towns in the Low Countries, and in Europe is matched only by Venice.
The chief merchant houses of Florence (as of other Italian cities) have also used
their wealth to
develop financial services—banking—with sophisticated
branch networks throughout Christendom,
especially along the axis of their major trade. Among their customers the Florentines have, in
addition, one particularly important and steady client, not all that far away— the Church in Rome.
For the Church is now run by a very advanced and elaborate curia, and its international financing
needs are huge: the transmission of ecclesiastical taxes from far and wide to Rome or elsewhere,
transfers of funds involving distant benefices, advances to travelling prelates, the supply of money
for large international councils. This traditional connection is highly lucrative, and commands good
interest rates; no questions about'usury'arise in matters of this kind . . .
One Florentine house
that is conspicuously committed to the business is that of the Medici; it has
branches all the way from Bruges (originally for the cloth trade) to Naples (financing imports of corn
from
Sicily) and Rome (banking). Its head, until his death in 1429, is Giovanni, banker to Pope John XXIII
(the
first of that number) and his successors; Giovanni is also 'prior', or head, of the guild of money-changers
in Florence. His son Cosimo, who succeeds him, continues these policies.
The city is strategically
placed, then, for all that concerns its prosperity: astride international trade, with a
large manufacturing resource, and a happy position for benefiting from its proximity to a major 'power'.
It
is also vulnerable. Florentine business houses are apt to be ruined when they lend large amounts to
foreign princes, as happens when Edward III of England defaults on his debts in the 1340s. The Black
Death is a disaster which over a period of thirty years from 1348 more than halves the population of
Christendom. The Hundred Years' War, the Italian wars between Milan and Genoa and Venice, the
downfall of the French ruling Angevin dynasty in southern Italy, the removal (twice) of the papacy to
Avignon, are all major hazards. More ominously, the Ottoman Turks are slowly crushing the Eastern
empire and by 1357 have arrived at Gallipoli. Ten years after that, the Mongol general Tamerlane arrives
from nowhere to devastate the Middle East: these distant catastrophes begin to tilt the balance of world
trade. Worst of all, the rise of textile industries in north-western Europe itself has begun to undermine
the
foundation of Florentine wealth.
Florence survives, and
even prospers. Its policies are prudent; it annexes some of its small neighbours,
and thereby acquires a valuable sea-going capability. Yet there are internal stresses. The republic
does
not escape the wave of trouble that passes through many fourteenth-century European towns in the wake
of depression.
