Charles Kindleberger's "A Financial History of Western Europe" (1984) is a basic chronology of money and banking in Europe, and serves as a textbook for the topic. For this review, I will be going through chapters 1-8, which traces a development of banking from 1200 - 1900 CE, from independent creditors to central banks.
Chapter 1 is an introduction which can be passed over, but it does present a comprehensive timeline [pp. 9-14], so we will begin with Chapter 2, which concerns the development of money. The first section concerns the "function of money" [pp. 19-20], which as he writes, has a spatio-temporal dimension, for short-term and long-term uses, and also between distant transactions. He ascribes three basic functions to money: (i) medium of exchange, (ii) unit of account, (iii) store of value. Media of exchange overcomes the "double coincidence of wants", unit of account allows for relative valuation, and store of value is a function for long-term investment. In terms of the origin of money [pg. 21], Charles cites the work of Bruno Hildebrand (1864) to show that the view of an original barter is incorrect, and that credit relations existed all throughout the ancient and medieval periods. He doesn't go in depth, but still offers this consideration - along with stating that a medium of exchange is not required to have a money of account, using France from the 10-18th century to display an independence of circulation and accounting [pg. 22]. Here then, accounts can be abstractly recorded between creditor and debtor.
In Chapter 3, the origin of banking is connected to the bills of exchange circulated by international merchants [pg. 35]; an apparent 13th century innovation [pg. 39]. We do know that crediting obviously preceded banking, and that international accounting for deposits and withdrawals (along with bills of exchange) at least emerged with the Knights Templar Bank (1150-1307). Around the same time, he writes [pg. 36], medieval fairs were established for the sake of international trade. In the 12th century, transnational markets existed, just like in ancient times, but this was not yet a global market, such as we see emerge within the 16-17th century. W.S. Jevons comments on the decline of "merry England" and the May Pole, connected to the decline of medieval fairs, which is in tandem with the rise of capitalism, and so it proves Marx right, that in prior times, commerce ruled industry, but now the reverse is true. Internatio
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