Roleplaying Resources

Investments in the Middle Ages

2/27/01 From (Rupert Boleyn):

On 27 Feb 2001 14:20:39 GMT, “Gary J. Robinson” wrote:

Agriculture is not synonomous with feudalism. The Romans, who had a
republic and then an empire, had a very large state treasury, and even
spent large portions of it on feeding the urban masses. I have no doubt
state funds would have been spent on these devices.

Only if it were more effective than the wheat dole, which I doubt. The Create Food & Water spell doesn't produce very nice food, so he who gives out wheat instead will overthrow you. Also remember that most of the wheat came from Egypt, which was personally owned by the Emperors, and as there wasn't a huge market for it (except for the poor in Rome, who couldn't afford it), they weren't losing that much money doling it out.

They were not careful unless they calculated to infinity, since we are
talking about endless generations of peasants.
You have forgotten opportunity cost. The 2700gp I don't spend on the
food generator is *invested* - and I end up with more than 2700gp.

Invested where? This is a medieval economy you want to be talking about
right? You think there are mutual funds and money market accounts? The
main investment in the Middle Ages was land, because it produced….food.

Weapons. Invest that money in weapons and troops and I bet you can make a darn good return. Always people who need a good army at short notice and are willing to pay a lot of money to borrow yours. And that's aside from any military adventures you might employ them on, and any protection rackets you set up with their help.

The question, then, is what is the *return*, each year, on that

You are slipping into modern thinking here with regards to gold that is
sitting in a chest under the king's bed.

Remember that insurance and double entry accounting date from the late MA, and the going rate for interest (despite usuary being condemed by the church) was often up around the 10-20% per _quarter_.

I think you'll find that the medieval city guilds and town councils understood commerce and economics quite well. After all they managed their guilds and cities quite successfully, and manipulated taxes, set food prices, labour, etc, etc to their profit consistently over a long period.

You really have to get over this interest bit. In a feudal society
wealth was measured in terms of land and people, and collecting interest
was, frankly, a sin, even if you were foolish enough to lend it out in
such an unstable time.

But Jewish money was in high demand and people would pay high interest rates (driven partly by the high risk) to get it. Besides there's no requirement that you directly loan the money to invest it. You could use it to buy a royal monopoly and invest in the business that expliots that monopoly. If you're a noble and find this grubby, buy monopolies and sell them at a profit. This was a common practice. Buy the taxation rights to a couple of counties. Invest in the spice trade. Sell insurance.

There were many, many ways to invest money without directly lending it, and many gave very nice rates of return, even allowing for lossage. And then there's the best of all - go to Poland, import German and French peasants (by offering them a good contract for the land), throw off or en-serf to local Slavs, and become a great lord of new land, only nominally owing any aleigance to anyone else.