'Lack of money': a reappraisal of Lessius' contribution to the scholastic analysis of money-lending and interest-taking

Abstract

The Jesuit theologian Leonard Lessius contributed his own small part to the intellectual renewal of the so-called 'School of Salamanca' by introducing into the scholastic doctrine on lending a new extrinsic title, which he termed 'lack of money' (carentia pecuniae). In this article, I re-examine the genesis of the extrinsic title in light of new evidence that I have discovered. I continue with a thorough analysis of the title itself. I argue that the introduction of carentia pecuniaewas a highly significant contribution to late scholastic economic thought because of its insight that interest represented the time value of money which was to be determined by a common estimate on the loan market or Bourse. Finally, I try to explain why Lessius did not consider it completely inconceivable or at odds that it was morally acceptable for merchants to fix a market or Bourse price for money lent, while at the same time remaining faithful to the traditional ecclesiastical prohibition of usury.