Acton Institute Powerblog

The forgotten Catholic founders of economics

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Many people acclaim Adam Smith as the father of economics. Others trace the origins of economics to the eighteenth century Physiocrats, while others look back far as Aristotle. “The real founders of economic science actually wrote hundreds of years before Smith,” wrote Lew Rockwell at Mises.org. “They were not economists as such, but moral theologians, trained in the tradition of St. Thomas Aquinas, and they came to be known collectively as the Late Scholastics.”

These thinkers, who were associated with Spain’s School of Salamanca, “brought Catholic standards of justice to bear on” numerous economic questions. Rockwell then profiles four of its most influential writers, beginning with:

Francisco de Vitoria

The University of Salamanca was the center of Scholastic learning in sixteenth-century Spain. The first of the moral theologians to research, write, and teach there was Francisco de Vitoria (1485-1546). Under his guidance, the university offered an extraordinary 70 professorial chairs. As with other great mentors in history, most of Vitoria’s published work comes to us in the form of notes taken by his students.

In Vitoria’s work on economics, he argued that the just price is the price that has been arrived at by common agreement among producers and consumers. That is, when a price is set by the interplay of supply and demand, it is a just price. So it is with international trade. Governments should not interfere with the prices and relations established between traders across borders. Vitoria’s lectures on Spanish-Indian trade—originally published in 1542 and again in 1917 by the Carnegie Endowment—argued that government intervention with trade violates the Golden Rule.

Yet Vitoria’s greatest contribution was producing gifted and prolific students. They went on to explore almost all aspects, moral and theoretical, of economic science. For a century, these thinkers formed a mighty force for free enterprise and economic logic.

For the rest of his profile, as well as an overview of Martín de Azpilcueta Navarrus, Diego de Covarrubias y Leiva, and Juan de Mariana, continue reading here.

Last November 29, the Acton Institute held a conference in Rome titled “Globalization, Justice, and the Economy” to celebrate the 800th anniversary of the Universidad de Salamanca. You may watch a rebroadcast of the conference via LiveStream or read Michael Severance’s thorough review of the school’s work here.

For more comprehensive information about the School of Salamanca, see Faith and Liberty: The Economic Thought of the Late Scholastics by Alejandro Chafuen, or a collection of texts by the Late Scholastics on monetary theory edited by Stephen J. Grabill. You may prefer smaller original texts by the authors mentioned in this article: Martín de Azpilcueta’s On Exchange or Juan de Mariana’s A Treatise on the Alternation of Money.

(Photo credit: لا روسا. This photo has been cropped. CC BY-SA 4.0.)

Rev. Ben Johnson Rev. Ben Johnson is Senior Editor at the Acton Institute.

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