The conventional model of the decline in rent seeking occasioned by Protestant entry into the religion market is, however, understated (by, for example, the area ABPp in figure 8.2). In order to appreciate this we must note that medieval economic development in Europe usually occurred most dramatically in cities that contained major churches or cathedrals. The great era of cathedral building in Europe was between 1140 and 1280, but the tendency of cathedrals to promote local expenditures persisted for many centuries. These spiritual temples were financed by contributions that were sometimes voluntary and sometimes forced. Understandably, there was intense local competition for cathedral sites. The glory and legitimacy of monarchs—which over this period owed more to the support of the papacy and their largely political representatives (the bishops of a region) than to the feudal aristocracy— depended on church support, in large measure because bishops were at the very top of the feudal hierarchy. According to medieval historian Georges Duby these "prelate-businessmen... owned the best lands and enormous barns which the tithes exacted at each harvest filled to repletion. They levied taxes on urban fairs and markets and part of the profits from trade and agriculture found its way into their coffers____[T]he social order of the time was so constructed that peasants and middle class were expected and enjoined to deliver a large part of their earnings to the military and ecclesiastical authorities.''16 While some such "donations" were, in view of redemption, "voluntary," many were not. The forced nature of such contributions is revealed in periodic revolts against bishops who pushed taxation too far. Duby reports that in 1233, infuriated by the exactions of an earlier prelate, the bishop of Reims's flock rose up against him and forced him to close down the work yards for a time and to dismiss the masons and sculptors in his service.17 Although contributions might appear to be "voluntary," the amount of "forced demand" is debatable.
The competition between bishops, as head politicians of medieval towns, was fierce. Duby's account of the building of the cathedral at Saint-Denis emphasizes this point:
From the stained-glass windows of Saint-Denis stemmed, in the mid-twelfth century, those of Chartres, Bourges, and Angers, all of them cathedrals; from its column-statues those of Chartres, Le Mans and Bourges. The architectural innovations of Saint-Denis were followed up between 1155 and 1180 at Noyon, Laon, Senlis, Paris and Soissons, all in the lineage of the cathedrals of Neustria.18
In much of Europe, moreover, the local religious bureaucracy such as the bishops' canons were becoming de facto entrepreneurs by selling commodities such as wheat and wine produced in their regions, and marketing the (in-kind) tithes they received. As Duby notes, "The bourgeois was known to be well off and the Church authorities deliberately squeezed him, confiscating on occasion his casks of wine and bale goods. Thus a large part of [the Church's] wealth was drained off from a section of the population that was steadily becoming larger and more affluent.''19
Locational competition for cathedrals was by no means fueled only by ecclesiastical interests. A new cathedral—and later the quantity and quality of its relic collection—attracted demanders and industry to particular towns. Communes of workers and businessmen marketed their cathedrals as spiritual guardians over industries and trades. Indeed, in order to do business in the medieval economy, one had to be member of and participant in the Roman Catholic religion. Heretics and non-payers (including Jews) were subject to excommunication, interdict, or other less humane punishments. The church devised a method of punishing usurers. For example, a deathbed confession of usury was levied with a punishment of payment to those injured. That is, if the guilty knew who he or she had wronged, the money (certa) went to the injured. If, as was often the case, the guilty was not certain about the injured party, the money (incerta) went to the church. Merchants who contributed to cathedral finance derived enormous benefits:
The status of being a ''man'' of the Church ensured certain privileges and exemptions from customs tariffs, of whose value the local merchants were fully conscious. This was one of the reasons why the merchant class regarded this splendid monument, on which they prided themselves and which they had adorned, as theirs. At Amiens the dealers in the dyes used for textiles felt that their renown was enhanced, if indirectly, by the beauties of the cathedral; at Chartres each of the guilds insisted on having its own stained-glass window. Huge sums of money were spent on these edifices... [which] justified the opulence of the city and increased its fame.20
Thus, far from simply being a place of worship, the medieval cathedral was a multipurpose structure with some of the characteristics of the modern commercial mall, union hall, court house, and amusement park.
Competition, in medieval times and in our own, almost always has a locational component. Urban centers with cathedrals vied fiercely for relics and works of art to adorn their churches.21 In the manner of modern sports stadiums, medieval cities engaged in a kind of spatial competition for ever grander cathedrals that inflated the costs of providing religious services of all kinds, including assurances of eternal salvation. In this as in all economic matters, the true cost of the cathedral was the opportunity cost of resources used in its construction and maintenance— the opportunity cost of stone masons, artists, and saver-investors whose human and physical capital resources were directed to the provision of religious services. By de-emphasizing cathedrals, Protestantism thus reduced a second kind of rent seeking. Figure 8.3 represents the cost inflation from cathedral building. MCrs lies above MCc, indicating that the cost inflation from spatially competitive cathedral building lies above the true competitive cost. As figure 8.3 reveals, the Protestant Reformation not only reduced rent seeking on the demand side of the church provision of services, but reduced rent seeking on the supply side of cathedral building as well, releasing EBCF in resources for private investment. Note that this is in addition to the freed up consumer surplus indicated earlier in figure 8.1.
Rent seeking due to spatial competition in cathedral building
Rent seeking due to spatial competition in cathedral building
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