School of Salamanca
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The School of Salamanca ( es, Escuela de Salamanca) is the
Renaissance The Renaissance ( , ) , from , with the same meanings. is a period in European history marking the transition from the Middle Ages to modernity and covering the 15th and 16th centuries, characterized by an effort to revive and surpass ide ...
of thought in diverse intellectual areas by
Spanish Spanish might refer to: * Items from or related to Spain: **Spaniards are a nation and ethnic group indigenous to Spain **Spanish language, spoken in Spain and many Latin American countries **Spanish cuisine Other places * Spanish, Ontario, Can ...
theologians Theology is the systematic study of the nature of the divine and, more broadly, of religious belief. It is taught as an academic discipline, typically in universities and seminaries. It occupies itself with the unique content of analyzing the s ...
, rooted in the intellectual and pedagogical work of
Francisco de Vitoria Francisco de Vitoria ( – 12 August 1546; also known as Francisco de Victoria) was a Spanish Roman Catholic philosopher, theologian, and jurist of Renaissance Spain. He is the founder of the tradition in philosophy known as the School of Sala ...
. From the beginning of the 16th century the traditional
Catholic The Catholic Church, also known as the Roman Catholic Church, is the largest Christian church, with 1.3 billion baptized Catholics worldwide . It is among the world's oldest and largest international institutions, and has played a ...
conception of man and of his relation to
God In monotheistic thought, God is usually viewed as the supreme being, creator, and principal object of faith. Swinburne, R.G. "God" in Honderich, Ted. (ed)''The Oxford Companion to Philosophy'', Oxford University Press, 1995. God is typically ...
and to the world had been assaulted by the rise of
humanism Humanism is a philosophical stance that emphasizes the individual and social potential and agency of human beings. It considers human beings the starting point for serious moral and philosophical inquiry. The meaning of the term "human ...
, by the
Protestant Reformation The Reformation (alternatively named the Protestant Reformation or the European Reformation) was a major movement within Western Christianity in 16th-century Europe that posed a religious and political challenge to the Catholic Church and i ...
and by the new geographical discoveries and their consequences. These new problems were addressed by the School of Salamanca. The name refers to the University of Salamanca, where de Vitoria and other members of the school were based. The juridical doctrine of the School of Salamanca represented the end of medieval concepts of law, with a revindication of
liberty Liberty is the ability to do as one pleases, or a right or immunity enjoyed by prescription or by grant (i.e. privilege). It is a synonym for the word freedom. In modern politics, liberty is understood as the state of being free within society fr ...
not habitual in Europe of that time. The natural rights of man came to be, in one form or another, the center of attention, including rights as a corporeal being (right to life, economic rights such as the right to own property) and spiritual rights (the right to
freedom of thought Freedom of thought (also called freedom of conscience) is the freedom of an individual to hold or consider a fact, viewpoint, or thought, independent of others' viewpoints. Overview Every person attempts to have a cognitive proficiency ...
and to human dignity). The School of Salamanca reformulated the concept of
natural law Natural law ( la, ius naturale, ''lex naturalis'') is a system of law based on a close observation of human nature, and based on values intrinsic to human nature that can be deduced and applied independently of positive law (the express enacte ...
: law originating in nature itself, with all that exists in the natural order sharing in this law. Their conclusion was, given that all humans share the same nature, they also share the same rights to life and liberty. Such views constituted a novelty in European thought and went counter to those then predominant in Spain and Europe that people indigenous to the Americas had no such rights.


History and leading figures

The School of Salamanca in the broad sense comprises two successive schools of thought, the largely Dominican Salmanticenses, then from the end of the 16th century the
Jesuit , image = Ihs-logo.svg , image_size = 175px , caption = ChristogramOfficial seal of the Jesuits , abbreviation = SJ , nickname = Jesuits , formation = , founders ...
Conimbricenses of the
University of Coimbra The University of Coimbra (UC; pt, Universidade de Coimbra, ) is a public research university in Coimbra, Portugal. First established in Lisbon in 1290, it went through a number of relocations until moving permanently to Coimbra in 1537. The u ...
, reflecting the general transition of intellectual leadership in the Catholic Church from the Dominicans to the Jesuits. The first school began with
Francisco de Vitoria Francisco de Vitoria ( – 12 August 1546; also known as Francisco de Victoria) was a Spanish Roman Catholic philosopher, theologian, and jurist of Renaissance Spain. He is the founder of the tradition in philosophy known as the School of Sala ...
(1483–1546), and reached its high point with
Domingo de Soto Domingo de Soto, O.P. (1494 – 15 November 1560) was a Spanish Dominican priest and Scholastic theologian born in Segovia ( Spain), and died in Salamanca ( Spain), at the age of 66. He is best known as one of the founders of international l ...
(1494–1560). Leading Conimbricenses were Luis de Molina (1535–1600),
Francisco Suárez Francisco Suárez, (5 January 1548 – 25 September 1617) was a Spanish Jesuit priest, philosopher and theologian, one of the leading figures of the School of Salamanca movement, and generally regarded among the greatest scholastics after Thoma ...
(1548–1617), and Giovanni Botero (1544–1617), who would continue the tradition in Italy. The leading figures of the school, theologians and jurists Francisco de Vitoria, Domingo de Soto, Francisco Suárez, Martín de Azpilcueta (or Azpilicueta), and Tomás de Mercado were all scholars of
natural law Natural law ( la, ius naturale, ''lex naturalis'') is a system of law based on a close observation of human nature, and based on values intrinsic to human nature that can be deduced and applied independently of positive law (the express enacte ...
and of
morality Morality () is the differentiation of intentions, decisions and actions between those that are distinguished as proper (right) and those that are improper (wrong). Morality can be a body of standards or principles derived from a code of co ...
, who undertook the reconciliation of the teachings of
Thomas Aquinas Thomas Aquinas, Dominican Order, OP (; it, Tommaso d'Aquino, lit=Thomas of Aquino, Italy, Aquino; 1225 – 7 March 1274) was an Italian Dominican Order, Dominican friar and Catholic priest, priest who was an influential List of Catholic philo ...
with the then new political-economic order. The themes of study centered on man and his practical problems (morality, economics, jurisprudence, etc.), but almost equally on a particular body of work accepted by all of them, as the ground against which to test their disagreements, including at times bitter polemics within the School.


Sovereignty

The School of Salamanca distinguished two realms of power, the natural or civil realm and the realm of the
supernatural Supernatural refers to phenomena or entities that are beyond the laws of nature. The term is derived from Medieval Latin , from Latin (above, beyond, or outside of) + (nature) Though the corollary term "nature", has had multiple meanings si ...
, which were often conflated in the
Middle Ages In the history of Europe, the Middle Ages or medieval period lasted approximately from the late 5th to the late 15th centuries, similar to the post-classical period of global history. It began with the fall of the Western Roman Empire ...
through granting royal control of
investiture Investiture (from the Latin preposition ''in'' and verb ''vestire'', "dress" from ''vestis'' "robe") is a formal installation or ceremony that a person undergoes, often related to membership in Christian religious institutes as well as Christian k ...
of bishops, or the temporal powers of the
pope The pope ( la, papa, from el, πάππας, translit=pappas, 'father'), also known as supreme pontiff ( or ), Roman pontiff () or sovereign pontiff, is the bishop of Rome (or historically the patriarch of Rome), head of the worldwide Cathol ...
. One direct consequence of the separation of realms of power is that the king or emperor does not legitimately have jurisdiction over
soul In many religious and philosophical traditions, there is a belief that a soul is "the immaterial aspect or essence of a human being". Etymology The Modern English noun '' soul'' is derived from Old English ''sāwol, sāwel''. The earliest att ...
s, nor does the pope have legitimate temporal power. This included the idea that there are limits on the legitimate powers of government. Thus, according to Luis de Molina a
nation A nation is a community of people formed on the basis of a combination of shared features such as language, history, ethnicity, culture and/or society. A nation is thus the collective identity of a group of people understood as defined by th ...
is analogous to the mercantile
corporation A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and ...
s of his time, in that those who govern are holders of power (effectively sovereigns) but a collective power, to which they are subject, derives from them jointly. Nonetheless, in de Molina's view, the power of society over the individual is greater than that of a mercantile corporation over its members, because the power of the government of a nation emanates from God's divine power (as against merely from the power of individuals
sovereign ''Sovereign'' is a title which can be applied to the highest leader in various categories. The word is borrowed from Old French , which is ultimately derived from the Latin , meaning 'above'. The roles of a sovereign vary from monarch, ruler or ...
over themselves in their business dealings). At this time, the
monarchy A monarchy is a form of government in which a person, the monarch, is head of state for life or until abdication. The political legitimacy and authority of the monarch may vary from restricted and largely symbolic ( constitutional monar ...
of
England England is a country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separated from continental Europe ...
was extending the theory of the
divine right of kings In European Christianity Christianity is an Abrahamic monotheistic religion based on the life and teachings of Jesus of Nazareth. It is the world's largest and most widespread religion with roughly 2.38 billion followers representin ...
—under which the monarch is the unique legatee of God's power—asserting that subjects must follow the monarch's orders, in order not to contravene God's design. Counter to this, several adherents of the School sustained that the ''
people A person ( : people) is a being that has certain capacities or attributes such as reason, morality, consciousness or self-consciousness, and being a part of a culturally established form of social relations such as kinship, ownership of prope ...
'' are the vehicle of divine
sovereignty Sovereignty is the defining authority within individual consciousness, social construct, or territory. Sovereignty entails hierarchy within the state, as well as external autonomy for states. In any state, sovereignty is assigned to the perso ...
, which they, in turn, pass to a prince under various conditions. In this, the late scholastics were instrumental in the development of early modern theories of political representation. Possibly the one who went furthest in this direction was Francisco Suárez, whose work ''Defensio Fidei Catholicae adversus Anglicanae sectae errores'' (''The Defense of the Catholic Faith against the errors of the
Anglican Anglicanism is a Western Christian tradition that has developed from the practices, liturgy, and identity of the Church of England following the English Reformation, in the context of the Protestant Reformation in Europe. It is one of t ...
sect'' 1613) was the strongest contemporary defense of
popular sovereignty Popular sovereignty is the principle that the authority of a state and its government are created and sustained by the consent of its people, who are the source of all political power. Popular sovereignty, being a principle, does not imply any ...
. Men are born free by their nature and not as slaves of another man, and can disobey even to the point of deposing an unjust government. As with de Molina, he affirms that political power does not reside in any individual, but he differs subtly in that he considers that the recipient of that power is the people as a whole, not a collection of sovereign individuals—in the same way,
Jean-Jacques Rousseau Jean-Jacques Rousseau (, ; 28 June 1712 – 2 July 1778) was a Genevan philosopher, writer, and composer. His political philosophy influenced the progress of the Age of Enlightenment throughout Europe, as well as aspects of the French Revolu ...
's theory of popular sovereignty would consider the people as a collective group superior to the sum that composes it. Gabriel Vázquez (1549–1604) held that natural law is not limited to the individual, but obliges societies to respect natural rights and justice. For Suárez, the political power of society is contractual in origin because the community forms by consensus of free wills. The consequence of this contractualist theory is that the natural form of government is either a
democracy Democracy (From grc, δημοκρατία, dēmokratía, ''dēmos'' 'people' and ''kratos'' 'rule') is a form of government in which the people have the authority to deliberate and decide legislation (" direct democracy"), or to choose g ...
or a republic, while
oligarchy Oligarchy (; ) is a conceptual form of power structure in which power rests with a small number of people. These people may or may not be distinguished by one or several characteristics, such as nobility, fame, wealth, education, or corporate ...
or
monarchy A monarchy is a form of government in which a person, the monarch, is head of state for life or until abdication. The political legitimacy and authority of the monarch may vary from restricted and largely symbolic ( constitutional monar ...
arise as secondary institutions, whose claim to justice is based on consent of the governed organized in a political body.


The law of peoples and international law

Francisco de Vitoria played an important role in the early modern comprehension of '' ius gentium'' (the rights of nations). He extrapolated his ideas of legitimate sovereign power to relations between nations, concluding that international society as well ought to be ruled by just forms respecting the rights of all. The common good of the world is of a category superior to the good of each state. This meant that relations between states ought to pass from being justified by force to being justified by law and right. Vitoria has been referred to, along with
Grotius Hugo Grotius (; 10 April 1583 – 28 August 1645), also known as Huig de Groot () and Hugo de Groot (), was a Dutch humanist, diplomat, lawyer, theologian, jurist, poet and playwright. A teenage intellectual prodigy, he was born in Delft ...
, as the “father of international law.” Francisco Suárez subdivided the concept of ''ius gentium''. Working with already well-formed categories, he carefully distinguished '' ius inter gentes'' from ''ius intra gentes''. Ius inter gentes (which corresponds to modern international law) was a just agreement among the majority of countries, although being
positive law Positive laws ( la, links=no, ius positum) are human-made laws that oblige or specify an action. Positive law also describes the establishment of specific rights for an individual or group. Etymologically, the name derives from the verb ''to posit ...
, not natural law, it was not necessarily universal. On the other hand, ''ius intra gentes'', or civil law, is specific to each nation. Many scholars have argued for the importance of Vitoria and Suárez as the forerunners and founders of the
International law International law (also known as public international law and the law of nations) is the set of rules, norms, and standards generally recognized as binding between states. It establishes normative guidelines and a common conceptual framework for ...
field, and the precursors of the seminal text '' De iure belli ac pacis'' by Grotius. Others, such as Koskenniemi, have argued that none of these humanist and scholastic thinkers can be understood to have founded international law in the modern sense, instead placing its origins in the post-1870 period.


Just war

Given that war is one of the worst evils suffered by mankind, the adherents of the School reasoned that it ought to be resorted to only when it was necessary to prevent an even ''greater'' evil. A diplomatic agreement is preferable, even for the more powerful party, before a war is started. Examples of "
just war The just war theory ( la, bellum iustum) is a doctrine, also referred to as a tradition, of military ethics which is studied by military leaders, theologians, ethicists and policy makers. The purpose of the doctrine is to ensure that a war i ...
" are: * In self-defense, as long as there is a reasonable possibility of success. If failure is a foregone conclusion, then it is just a wasteful spilling of blood. * Preventive war against a
tyrant A tyrant (), in the modern English usage of the word, is an absolute ruler who is unrestrained by law, or one who has usurped a legitimate ruler's sovereignty. Often portrayed as cruel, tyrants may defend their positions by resorting to ...
who is about to attack. * War to punish a guilty enemy. A war is not legitimate or illegitimate simply based on its original motivation: it must comply with a series of additional requirements: * It is necessary that the response be commensurate with the evil; use of more violence than is strictly necessary would constitute an unjust war. * Governing authorities ''declare'' war, but their decision is not sufficient cause to begin a war. If the ''people'' oppose a war, then it is illegitimate. The people have a right to depose a government that is waging, or is about to wage, an unjust war. * Once war has begun, there remain moral limits to action. For example, one may not attack innocents or kill hostages. * War is only legitimate as a last resort, after vigorous attempts at negotiation and diplomacy have failed. Under this doctrine, expansionist wars, wars of pillage, wars to convert
infidel An infidel (literally "unfaithful") is a person accused of disbelief in the central tenets of one's own religion, such as members of another religion, or the irreligious. Infidel is an ecclesiastical term in Christianity around which the Church ...
s or
pagans Pagans may refer to: * Paganism, a group of pre-Christian religions practiced in the Roman Empire * Modern Paganism, a group of contemporary religious practices * Order of the Vine, a druidic faction in the ''Thief'' video game series * Pagan's M ...
, and wars for glory are all inherently unjust.


The conquest of America

In the 16th century, the School of Salamanca was the first to use the natural law's principle that rights reside in the individual to question the Spanish colonization on the indigenous people of the Americas. Francisco de Vitoria began his analysis of conquest by rejecting "illegitimate titles". He was the first to dare to question whether the
bulls Bulls may refer to: *The plural of bull, an adult male bovine *Bulls, New Zealand, a small town in the Rangitikei District Sports *Bucking bull, used in the sport of bull riding * Bulls (rugby union), a South African rugby union franchise operated ...
of
Alexander VI Pope Alexander VI ( it, Alessandro VI, va, Alexandre VI, es, Alejandro VI; born Rodrigo de Borja; ca-valencia, Roderic Llançol i de Borja ; es, Rodrigo Lanzol y de Borja, lang ; 1431 – 18 August 1503) was head of the Catholic Chur ...
known collectively as the ''
Bulls of Donation The Bulls of Donation, also called the Alexandrine Bulls, and the Papal donations of 1493, are three papal bulls of Pope Alexander VI delivered in 1493 which granted overseas territories to Portugal and the Catholic Monarchs of Spain. A fourth ...
'' were a valid title of dominion over the newly discovered territories. In this matter he did not accept the universal primacy of the emperor, the authority of the pope (because the pope, according to him, lacked temporal power), nor the claim of voluntary submission or conversion of the Native Americans. One could not dismiss them as sinners or ignorant savages: they were free people by nature, with legitimate property rights. When the Spanish arrived in America they brought no legitimate title to occupy and rule those lands. Vitoria also analyzed whether there were legitimate claims of title over discovered lands. He elaborated up to eight legitimate titles of dominion. The first and perhaps most fundamental relates to communication between people, who jointly constitute a universal society. ''Ius peregrinandi et degendi'' is the universal right to travel and do commerce in all parts of the earth, independently of who governs or what is the religion of the territory. For him, if the "Indians" of the Americas would not permit free transit, the hindered parties had the right to defend themselves and to remain in land obtained in such a war of self-defense. The second form of legitimate title over discovered lands referred to the right of the Spanish to preach and proselytize. The Indians could voluntarily refuse conversion, but forbidding missionaries would make the matter analogous to the first case. Nonetheless, Vitoria noted that although this can be grounds for a just war, it is not necessarily prudent because of the resulting death and destruction. The other cases of this
casuistry In ethics, casuistry ( ) is a process of reasoning that seeks to resolve moral problems by extracting or extending theoretical rules from a particular case, and reapplying those rules to new instances. This method occurs in applied ethics and ju ...
are: * If the pagan sovereigns force converts to return to
idolatry Idolatry is the worship of a cult image or "idol" as though it were God. In Abrahamic religions (namely Judaism, Samaritanism, Christianity, the Baháʼí Faith, and Islam) idolatry connotes the worship of something or someone other than the ...
. * If there come to be a sufficient number of Christians in the newly discovered land that they wish to receive from the Pope a Christian government. * In the case of overthrowing a tyranny or a government that is harming innocents (e.g.
human sacrifice Human sacrifice is the act of killing one or more humans as part of a ritual, which is usually intended to please or appease gods, a human ruler, an authoritative/priestly figure or spirits of dead ancestors or as a retainer sacrifice, wherei ...
) * If associates and friends have been attacked—as were the
Tlaxcaltecas Tlaxcala ( 'place of maize tortillas') was a pre-Columbian city and state in central Mexico. During the Spanish conquest of the Aztec Empire, Tlaxcala allied with the Spanish Empire against the Aztecs, supplying a large contingent for and someti ...
, allied with the Spanish but subjected, like many other people, to the
Aztecs The Aztecs () were a Mesoamerican culture that flourished in central Mexico in the post-classic period from 1300 to 1521. The Aztec people included different ethnic groups of central Mexico, particularly those groups who spoke the Nahuatl ...
—once again, this could justify a war, with the ensuing possibility of legitimate conquest as in the first case. * The final "legitimate title" although qualified by Vitoria himself as doubtful, is the suffering of the foreign population from lack of just laws, magistrates, agricultural techniques, etc. In any case, title taken according to this principle must be exercised with Christian charity and for the advantage of the Indians. Emperor
Charles V Charles V may refer to: * Charles V, Holy Roman Emperor (1500–1558) * Charles V of Naples (1661–1700), better known as Charles II of Spain * Charles V of France (1338–1380), called the Wise * Charles V, Duke of Lorraine (1643–1690) * Infa ...
, then ruler of Spain, took offense to this doctrine of "legitimate" and "illegitimate" titles purporting to limit his prerogatives, and he tried without success to stop its promulgation.


Economics

The School of Salamanca has been described as the "first economic tradition" in the field of economics. This put the origins of economic theory on Europe's mainland, prompting a reassessment of the entire history of the discipline. Much attention has been drawn to the economic thought of the School of Salamanca by
Joseph Schumpeter Joseph Alois Schumpeter (; February 8, 1883 – January 8, 1950) was an Austrian-born political economist. He served briefly as Finance Minister of German-Austria in 1919. In 1932, he emigrated to the United States to become a professor at H ...
's ''History of Economic Analysis'' (1954). It did not coin, but certainly consolidated, the use of the term School of Salamanca in economics. Schumpeter studied scholastic doctrine in general and Spanish scholastic doctrine in particular, and praised the high level of economic science in Spain in the 16th century. He argued that the School of Salamanca most deserves to be considered the founders of economics as a science. The School did not elaborate a complete doctrine of economics, but they established the first modern economic theories to address the new economic problems that had arisen with the end of the medieval order. Unfortunately, there was no continuation of their work until the end of the 17th century and many of their contributions were forgotten, only to be rediscovered later by others. The thinking of the School was defined as "pro-market, pro-hard money, anti-state in many ways, pro-property, and pro-merchant to a surprising extent." The English historian of economic thought Marjorie Grice-Hutchinson and Belgian legal historian Wim Decock have published numerous articles and monographs on the School of Salamanca. Although there does not appear to be any direct influence, the economic thought of the School of Salamanca is in many ways similar to that of the
Austrian School The Austrian School is a heterodox school of economic thought that advocates strict adherence to methodological individualism, the concept that social phenomena result exclusively from the motivations and actions of individuals. Austrian scho ...
.
Murray Rothbard Murray Newton Rothbard (; March 2, 1926 – January 7, 1995) was an American economist of the Austrian School, economic historian, political theorist, and activist. Rothbard was a central figure in the 20th-century American libertarian ...
referred to them as ''proto-Austrians''.


Antecedents

In 1517, de Vitoria, then at the Sorbonne, was consulted by Spanish merchants based in
Antwerp Antwerp (; nl, Antwerpen ; french: Anvers ; es, Amberes) is the largest city in Belgium by area at and the capital of Antwerp Province in the Flemish Region. With a population of 520,504,
about the moral legitimacy of engaging in commerce to increase one's personal wealth. From today's point of view, one would say they were asking for a consultation about the
entrepreneurial Entrepreneurship is the creation or extraction of economic value. With this definition, entrepreneurship is viewed as change, generally entailing risk beyond what is normally encountered in starting a business, which may include other values th ...
spirit. Beginning at that time, Vitoria and other theologians looked at economic matters. They moved away from views that they found to be obsolete, adopting instead new ideas based on principles of natural law. According to these views, the natural order is based in the "freedom of circulation" of people, goods, and ideas, allowing people to know one another and increase their sentiments of brotherhood. This implies that merchantry is not merely not reprehensible, but that it actually serves the general good.


Private property

The adherents of the School of Salamanca all agreed that property has the beneficial effect of stimulating economic activity, which, in turn, contributed to the general well being. Diego de Covarubias y Leyva (1512–1577) considered that people had not only the right to own property but—again, a specifically modern idea—they had the exclusive right to the benefit from that property, although the community might also benefit. Nonetheless, in times of great necessity, there, all goods become a
commons The commons is the cultural and natural resources accessible to all members of a society, including natural materials such as air, water, and a habitable Earth. These resources are held in common even when owned privately or publicly. Commons c ...
. Luis de Molina argued that individual owners take better care of their goods than is taken of common property, a form of the
tragedy of the commons Tragedy (from the grc-gre, τραγῳδία, ''tragōidia'', ''tragōidia'') is a genre of drama based on human suffering and, mainly, the terrible or sorrowful events that befall a main character. Traditionally, the intention of tragedy i ...
.


Money, value, and price

The most complete and methodical developments of a Salamancan theory of value were by Martín de Azpilcueta (1493–1586) and Luis de Molina. Interested in the effect of
precious metals Precious metals are rare, naturally occurring metallic chemical elements of high economic value. Chemically, the precious metals tend to be less reactive than most elements (see noble metal). They are usually ductile and have a high lu ...
arriving from the Americas, de Azpilcueta proved that in the countries where precious metals were scarce, prices for them were higher than in those where they were abundant. Precious metals, like any other mercantile good, gained at least some of their value from their scarcity. This scarcity theory of value was a precursor of the quantitative theory of money put forward slightly later by
Jean Bodin Jean Bodin (; c. 1530 – 1596) was a French jurist and political philosopher, member of the Parlement of Paris and professor of law in Toulouse. He is known for his theory of sovereignty. He was also an influential writer on demonology. Bo ...
(1530–1596). Up until that time, the predominant theory of value had been the medieval theory based on the cost of production as the sole determinant of a
just price The just price is a theory of ethics in economics that attempts to set standards of fairness in transactions. With intellectual roots in ancient Greek philosophy, it was advanced by Thomas Aquinas based on an argument against usury, which in his ...
(a variant of the
cost-of-production theory of value In economics, the cost-of-production theory of value is the theory that the price of an object or condition is determined by the sum of the cost of the resources that went into making it. The cost can comprise any of the factors of production (incl ...
, most recently manifested in the
labor theory of value The labor theory of value (LTV) is a theory of value that argues that the economic value of a good or service is determined by the total amount of " socially necessary labor" required to produce it. The LTV is usually associated with Marxian ...
). Diego de Covarrubias and Luis de Molina developed a
subjective theory of value The subjective theory of value is an economic theory which proposes the idea that the value of any good is not determined by the utility value of the object, nor by the cumulative value of components or labour needed to produce or manufacture it, ...
and prices, which asserted that the usefulness of a good varied from person to person, so just prices would arise from mutual decisions in free commerce, barring the distorting effects of
monopoly A monopoly (from Greek language, Greek el, μόνος, mónos, single, alone, label=none and el, πωλεῖν, pōleîn, to sell, label=none), as described by Irving Fisher, is a market with the "absence of competition", creating a situati ...
, fraud, or government intervention. Expressing this in today's terms, the adherents of the School defended the
free market In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any ot ...
, where the fair price of a good would be determined by
supply and demand In microeconomics, supply and demand is an economic model of price determination in a Market (economics), market. It postulates that, Ceteris paribus, holding all else equal, in a perfect competition, competitive market, the unit price for a ...
. On this Luis Saravia de la Calle wrote in 1544:
Those who measure the just price by the labour, costs, and risk incurred by the person who deals in the merchandise or produces it, or by the cost of transport or the expense of traveling...or by what he has to pay the factors for their industry, risk, and labour, are greatly in error.... For the just price arises from the abundance or scarcity of goods, merchants, and money...and not from costs, labour, and risk.... Why should a bale of linen brought overland from Brittany at great expense be worth more than one which is transported cheaply by sea?... Why should a book written out by hand be worth more than one which is printed, when the latter is better though it costs less to produce?... The just price is found not by counting the cost but by the common estimation.
However the school rarely followed this idea through systematically, and, as
Friedrich Hayek Friedrich August von Hayek ( , ; 8 May 189923 March 1992), often referred to by his initials F. A. Hayek, was an Austrian–British economist, legal theorist and philosopher who is best known for his defense of classical liberalism. Hayek ...
has written, "never to the point of realizing that what was relevant was not merely man's relation to a particular thing or a class of things but the position of the thing in the whole...scheme by which men decide how to allocate the resources at their disposal among their different endeavors."


Interest on money

Usury Usury () is the practice of making unethical or immoral monetary loans that unfairly enrich the lender. The term may be used in a moral sense—condemning taking advantage of others' misfortunes—or in a legal sense, where an interest rate is c ...
(which in that period meant ''any'' charging of
interest In finance and economics, interest is payment from a borrower or deposit-taking financial institution to a lender or depositor of an amount above repayment of the principal sum (that is, the amount borrowed), at a particular rate. It is distin ...
on a
loan In finance, a loan is the lending of money by one or more individuals, organizations, or other entities to other individuals, organizations, etc. The recipient (i.e., the borrower) incurs a debt and is usually liable to pay interest on that ...
) has always been viewed negatively by the Catholic Church. The
Third Lateran Council The Third Council of the Lateran met in Rome in March 1179. Pope Alexander III presided and 302 bishops attended. The Catholic Church regards it as the eleventh ecumenical council. By agreement reached at the Peace of Venice in 1177 the bitter ...
condemned any repayment of a debt with more money than was originally loaned; the
Council of Vienne The Council of Vienne was the fifteenth ecumenical council of the Roman Catholic Church and met between 1311 and 1312 in Vienne, France. One of its principal acts was to withdraw papal support for the Knights Templar at the instigation of Phil ...
explicitly prohibited usury and declared any legislation tolerant of usury to be heretical; the first scholastics reproved the charging of interest. In the
medieval economy It has been estimated that throughout prehistory, the world average GDP per capita was about $158 per annum (adjusted to 2013 dollars), and did not rise much until the Industrial Revolution. The first object or physical thing specifically used i ...
, loans were entirely a consequence of necessity (bad harvests, fire in a workplace) and, under those conditions, it was considered morally reproachable to charge interest. In the
Renaissance The Renaissance ( , ) , from , with the same meanings. is a period in European history marking the transition from the Middle Ages to modernity and covering the 15th and 16th centuries, characterized by an effort to revive and surpass ide ...
era, greater mobility of people facilitated an increase in commerce and the appearance of appropriate conditions for
entrepreneur Entrepreneurship is the creation or extraction of economic value. With this definition, entrepreneurship is viewed as change, generally entailing risk beyond what is normally encountered in starting a business, which may include other values t ...
s to start new, lucrative businesses. Given that borrowed money was no longer strictly for consumption but for production as well, it could not be viewed in the same manner. The School of Salamanca elaborated various reasons that justified the charging of interest. The person who received a loan benefited; one could consider interest as a premium paid for the risk taken by the loaning party. There was also the question of
opportunity cost In microeconomic theory, the opportunity cost of a particular activity is the value or benefit given up by engaging in that activity, relative to engaging in an alternative activity. More effective it means if you chose one activity (for example ...
, in that the loaning party lost other possibilities of utilizing the loaned money. Finally, and perhaps most originally, was the consideration of ''money itself'' as a merchandise, and the use of one's money as something for which one should receive a benefit in the form of interest. Martín de Azpilcueta also considered the effect of time, formulating the
time value of money The time value of money is the widely accepted conjecture that there is greater benefit to receiving a sum of money now rather than an identical sum later. It may be seen as an implication of the later-developed concept of time preference. The ...
. All things being equal, one would prefer to receive a given good now rather than in the future. This
preference In psychology, economics and philosophy, preference is a technical term usually used in relation to choosing between alternatives. For example, someone prefers A over B if they would rather choose A than B. Preferences are central to decision th ...
indicates greater value. Interest, under this theory, is the payment for the time the loaning individual is deprived of the money.


Theology

In the Renaissance era, theology was generally declining in the face of the rise of
humanism Humanism is a philosophical stance that emphasizes the individual and social potential and agency of human beings. It considers human beings the starting point for serious moral and philosophical inquiry. The meaning of the term "human ...
, with
scholasticism Scholasticism was a medieval school of philosophy that employed a critical organic method of philosophical analysis predicated upon the Aristotelian 10 Categories. Christian scholasticism emerged within the monastic schools that translat ...
becoming nothing more than an empty and routine methodology . Under Francisco de Vitoria, the University of Salamanca led a period of intense activity in theology, especially a renaissance of
Thomism Thomism is the philosophical and theological school that arose as a legacy of the work and thought of Thomas Aquinas (1225–1274), the Dominican philosopher, theologian, and Doctor of the Church. In philosophy, Aquinas' disputed questions ...
, whose influence extended to European culture in general, but especially to other European universities. Perhaps the fundamental contribution of the School of Salamanca to theology is the study of problems much closer to humanity, which had previously been ignored, and the opening of questions that had previously not been posed. The term ''positive theology'' is sometimes used to distinguish this new, more practical, theology from the earlier ''scholastic theology''.


Morality

In an era when
religion Religion is usually defined as a social- cultural system of designated behaviors and practices, morals, beliefs, worldviews, texts, sanctified places, prophecies, ethics, or organizations, that generally relates humanity to supernatur ...
permeated everything, to analyze the morality of the acts was considered the most practical and useful study one could undertake to serve society. The novel contributions of the School in law and economics were rooted in concrete challenges and moral problems which confronted society under new conditions. Over the years a
casuistry In ethics, casuistry ( ) is a process of reasoning that seeks to resolve moral problems by extracting or extending theoretical rules from a particular case, and reapplying those rules to new instances. This method occurs in applied ethics and ju ...
, a fixed set of answers to moral dilemmas, had been developed. However, by its nature, a casuistry can never be complete, leading to a search for more general rules or principles. From this developed
probabilism In theology and philosophy, probabilism (from Latin ''probare'', to test, approve) is an ancient Greek doctrine of Academic skepticism. It holds that in the absence of certainty, plausibility or truth-likeness is the best criterion. The term can a ...
, where the ultimate criterion was not truth, but the certainty of not choosing evil. Developed principally by
Bartolomé de Medina Bartolomé may refer to: Places * Bartolomé Island (Spanish: Isla Bartolomé), a volcanic islet in the Galápagos Islands Group * Isla Bartolomé, Diego Ramirez Islands, Chile People * Bartolomé Bermejo (c.1440–c.1501), Spanish painter * Barto ...
and continued by Gabriel Vázquez and Francisco Suárez, Probabilism became the most important school of moral thought in the coming centuries.


The ''De auxiliis'' controversy

The ''De auxiliis'' controversy was a dispute between Jesuits and Dominicans which occurred at the end of the 16th century. The topic of the controversy was
grace Grace may refer to: Places United States * Grace, Idaho, a city * Grace (CTA station), Chicago Transit Authority's Howard Line, Illinois * Little Goose Creek (Kentucky), location of Grace post office * Grace, Carroll County, Missouri, an uninc ...
and
predestination Predestination, in theology, is the doctrine that all events have been willed by God, usually with reference to the eventual fate of the individual soul. Explanations of predestination often seek to address the paradox of free will, whereby ...
, that is to say how one could reconcile the
liberty Liberty is the ability to do as one pleases, or a right or immunity enjoyed by prescription or by grant (i.e. privilege). It is a synonym for the word freedom. In modern politics, liberty is understood as the state of being free within society fr ...
or
free will Free will is the capacity of agents to choose between different possible courses of action unimpeded. Free will is closely linked to the concepts of moral responsibility, praise, culpability, sin, and other judgements which apply only to ac ...
of humans with divine
omniscience Omniscience () is the capacity to know everything. In Hinduism, Sikhism and the Abrahamic religions, this is an attribute of God. In Jainism, omniscience is an attribute that any individual can eventually attain. In Buddhism, there are dif ...
. In 1582 the Jesuit Prudencio Montemayor and Fray
Luis de León Luis de León ( Belmonte, Cuenca, 1527 – Madrigal de las Altas Torres, Castile, Spain, 23 August 1591), was a Spanish lyric poet, Augustinian friar, theologian and academic, active during the Spanish Golden Age. Early life Luis d ...
spoke publicly about human liberty. Domingo Báñez considered that they gave free will too great a weight and that they used terminology that sounded heretical; he denounced them to the
Spanish Inquisition The Tribunal of the Holy Office of the Inquisition ( es, Tribunal del Santo Oficio de la Inquisición), commonly known as the Spanish Inquisition ( es, Inquisición española), was established in 1478 by the Catholic Monarchs, King Ferdinand ...
, accusing them of
Pelagianism Pelagianism is a Christian theological position that holds that the original sin did not taint human nature and that humans by divine grace have free will to achieve human perfection. Pelagius ( – AD), an ascetic and philosopher from t ...
, a belief in human free will to the detriment of the doctrine of
original sin Original sin is the Christian doctrine that holds that humans, through the fact of birth, inherit a tainted nature in need of regeneration and a proclivity to sinful conduct. The biblical basis for the belief is generally found in Genesis 3 ...
and the grace granted by God. Montemayor and de León were banned from teaching and prohibited from defending such ideas. Báñez was then denounced to the Holy Office by Leon, who accused him of "committing the error of Lutheranism", that is of following the doctrines of
Martin Luther Martin Luther (; ; 10 November 1483 – 18 February 1546) was a German priest, theologian, author, hymnwriter, and professor, and Augustinian friar. He is the seminal figure of the Protestant Reformation and the namesake of Lutherani ...
. According to Lutheran doctrine, man is "dead in his trespasses" (Ephesians 2:1) as a consequence of original sin and cannot save himself by his own merit; only God can save man, "For by grace you have been saved through faith. And this is not your own doing; it is the gift of God, not a result of works, so that no one may boast." (Ephesians 2:8–9) Báñez was acquitted. Nonetheless, this did not end the dispute, which Luis de Molina continued with his ''Concordia liberi arbitrii cum gratiae donis'' (1588). This is considered the best expression of the Jesuit position. The polemic continued over the course of years, including an attempt by the Dominicans to get
Pope Clement VIII Pope Clement VIII ( la, Clemens VIII; it, Clemente VIII; 24 February 1536 – 3 March 1605), born Ippolito Aldobrandini, was head of the Catholic Church and ruler of the Papal States from 2 February 1592 to his death in March 1605. Born ...
to condemn the ''Concordia'' of de Molina. Finally
Paul V Pope Paul V ( la, Paulus V; it, Paolo V) (17 September 1550 – 28 January 1621), born Camillo Borghese, was head of the Catholic Church and ruler of the Papal States from 16 May 1605 to his death in January 1621. In 1611, he honored ...
in 1607 recognized the liberty of Dominicans and Jesuits to defend their ideas, prohibiting that either side of this disagreement be characterized as heresy.


The existence of evil in the world

The existence of evil in a world created and ruled by an infinitely good and powerful God has long been viewed as paradoxical. (See
Problem of evil The problem of evil is the question of how to reconcile the existence of evil and suffering with an omnipotent, omnibenevolent, and omniscient God.The Stanford Encyclopedia of Philosophy,The Problem of Evil, Michael TooleyThe Internet Encyc ...
). Vitoria reconciled the paradox by arguing first that free will is a gift from God to each person. It is impossible that each person will always freely choose only the good. Thus, evil results from man's ability not to choose good, by virtue of his free will.


See also

* Conimbricenses * Second scholasticism *
Casuistry In ethics, casuistry ( ) is a process of reasoning that seeks to resolve moral problems by extracting or extending theoretical rules from a particular case, and reapplying those rules to new instances. This method occurs in applied ethics and ju ...
* Rule According to Higher Law *
Social contract In moral and political philosophy, the social contract is a theory or model that originated during the Age of Enlightenment and usually, although not always, concerns the legitimacy of the authority of the state over the individual. Social ...
* Valladolid debate * Spanish Universalist School of the 18th century


References


Bibliography

* Alves, André Azevedo (2010). ''The Salamanca School (Major Conservative and Libertarian Thinkers)'', edited by John Meadowcroft, Continuum International Publishing. * * Chojnowski, Peter (January 2005)
'Corporation Christendom': The True School of Salamanca
. ''The Angelus'' XXVIII (1). Kansas City, MO: Angelus Press. . Contends that the alleged
economic liberalism Economic liberalism is a political and economic ideology that supports a market economy based on individualism and private property in the means of production. Adam Smith is considered one of the primary initial writers on economic libera ...
is based on a misreading of scholastic texts. * Grice-Hutchinson, Marjorie (1952).
The School of Salamanca: Readings in Spanish Monetary Theory, 1544–1605
' * Grice-Hutchinson, Marjorie (1978). ''Early Economic Thought in Spain, 1177–1740''. * Grice-Hutchinson, Marjorie (1993). ''Economic thought in Spain. Selected Essays of Marjorie Grice-Hutchinson'', edited with an introduction by Laurence Moss and Christopher K. Ryan. * Liggio, Leonard P. (Jan & Feb 2000)
The Heritage of the Spanish Scholastics
. ''Religion & Liberty''. 10 (1). Grand Rapids, MI:
Acton Institute The Acton Institute for the Study of Religion and Liberty is an American research and educational institution, or think tank, in Grand Rapids, Michigan, (with an office in Rome) whose stated mission is "to promote a free and virtuous society c ...
. * *
Rothbard, Murray Murray Newton Rothbard (; March 2, 1926 – January 7, 1995) was an American economist of the Austrian School, economic historian, political theorist, and activist. Rothbard was a central figure in the 20th-century American libertarian m ...

New Light on the Prehistory of the Austrian School
Essay originally published in ''The Foundations of Modern Austrian Economics'', edited by Edwin Dolan (Kansas City: Sheed and Ward, 1976), pp. 52–74. * Schumpeter, Joseph (1954). ''History of Economic Analysis''. New York: Oxford University Press. * : Puts into context of truce negotiations 1608–1809. Ittersum (p. 18) notes Grotius' citing of School of Salamanca figures, as well as the Ancient Greek, Roman and early Church Fathers (p. 12). *


External links


The School of Salamanca
A Digital Collection of Sources and a Dictionary of its Juridical-Political Language. *
The School of Salamanca
on the History of Economic Thought website. {{DEFAULTSORT:School Of Salamanca Ethical schools and movements Economic history of Spain History of Catholicism in Spain Scholasticism Preclassical economics Legal history of Spain Thomas Aquinas Popular sovereignty University of Salamanca