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The Wheels of Commerce (Civilization and Capitalism: 15Th-18th Century -Volume 2)

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Historians, they say, are either lumpers or splitters: the former seek to make generalizations while the latter seek to refute and refine them. Braudel strikes a balance between these approaches, at one time examining the economic point of view (and related theoretical controversies, such as the ideas of Schumpeter on innovation), while searching for historical examples that support or obliterate them. He is a true master scholar.

This volume adds to the first, moving from living standards to the establishment and functioning of trading and banking systems, both by capitalists (holders of sufficient resources to manipulate markets) and the merchants and craftsmen who operated within these markets. It is a crucial distinction that demonstrates how simple-minded the ideological argument of "free markets" can be: the rich can and do design economic systems to function to their advantage. You follow the development of international trading networks by Italians, Jews and Armenians; the evolution of banking and the handling of paper money; and even the influence of social hierarchies on economic growth.

While Braudel concentrates almost exclusively on Europe in this volume, which lessens the universality of his approach, it is utterly fascinating from page one. The economic systems he analyses were somewhat incomplete, though evolving rapidly. An additional limit to his approach is the exclusive focus on econimic life. At times, he views the building of chateaux and the commission of great works of art from the Reanassance to the 19C as a reflection of the lack of wealth-generating investment opportunities during a time of economic revolution!

And that is just a few of the issues covered. Each section of the book is like an essay on some basic economic notion. As such, the book assumes a great deal of historical knowledge in the reader, though Braudel often explains what he refers to briefly. For me, this added to its appeal and density, but it is often hard going. However, the book is leavened by wonderful and fascinating illustrations, which eases the task of getting through it at times.

Highly recommended.

In The Wheels of Commerce, Fernand Braudel deftly blended history and economics with the result that neither suffers. His goal in this book, the second volume in his Civilization and Capitalism, 15th-18th Century, was "to analyse the machinery of exchange as a whole, from primitive barter up to and including the most sophisticated capitalism" (21). In the process of examining this machinery of exchange, Braudel also proposed an ambitious thesis concerning the origins of capitalism. The book itself is a monumental work, an impressive combination of statistical analyses and illustrations from primary sources.

Braudel's first two chapters, "The Instruments of Exchange" and "Markets and the Economy," investigated the role of circulation. In chapter one, he concentrated on the mechanisms by which goods (and money) were traded. Braudel explained that markets and shops were at the bottom of the world of commerce. Markets took place once or twice a week, and shops were open everyday. Fairs, the wholesale markets, were on the higher level. Participants traded large amounts of goods and settled their accounts at the end. Braudel pointed out the importance of fairs in the development of capitalism: "The fair itself created credit" (91). If one merchant had a negative trade balance with another merchant, he would either offer a bill of exchange (a promise of payment on another exchange) or defer payment with interest until another fair. Additionally, these bills of exchange could be sold to a third party if necessary, introducing speculation. The trading mechanisms of the fair were eventually consolidated into the large exchanges of cities like Amsterdam and London, and eventually these exchanges grew into the stock markets. Chapter two investigated the manner in which merchants engaged in trade. Braudel stressed the importance of trading circuits and the use of paper (especially in the form of bills of exchange) for profitability. One of the key ideas in this chapter is the role of distance on price. Price was not set solely by supply and demand, but was also affected by the distance the product had to travel. His insight into system was helpful. "Any capitalist market has a series of links in a chain, and somewhere near the middle there is a point higher and more remunerative than the rest" (193).

The next two chapters, "Capitalism Away from Home" and "Capitalism on Home Ground," dealt primarily with issues regarding production. Chapter three dealt with what could be considered the lower world of production. One of the key issues that Braudel explicated was the role of fixed and circulating capital. The fixed capital that was invested in production was tied up in equipment and other items, while the circulating capital was more liquid and included wages. Braudel also investigated the role of land in production and capitalism, noting: "The great landowner was not a capitalist, but he was a tool and a collaborator in the service of capitalism" (271). He also focused on the peculiarities of production in these pre-industrial years. In chapter four, Braudel investigated the higher world of production. His explanation of the development of banking practices, which would fund production, was illuminating, as was his discussion on the development of companies from private family business to joint stock companies.

Though the book focused on capitalism's development in Europe, Braudel integrated discussions on other geographical locales as well. Braudel did not present Europe as arriving at its capitalist system in a vacuum. He noted the role that other cultures had in aiding the formation of the European model, not just through trade, but also through Europe's adoption of foreign innovation. However, Braudel surprisingly downplayed the importance of double-entry book-keeping to the emergence of capitalism. He asserted that the practice did not spread quickly and was not universally adopted, giving notable examples (574).
Even though successful merchants were found all over the world during this time period (especially in Islamic lands that provided them with a favorable status), full-blown capitalism developed first in Europe. Braudel attempted to provide an explanation as to why this was the case. His thesis regarding this matter is the raison d'tre of the book. Braudel believed that three conditions were necessary for the emergence of capitalism. The first was a "vigorous and expanding market economy" (600). Braudel noted that many regions fulfilled this qualification. The second necessity, which hindered many prime candidates, was a strong hierarchy was necessary. This hierarchy encouraged the accumulation of wealth. Landed positions were not hereditary in India, China, and Islamic lands making the nobility's position precarious and the accumulation of wealth difficult. Braudel only mentioned two areas that fulfilled these first two necessities: Europe and Japan. However, Japan closed herself off to world trade, the third necessity. Braudel noted, "Long-distance trading ... was the only doorway to a superior profit level" (601). Braudel's case is a compelling one that must be addressed by anyone investigating this topic.

The Wheels of Commerce is immense, but immensely readable. Braudel portrayed for his reader a heady, exciting Europe, one in which the prime goal was to spend money faster than it could be made. However, even during his descriptions of the dizzying pace at which money was circulated, Braudel did not lose sight of his objective. His scope was large, but he remained precise in both style and purpose, obviating the befuddlement of the layperson (which I confess to being). The book is a balanced work, exhibiting a variety of historical methods. Braudel made extensive use of statistics and mathematical models (the book contains a plethora of charts and tables), but he also included numerous narratives regarding business practices of the time (demonstrating an astonishing knowledge of the primary sources). Because of the attention with which he supported his claims, historians of all stripes can admire this book.

Finally, the student of economic history should not overlook one of the finer aspects of The Wheels of Commerce. This book contains over 120 excellent illustrations from the 15th-18th centuries. The pictures, which vary from woodblock prints to oil paintings, depict the lives of those involved in commerce at the time. Not only do the abundant illustrations make this book a more attractive read, but also they provide the book with a certain level of completeness, giving the reader more tools by which he or she can comprehend the emergence of capitalism in Europe

There are various pretenders to the throne of explaining globalization, such as Thomas Friedman's recent The World Is Flat, but all such efforts seem shallow and pallid compared to the masterwork of the genre, Fernamd Braudel's trilogy Civilization & Capitalism, 15th - 18th Century (The Structures of Everyday Life (Volume 1), The Wheels of Commerce (Volume 2)
and The Perspective of the World (Volume 3)

I do not lightly suggest tackling almost 1,800 pages of reading, but there is simply no substitute (short of a master's degree) if you aspire to a true understanding of global trade's role in the social, political and economic history of our world. It is not a boring read--anything but, for Braudel's depth of research, breadth of knowledge and his appreciation for the limits of current scholarship are matchless. Where authors like Friedman incautiously grind whatever axe they set out, drawing upon work which supports their thesis, Bruadel is ever-cautious about drawing hard-and-fast conclusions from the data he has culled from archives' dusty pages.

What Braudel reveals is a world which has been disrupted by far-reaching trade for hundreds of years. Capital has flowed across the great oceans of our globe for far longer than most people realize, destroying local industries in favor of distant ones in the process. It is impossible to summarize such a rich, vast work, but reading even one of these volumes will give you a deep insight into the long history of globalization, and how entire industries and financial centers have been displaced time and again in the Arab Levant, in Asia, and in Europe. You will also come to understand the rise of European economic dominance, and how it cannot be so neatly attributed to guns, steel and germs, as appealing and powerful as Jared Diamond's thesis may be.

Braudel does not work to create over-arching explantions so much as present the archival facts he so assiduously assembled. (The books were written in the late 1970s; Braudel died in 1985 at the age of 83.) For example, he shows that prosperity, since at least the 1400s if not earlier, is inevitably found in those cities and regions where prices are highest. It is counter-intuitive at first--since shouldn't money go farther where prices are low?-- but the same is obviously true of our era. The most prosperous nations are those with the highest costs, and the poorest are those where prices are lowest.

At a minimum, this sheds light on the centuries-old exodus from rural to metropolis, and on the nature of prosperity itself. I recommend these volumes not just for their vast erudition but for the enjoyment gained from his unparalleled mastery of everyday life in distant lands and distant times. Not much has changed, it seems, except the speed of the ships and the communication between traders.

Braudel's second volume is the most detailed history of the origin of banking, stock markets and stocks and bonds. The Genoese bankers as the catalysts for world discovery and world trade put history in a new perspective.

Wow, by far one of the best books that I have ever read. I usually do not like history because I prefer to be more proactive and immersed in today's world. But the clarity on our society's current situation that this book gives by examining the roots of the movement to capitalism is incredible and was so worth my time that I had to take a week's vacation off work in order to make sure that I could focus to read this. The writing conveys only one thing - complete clarity into the world today. It is an incredible opus; I loved it.

There is no easy answer to the challenges we humans face in organizing and creating a shared activity to enable the greatest overall productivity and happiness. The evolution of humanity during the early Renaissance years provides the explanation for where and why we are organized in this way today. Understanding this time in this way (through the lens of the economics of that time period) gives a much greater appreciation for the world today that we have constructed. The most core problems of humanity - social mobility, equitable distribution of resources, stability, and collective cooperation, have never (and may never) become solvable. This book explains these dynamics so eloquently that I wish I had time to read it again and again - much like a great adventure novel that as a kid you just wished would never end and felt a real loss once it did and you had to re-emerge into the real world around you.

Braudel is phenomenal in his depth of understanding about how society of the 15-18th centuries operated. I can't recommend it more highly.

Braudels history of Commerce paints a vivid picture of how commerce has evolved. It is uniquely relative information for all individuals interested in creating wealth. As it deals how others marketed their goods and services in the past. The presentation of the information in the book is first-class. I am now rereading the book for the fourth time....

I don't even LIKE history or economics...but I love this book.

In the course of researching some historical background for an English Lit paper, I ran across two of Braudel's books -- this was one of them.

It was so fascinating that I read the entire book (even though what I needed for the paper was a few pages); and then I went ahead and bought my own copy, plus others by this author.

In the first volume of this series, Braudel sets the stage for life and commerce in the period under discussion. Volume two of Civilization and Capitalism really gets the ball rolling. Or as much as anything ever gets rolling in a Braudel book.

This is fascinating stuff. But it is not easy going. The language is straight forward, but Braudel wanders around his subject, giving us mountains of specifics and following various side currents to their ends. The basic point of the volume is to outline, first, the difference between the market and capitalism, and then to trace the creation of capitalism in the markets centers of Europe between the 15th and 18th centuries.

Unlike many historian of this period, Braudel is more concerned with the world of finance than the world of production, which I find fascinating and innovative. If you care to know how the financiers of Amsterdam dealt with getting a ship in the ocean and bound for America or India, this is the place to look.

While not being an economic determinist, economics is at the center Braudel's work. Unlike many other economic historians, Braudel does take the time to deal with how culture (there a section on fashion in the first volume!) religion and other factors play into the shaping of an economic and social system. This makes for a deeply convincing argument when he demolishes Weber's idea of the protestant work ethic, but is less informed or convincing (and sometimes borderline racist) when he is dealing with non-western cultures.

I appreciate that Braudel didn't assume that by "civilization and capitalism" one can only mean Western Europe, but his sections on the rest of the world I found lacking. They did not have the erudition he exhibits when taking about Western Europe.

I found the book fascinating, but I think Braudel could have done with some editing. This book is not going to lay out point by point the creation of capitalism for you. You'll need to discover the steps through the examples Braudel gives. It's riveting if you're an econ and history nerd, but complicated and meandering work, which could have used a co-author (or a better team of research assistants) to handle the non western areas he covers and a editor to tease out the string of the creation of capitalism that subtly floats through this work.

This was the most interesting, to me, of Braudel's classic three-volume history of the age when vernacular culture first faced off against the predecessors of industrial culture. I dive into these books periodically and surface several hours later, having gone back in time.

This is the second volume of Braudel¡¯s ¡®Civilization and Capitalism¡¯. The second volume deals with the market economy, while the first volume, ¡®Structures of Everyday Life¡¯ takes on infra-economy or material civilization. As I said on the review of the first volume, in the pre-industrialized societies, the market system is not the only form of resource allocation. The material civilization is the first layer of economy on the bottom, the market system is the second layer located above the first layer. The exchange or commerce was not natural economy but artificial economy in the jargon of the 18th C economics: Market is premised on the separation of production and consumption. Such a division is not natural, but is developed over long time. In this vein, the market is not natural at all. The market is the point in which material life and economic life meet each other. The market is the network. It links region to region, national economy to national economy. The form and scope of market has been evolved over time. When we track the forms of market, we could paint the history of capitalism. Nonetheless, Capitalism is often regarded as synonymous to market economy. But market is not unique to capitalism. But it goes without saying that capitalism can¡¯t exist without market. All economic activities under capitalism are carried out on the market. Changes in the form of market signals the changes of capitalism. When, for example, we talk about globalization, we have in mind the change of market based on national economy to global market. The second volume is about the topology of market. Based on the scope of space the market serves, we could trace out the path of capitalism since the 15th C. But market is not capitalism. To understand this point, you¡¯d better check the third volume, ¡®The Perspective of the World¡¯.