PAWNING

PAWNING. Pawning is the practice of taking a loan against an item of greater value than the amount of the loan. The lender may sell the item at the end of the loan's term if the borrower, whether deliberately or not, fails to repay both the principal and interest. Literary references testify to the importance of pawning in early modern Europe: in Shakespeare's King Henry IV, Part Two (1598), Falstaff, faced with arrest for a bad debt, tries to persuade Mistress Quickly to pawn her plate and tapestries on his behalf.

Through the fourteenth century, Christians, charging up to 80 percent interest per annum, dominated pawnbroking. Increasingly seen as usurious and subsequently prohibited by bankers' guilds, licensed pawnbroking in much of Europe became identified with Jews by the fifteenth century. Typical contracts between Jewish lenders and local authorities exacted a tax in exchange for the right to open pawnshops, and regulated interest rates: 20 percent in Rome, 15 percent in Venice. The perception that pawnbroking exploited poor Christians contributed to the debasement of Jews and sometimes sparked anti-Semitic outbursts, as in Frankfurt in 1614.

In mid-fifteenth-century Italy, Franciscans began advocating monti di pietà —charitable public pawnshops offering low-interest loans to the poor, displacing the Jews and their pawnbroking. The first monte was established in Perugia in 1462; others quickly followed. By the sixteenth and seventeenth centuries, Spaniards could seek loans at civic pawnshops (positos) ; residents of the southern Netherlands frequented local monti ; inhabitants of Amsterdam and Stockholm brought pawns to their own municipal lenders; Protestant Frankfurt am Main established a community chest, modeled after the monte. Public pawnshops, however, could not accommodate all potential borrowers, a fact evinced in the sixteenth century by the Medici dukes' concessions to Jews of monopoly pawnbroking privileges in areas with no monti, and in the argument of a Venetian patrician against the expulsion of Jews on the grounds that pawnbroking was essential for the needy.

The wealthy, too, resorted to pawning, whether at pawnshops or other institutions, including international banks. Clients of Siena's monte included patricians, lawyers, and doctors. In Spain, Charles I (ruled 1516–1558; Holy Roman emperor as Charles V 1519–1556) secured loans by pledging income from unfilled benefices. The Venetian Republic pawned jewels from the church of San Marco against a loan from the banker Agostino Chigi (c. 1465–1520). In 1456 the banker Tommaso Spinelli lent Pope Calixtus III (reigned 1455–1458) nineteen thousand florins against a bejeweled tiara crafted by the sculptor Lorenzo Ghiberti (c. 1378–1455). The Medici bank's Basel branch took jewelry as pledges, revealing that the Medici occasionally served as glorified pawnbrokers to the rich and famous. In England, where Jews had been expelled in 1290, an act of Parliament in 1603 attempted to control the alleged criminal tendencies of pawnbroking, to which, nonetheless, the wealthy sometimes resorted for purposes like raising cash for their daughters' dowries.

Whether through pawnbrokers, institutions such as monti di pietà, or, more rarely, large banks, pawning offered the only ready source of loans for the needy during seasonal or unexpected crises, and allowed the powerful to obtain cash for valuables. It thus formed one of the financial strategies of rich and poor alike in early modern Europe.

See also Charity and Poor Relief ; Interest ; Jews, Attitudes toward .

BIBLIOGRAPHY

Menning, Carol Bresnahan. Charity and State in Late Renaissance Italy: The Monte di Pietà of Florence. Ithaca, N.Y., 1993. Examination of the charitable pawnshop of Florence, including its anti-Semitic origins and its use by rich and poor alike.

Pullan, Brian. Rich and Poor in Renaissance Venice: The Social Institutions of a Catholic State, to 1620. Cambridge, Mass., 1971. Sweeping view of the survival strategies of the various classes of Venice, including their use of monti di pietà and other pawnshops.

Roth, Cecil. The Jews in the Renaissance. Reprint. New York, 1965. Overview of Jewish moneylending and the growth of anti-Semitism in Europe.

Tebbutt, Melanie. Making Ends Meet: Pawnbroking and Working-Class Credit. Leicester, U.K., and New York, 1983. Discussion of pawnbroking in modern England, but with informative references to the early modern period as well.

Carol M. Bresnahan