braude-venture and faith in the commercial life of the ottoman balkans

Venture and Faith in the Commercial Life of the Ottoman Balkans, 1500-1650Author(s): Benjamin BraudeReviewed work(s):Source: The International History Review, Vol. 7, No. 4 (Nov., 1985), pp. 519-542Published by: Taylor & Francis, Ltd.Stable URL: http://www.jstor.org/stable/40105533 .Accessed: 04/12/2011 04:35

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Venture and Faith in the Commercial Life

of the Ottoman Balkans, 1500 -1650

BENJAMIN BRAUDE

Your mind is tossing on the ocean ; There where your argosies with portly sail, Do over peer the petty traffickers.

Should I go to church, And not bethink me straight of dangerous rocks, Which touching but my gentle vessel's side, Would scatter all her spices on the stream ; Enrobe the roaring waters with my silks ...

WILLIAM SHAKESPEARE,

The Merchant of Venice, I.i.

All who lived in the sixteenth and seventeenth centuries knew the

dangers of travel and trade. Economists have called such obstacles to trade, transaction costs. Despite its infelicity, the concept does provide a means of analyzing systematically the difficulties merchants had to overcome. These costs forced upon the merchants of the Ottoman Balkans a

strategy, a certain method of commerce, rooted in the social order and

dependent upon primordial ties.1 Their strategy carried with it certain

implications for economic development in the Balkan provinces. To draw out these implications it is necessary first to explain the nature of transaction costs, and then the strategies used to overcome them.

In essence transaction costs are the costs of doing business beyond the cost of the merchandise itself, that is, 'they arise not from the production

1 Abner Cohen, 'Cultural Strategies in the Organization of Trading Diasporas', in The Development of Indigenous Trade and Markets in West Africa, ed. Claude Meillasoux (London, 1971 ), p. 274.

The International History Review, vii, 4, November 1985, pp. 519-690 cn issn 0707-5332 © The International History Review

Benjamin Braude

of goods but from their transfer from one owner to another.'2 For instance, transaction costs include the cost of transporting merchandise to its destination and the price of insurance against the risk of not reaching it. Transaction costs also include the customs fees which toll collectors may exact legally, and the bribes, often much heavier, which officials may extort illegally. Transportation-related costs are obviously connected with any transfer of property. Other costs were significant as well, notably the cost of credit, of contract negotiation and enforcement, of information, and of protection.

In the sixteenth and seventeenth centuries credit arrangements were risky. Investment in trade, particularly in the Mediterranean and the Balkans, was not through joint-stock companies, but through partnerships, bottomry, or commenda wherein the risk of any venture weighed heavily on the few, not lightly on the many.3 Should his fortune be entrusted to one ship, a single mishap could bankrupt a merchant and cripple his creditors. Further, the lack of ready communication meant that credit had to be granted on the basis of tardy and inadequate information, when it could be granted at all.

The cost of contract negotiation included the cost of search, negotiation, and agreement. A distant sale involved an agent, factor, or some such person charged with the responsibility of selling merchandise at the best price and returning the profit in specie or in kind to his employer or partner. A local sale could be handled directly, but both entailed the time-consuming process of identifying a likely customer, fixing a price, and arranging the terms of payment.

The payment of creditors, the resolution of disputes over contracts and partnerships, and the assessment of responsibility for goods lost or dam- aged in transit all involved the process of law. The many frontiers crossed by international trade stymied the enforcement of contracts. Litigation came high when it had to contend with differing jurisdictions and con- 2 Clyde G. Reed, Transaction Costs and Differential Growth in Seventeenth

Century Western Europe', Journal of Economic History, xxxiii (1973), 181 ; and Douglas C. North and Robert Paul Thomas, The Rise of the Western World (Cambridge, 1973), P- 93-

8 Commenda is an 'arrangement in which one party invests capital and another party trades with it on the understanding that they share the profits in an agreed ratio, and that any loss resulting from normal trading activities is borne by the investing party'. Abraham L. Udovitch, Partnership and Profit in Medieval Islam (Princeton, 1970), p. 273. Bottomry is a kind of mortgage 'whereby the owner of a ship or his agent, borrows money to enable him to carry on or complete a voyage and pledges the ship as security for repayment of the money. If the ship is lost, the lender loses his money; but if it arrives safe, he receives the principal together with the interest ... stipulated'. The Compact Edition of the Oxford English Dictionary (New York, 1971), s.v., bottomry.

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tradictory concepts of law. The limited effectiveness of the state in struc- turing and enforcing the law meant that even when the parties to a dispute were residents of the same city or empire there was limited hope of justice.

The gathering of commercial intelligence was also expensive. In those days of inelastic production costs, profits were made not through manu- facturing efficiencies or technological innovations,4 but through the simple expedient of buying low and selling high. This could be done by hoarding and selling in times of famine and shortage, but it was more likely to be accomplished by buying goods where they were cheap and transporting them to where they were dear.5 Such a venture, to be profitable, had to depend on the kind of intelligence that was always alert to shifts of price; and so an intricate network would be constructed, reporting the wrecks of ships, the arrival of wool shipments, the depredations of brigands, the attacks of corsairs, and the failure or plenty of harvests. If the network was large and wealthy, such reports might appear in the Fugger news- letters or the correspondence of some merchant family;6 if the traders were humble, tidbits of such information would be among the attractions

* Revisions in Mercantilism, ed. D.C. Coleman (London, 1969), p. 14. 5 Benjamin Ze'eb (ft. late 15th, early 16th century), She'elot uteshubot (Responsa)

(in Hebrew) (Jerusalem, 1959), question 378; and Isaac ben Samuel Adarbi (c. 1520-84), Dibrey Ribot (Responsa) (in Hebrew) (Szdilkiew, 1833), question 341. Responsa is the technical term for the legal opinions of Rabbinic authorities on questions of Jewish law. Should a question of law not be adjudicated to the satisfaction of all parties to a dispute, either the disputants or the judges themselves, who were usually rabbis, could appeal the question to another rabbi whose stature and knowledge of the law were widely recognized. The value of these sources is not limited to the history of Jewish law or to the internal history of the Jewish community. Indeed, these sources shed considerable light on general social conditions, risks of voyage, organization of trade, the workings of government, and a host of other day-to-day problems. Since the question may often contain verbatim court testimony, the source offers a real slice of life. The responsa literature of the Jews in the Ottoman Empire is particularly rich from this period since, among other reasons, the establishment of Hebrew printing in Venice, Salonika, and Istanbul helped preserve these works. For an introduction to responsa as a historical source, see Solomon Freehof, The Responsa Literature (Philadel- phia, 1959). Examples of other studies drawing upon such sources are Haim Gerber, Economic and Social Life of the Jews in the Ottoman Empire in the 16th and 17th Centuries (in Hebrew) (Jerusalem, 1982); Isaac Samuel Em- manuel, Histoire de Vindustrie des tissus des Israelites de Salonique (Paris, 1935) » and A. Hananel (in vol. ii, Hannanel) and E. ESkenazi, Fontes hebraici ad res oeconomicas socialesque terrarum balcanicarum saeculo XVI pertinentes, i (Sofia, 1958), and Fontes ... saeculi XVII, ii (Sofia, i960). This work is in Bulgarian, despite the Latin title page, with photo-copies of the sources and summaries in Russian and French.

6 Jose Gentil de Silva, Strategie des affaires a Lisbonne entre 1595 et 1607 (Paris, 1956); and The Fugger News-Letters ... 1568-1605, ed. Victor von Klarwill, tr. Pauline de Chary (New York, 1925).

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of the regional trade fairs, where news was exchanged like pieces of cloth or lavish furs. In the mid-sixteenth century, for example, merchants would hear the latest accounts of brigandage throughout Macedonia and Thrace from their colleagues who attended the fair at Moskolor.7

The costs did not end here, for every merchant traveller faced the risk of death and, saving that, of captivity which might be as bad as death for his loved ones. The trader selling his wares and collecting his debts in the villages of Wallachia could end up in Bucharest at the bottom of a well.8 Or he might survive to be taken prisoner in chains.9 If he was lucky, he would escape with his life and freedom only at the cost of his goods.

The picture that emerges from the sources contradicts the conventional picture of a Pax Ottomanica reigning over the sixteenth-century Bal- kans.10 The assumption that brigandage was a phenomenon unique to the eighteenth and nineteenth centuries is an oversimplification. Whatever the level of violence in the so-called declining years of Ottoman rule, a high level of civil disorder probably existed in all periods. The claim that earlier years were peaceful and secure stems from a tendency to idealize the reign of Suleiman the Magnificent and the unwarranted assumption that Ottoman military power, which subjugated foreign adversaries, could control internal violence as well.11

In fact, the level of risk was so high that in one year the Jewish communities of Monastir and Belgrade promulgated a ban against attending the fair at Struga, citing as one of the reasons the danger of bandits on the road.12 In at least two separate cases in the mid-sixteenth century, the most respected legal authority of Ottoman Jewry, Rabbi Samuel de Medina, ruled that travel was so risky that it should be avoided. In one instance, a mother made a death-bed wish that her son bury her remains in Palestine. Normally such a wish would have taken precedence over any other, but Samuel de Medina concluded that the danger of travel by land or sea was enough to overrule her request.13 In another instance, a

7 Samuel de Medina (£.1506-89), She'elot uteshubot (Responsa) (in Hebrew) (Salonika, 1593-8?), section iii, questions 35, 47, 52, 85, 196.

8 Ibid., question 54; same case in Adarbi, Responsa, question 15, and in Joseph Caro (c. 1 488- 1 5 75) Beyt Yosef (Mantua, 1730), folio 54, columns a and b, question 12 in section on laws concerning a witness who spontaneously and without ulterior motive offers testimony.

9 Medina, Responsa, section iii, question 59. 10 Leften Stavrianos, The Balkans since 1433 (New York, 1958), pp. 1 12-15. 11 Fernand Braudel, The Mediterranean and the Mediterranean World in the Age

of Philip II (London, 1972), i. 744; and Michael Cook, Population Pressure in Rural Anatolia, 1 450-1600 (London, 1972), pp. 30-1.

12 Medina, Responsa, section ii, question 155. 13 Ibid., question 203.

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widow sought to leave her late husband's family and return to her own some distance away, taking with her an infant daughter. Her husband's family challenged the plan, citing, among other reasons, the danger of the routes. Both the leading jurist of Egyptian Jewry, David ibn Abi Zimra, and Samuel de Medina agreed that this was just cause to separate the infant from her travelling mother.14

The Ottoman sources reveal that all travellers suffered depredations. The Seat of Felicity repeatedly addressed decrees to the provincial officials of Skopje, Pirlepe, Prizrin, and Monastir to suppress the bandits who flourished in the villages of Macedonia.15 Merchants stopped going to the Dolia Fair because of the threat of robbery.16 Brigands flourished in the regions of Tirnova, Lesnova, and Egri Dere.17 River pirates attacked travellers along the Danube.18 For the merchant, death or captivity was the ultimate transaction cost, and the strategy devised to reduce, if not to overcome it, was the method also used to overcome the others (information, enforcement, negotiation, and credit). It was the ethnic trading network.

Ethnicity is a slippery term. Attempts at definition have been more evasive than substantive. One might call an ethnic group a nation without army, navy, or seat at the U.N. Fredrik Barth has written that ethnic identity is an ascriptive term, which is one way of saying that ethnics are whoever and whatever they and others say they are.19 Clifford Geertz has described ethnic ties as 'a primordial attachment'. By that he means 'one that stems from the "givens",' that is, the assumed givens of social existence: immediate contiguity and kin connection mainly, but

beyond them the giveness that stems from being born into a particular religious community, speaking a particular language, or even a dialect of a

language, and following social practices. One is bound to one's kinsman, one's

neighbor, one's fellow-believer, ipso facto; as a result not merely of personal necessity, common interest or incurred obligation, but at least in great part 14 Ibid., section iii, question 123. 15 Dushanka Shopova, Makedonija vo XVI i XVII Vek, Dokumenti od Carigradskite

Arhivi [Macedonia in the XVIth and XVIIth Centuries, Documents from the Istanbul Archives] (in Macedonian, with transcriptions into Modern Turkish) (Skopje, i955)> PP- *5> 27-8, 32-3, 53, 65-6, 78.

16 Shopova, Makedonija, p. 89; and Isaac S. Emmanuel, Tombstones of Salonica (in Hebrew) (Jerusalem, 1963), i. 204-13.

17 Shopova, Makedonija, pp. 90-1. 18 Mustafa Cezar, Osmanli Tarihinde Levendler [Irregular Military Forces in

Ottoman History] (in Turkish) (Istanbul, 1965), p. 14; and Medina, Responsa, section iii, question 44; same case in Samuel Qal'ay (c. 1500-82), Mishpatey Shmuel (Responsa) (in Hebrew) (Venice, 1599), question 80.

19 Ethnic Groups and Boundaries, ed. Fredrik Barth (Boston, 1969), pp. 9-38.

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by virtue of some unaccountable absolute import attributed to the very tie itself.20

Despite the difficulties of the term, most would agree that four traits determine ethnicity: race (or blood ties), language (or dialect), culture (social practice and values), and religion.21 The precise importance of each trait in ethnic affiliation varies from society to society.

In the world of Islam, religion has been the trait that determines ethnicity. Thus the Ottoman government regarded the Greek of the Morea, the Serbian of Belgrade, and the Bulgarian of Sofia equally as rumi (from Romaioi, literally Romans; in Byzantine usage, Greeks) for all were com- municants of the Greek Orthodox Church. For the most part, non- Muslims accepted the corollary of this criterion; in Jewish and Christian sources a convert to Islam became a Turk.22

Current popular usage notwithstanding, minority status is not a trait of

ethnicity. Members of the majority culture often assume that they alone have no ethnic identity, but one need not be of a minority to be ethnic

(though there must be minorities for there to be ethnicity) . It is the feeling of distinctiveness, of boundary, that gives strength to ethnicity, which

ultimately depends on the awareness of the divide between 'us' and 'them5.

If the more the minorities the stronger their identity, Rumelia (Otto- man Europe) was the heartland of ethnic sentiment, for the Balkans were an ethnic hodgepodge: Muslims, Greek Orthodox, Armenians, and Jews, as well as Protestants, Catholics, and gypsies. Within any group there could be further subdivisions, often linguistic; Muslims could be Turks, Persians, Arabs, or proselytes from Christianity, Judaism, or pa- ganism. The devsirme system, which selected young male Christians for conversion to Islam and advancement to careers in the government, filled the Ottoman bureaucracy with many who were still attached (both prac- tically and sentimentally) to their regions of birth or their former co- religionists.23 20 Clifford Geertz, 'The Integrative Revolution: Primordial Sentiments and Civil

Politics in the New States', in The Interpretation of Cultures (New York, 1973), P. 259.

21 A somewhat different definition appears in Urban Ethnicity, ed. Abner Cohen (London, 1974), pp. ix-xxiv.

22 This terminology appears consistently in the responsa literature, and in Christian documents from the Ragusan archives, Bogumil Hrabak, 'Domaci trgovci u Novom Pazari u xvi veku', [Domestic Traders in Novi Pazar in the XVIth century] (in Serbian) Istoriski Glasnik, nos. 3-4 (1951), pp. 99-104.

23 Metin Ibrahim Kunt, 'Ethnic-Regional (Cins) Solidarity in the Seventeenth- Century Ottoman Establishment', International Journal of Middle Eastern Studies, v (i974)» 233-9.

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In the early sixteenth century, the Balkans were 81% Christian, 18% Muslim, and 1 % Jewish. The countryside was Christian. Most Muslims lived in cities, though they formed rural concentrations in Thrace and Bosnia, and on the shores of the Black Sea.24 Jews were overwhelmingly urban -they formed the largest single element in the Balkan entrepot, Salonika, and they were scattered in much smaller settlements throughout the towns of the peninsula.

Ethnic diversity raised ethnic consciousness, which led to the creation of informal associations above and beyond an ethnic group's elementary needs. In a sixteenth-century Balkan town, such needs would include a site for worship and learning (a mosque, church, or synagogue) and an individual to give religious instruction and leadership (an imam, priest, or rabbi). And, as the Ottoman government dealt with individuals pri- marily as members of an ethnic community, each community also needed a local leader, lay or religious, to treat with authority, for example, to bribe the tax-collector. Beyond these elementary needs, however, there arose informal associations which among the peoples of the Balkans naturally took an ethnic form. The most characteristic of these was the ethnic trading network, which may best be defined as a far-flung diaspora composed of communities which shared distinctive values of culture, ties of blood, language, and religion, and were in addition linked by commerce. The function of this network was mutual advancement and protection, which it provided in a variety of ways.

The redemption of captives being held for ransom proceeded on ethnic and religious lines. Members of the Greek clergy travelled so widely in search of funds to redeem their brethren taken in Turkish raids on Morea and Crete that they reached El Greco's Greek community in Toledo.25 The Jews of Mantua sent money to redeem captives in Hungary and later responded to an appeal from Zante.26 In Jewish law the ransoming of prisoners, pidyon shvuyim, was foremost among the duties carried out by the congregations of Israel.27 Emissaries were sent far and wide to

24 N. Todorov, 'Za demografskoto sustoinaie na balkanskaia poluostrov prez xv-xvi v.J [The Demographic Situation in the Balkan Peninsula during the XVth and XVI th Centuries] (in Bulgarian with French summary) Godishnik na Sofiiskiia Universitet, Filosofsko-Istoricheski Fakultet, liii (1959), 215, 230-2; and Omer Liitfi Barkan, 'Research on the Ottoman Fiscal Survey', in Studies in the Economic History of the Middle East, ed. Michael Cook (London, 1970), p. 170.

25 Gregorio Maranon, El Greco y Toledo, 2nd ed. (Madrid, 1958), p. 162. 26 Shlomo Simonsohn, History of the Jews in the Duchy of Mantua (Jerusalem,

1977), PP- 461-2. 27 Eliezer Bashan, Captivity and Ransom in Mediterranean Jewish Society (1391-

1830) (in Hebrew) (Ramat-Gan, 1980), pp. 19-27.

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raise special funds for the purpose. Jewish communities located in major market centres such as Constantinople or Lvov were entrusted with the

responsibility of locating, redeeming, and returning home captives who came their way, and so efficient was their network that in at least one instance a captive feigned Jewishness in order to hasten her freedom.28

The whole process of taking and freeing captives itself became a business - in fact a branch of the slave trade. In the sixteenth and seventeenth centuries along the Hungarian marchlands of Christendom and Islam, the likelihood of capture in border raids was such an accepted risk that in the words of one scholar there were individuals who became 'professional prisoners'.29 Certain Muslims, for example, would regularly allow themselves to be captured in order to help redeem their fellow Muslim prisoners. Once captured, the professional prisoner would offer his ser- vices as a ransom collector, and together captive and captor would set the amount of ransom to be demanded for each prisoner. The professional prisoner would then be returned to the territory of Islam in order to

gather the agreed sums. To support himself he would add a commission to the ransom demand and collect the total from the friends and relatives. A comparable system evolved in the Mediterranean, where Christian and Muslim corsairs maintained a lively trade in prisoners. Christian orders, such as the Redemptionist Fathers, devoted their time to ransoming Catholic captives. They were not as effective, however, as their Jewish counterparts who, for a considerable fee, would ransom non-Jews as well.30

The role of the state in this process was exceptional. It was only when the captives had official status or considerable influence that Christian or Muslim governments would bestir themselves to free or exchange prisoners. In 1575, when two Ottoman sancakbeys (district governors) were among the Muslim prisoners held in Rome, their exalted status prompted the Grand Vizier, Mehmed Sokullu, to exchange them for various infidels imprisoned in the fortresses of the Dardanelles.31

The social basis for redeeming captives was a system of ethnic ties which bound distant communities into a mutual-help network. For a fee a prisoner could be redeemed through a network other than his own, and in unusual cases a government might intervene, but normally he had to 28 Mordecai Halevi, (/?. seventeenth-century Egypt) Darkey Noam (Responsa) (in

Hebrew) (Venice. 1697). section iii, questions 14, 15. 29 Peter F. Sugar, 'The Ottoman "Professional Prisoner" on the Western Borders of

the Empire in the Sixteenth Century', Etudes balkaniques, vii (1971), 82-90. 30 Peter Earle, Corsairs of Malta and Barbary (London, 1970), pp. 86-9. 31 Nicolaas H. Biegman, The Turco-Ragusan Relationship, according to the Firmans

of Madrid III (1575-1595) Extant in the State Archives of Dubrovnik (The Hague, 1967), pp. 145-6.

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depend upon his own ethnic brethren. Although in many respects less elaborated, this same network was the basis for reducing other transaction costs as well.

Loss of property, through extortionate demands by tax-collectors or

rapacious attacks of brigands, was more difficult to control. For a merchant robbed on a journey the ethnic trading system provided a local

community ready to defend his interests and plead his grievances. A

petition to the local constabulary and a search of the market for signs of the stolen merchandise might not return the goods, but at least the merchant could rely on the psychological reassurance that something was

being done in his cause. Of course there was no way to bring any one back from the dead, but

the system of blood money had at least the effect of diminishing the returns of murder and robbery; if caught, the criminal faced both the wrath of local Ottoman authorities and demands for compensation to the family of the victim, a risk of double jeopardy.32 In the summer of

1558, the body of an itinerant peddler, Mordecai de Boton, was found on the banks of the Vardar near the village of Batinsa, on the route to Monastir. The local cavalry had seized the murderers and kept them in

custody until the victim's relatives arrived. The soldiers bastinadoed the rest of the village as well, one of whom later said to a Jewish acquain- tance, 'May God smite those who killed Mordecai, for from the day they killed him we have found no rest for the soles of our feet. Perhaps you know if Daniel, his brother, will still demand his blood money.'33 Thus the practice of blood-money constantly reinforced the solidarity of the victim with his community.

All too often, though, the criminal escaped punishment and then there was only recourse to prayer. Pleas for revenge may appear as pious formulas in the testimony to murder and pillage, but their formulaic

wording did not diminish their significance, or their impact upon those

invoking and hearing them.34 These prayers were yet another means of

reinforcing the sense of group solidarity which was so important in main-

taining the morale of a merchant community. One appealed to God to ward off imminent dangers as well as to seek

solace for harm already suffered. The accounts of prisoners in captivity

32 Medina, Responsa, section iii, question 44. 33 Ibid., question 57. For the location see also Hananel and ESkenazi, Fontes, 1, 84.

For further details on the bastinado see Uriel Heyd, Studies in Old Ottoman Criminal Law, ed. V.L. Menage (Oxford, 1973), pp. 271-5.

34 Medina, Responsa, section iii, question 44 ; same case in Qal'ay, Responsa, question 80; and Adarbi, Responsa, question 307.

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or sailors and passengers at sea are filled with supplications to the Al- mighty. These prayers were not a source of unity among the afflicted, however, for the act of prayer with its varied appeals to saints, janun, theotokos, and Trinity, Allah, and the Holy One blessed be He, divided the supplicants by rite and ritual, dialect and language.35 In distress each sought communion with God, but it was with his own God. Even external threats failed to overcome the divisions between groups; rather, such threats strengthened the barriers.

Each group used its own language not only for prayer but also for the transmission of commercial intelligence. A trading diaspora, urban, settled amidst an alien population, and spread thinly over a large area, was an ideal vehicle for gathering news, which was transmitted by whatever means came to hand. Thus two Jewish merchants exchanged the latest reports of cloth and silk on the back of an Ottoman letter addressed to the English.36 As both were Ladino-speakers with connections to the English, they were confident that their correspondence would remain inviolate and confidential. If there was no 'diplomatic pouch' there were the pig- eons that carried reports from Iskenderun to Aleppo.37 As there was no regulated postal system, a merchant could add his letters - with a bit of baksheesh -to the frequent express messages dispatched by the Seat of Felicity to its servants throughout the Empire. Thus seventeenth-century merchants were able to communicate with their agents in such outposts as Izmir, Ankara, or Belgrade.38

Each trading network provided not only its own distinct system of market intelligence, but also of law. The jurisdiction of a religion-based court was one way to ensure proper commercial behaviour. Because its jurisdiction was international, it could carry its authority beyond the limits of a civil court. In the Ottoman Empire, the Muslim 'civil' courts were, in fact, as parochially religious as those of the Jews, the Greek Orthodox, or the Armenians. As participation in a trading network crossing ethnic lines would subject a non-Muslim (dhimmi) to the jurisdiction of a Muslim court, whose brand of justice might not work to his 35 La Mottraye, Voyages (London, 1723), i. 75; and also The Travels of Macarius,

Patriarch of Antioch ... by Paul of Aleppo, tr. Francis C. Belfour (London, 1836), i. 12-13.

86 P[ublic] R[ecord] O[ffice,] S[tate] P[apers, Foreign,] 102/61. For a different interpretation see by Bernard Lewis, 'A Letter from Little Menahem', Studies in Judaism and Islam presented to Shelomo Dov Goitein, ed. Shelomo Morag, Issachar Ben-Ami, and Norman A. Stillman (Jerusalem, 1981), pp. 18 1-4; and The Jews of Islam (Princeton, 1984), p. 143.

37 Stanley Mayes, An Organ for the Sultan (London, 1956), p. 130. 88 La Mottraye, Voyages, i. 194.

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favour, the legal system reinforced the tendency to remain within a network.

Thus cross-trading, for the dhimmi, bore an additional transaction cost - the threat of litigation before an alien court. The quality of justice in the Muslim court was probably not worse and perhaps better than comparable institutions in Christendom39 - but for the Christian or Jew who came before it there were obvious disadvantages. These stemmed in part from the disabilities placed upon the non-believer, the most notable of which was the limited value of his testimony. A dhimmi could not testify against a Muslim, be the case a simple matter of debt or a serious matter of murder, though he could testify against another dhimmi, even if they were of different religions.40 Another disability was the Muslim courts' refusal to recognize decisions brought down by dhimmi judges.41

Ottoman rulers, in accordance with the principles of ancient statecraft and the teachings of Islam, allowed considerable autonomy to the Chris- tian and Jewish communities in their midst, including the right to main- tain separate systems of law.42 Armenians, Jews, and Orthodox had their respective courts, and in addition legal autonomy was given to foreign traders who flourished in the Empire.43 Besides systems which were more or less codified, there were quasi-legal arrangements of customary law, for example, tribal law, particularly strong in such inaccessible areas as the highlands of Albania.44

These varied systems led to conflicts of law. The most common and troubling occurred when a case settled in one system reappeared in another, necessitating costly appearances before both courts. Such problems accompanied the dissolution of partnerships. As partnerships, particularly long-term ones, were normally within the ethnic network, issues arising among the partners could be settled in their own communal court. When they wished to end their alliance, they would repair to the 89 Heyd, Studies, pp. 208-34. 40 Mario Grignaschi, 'La valeur du temoinage des sujets non-musulmans (dhimmi)

dans Tempire ottoman', Recueils de la society Jean Bodin pour Vhistoire com- parative des institutions: vol. XVIII. La Preuve: part three. Civilisations archaiques, asiatiquesy et islamiques (Brussels, 1963), pp. 211-323.

41 J. Visvisis, 'L'administration communales des Grecs pendant la domination turque', Le cinq-centieme anniversaire de la prise de Constantinople. Fasicule hors seVie de UHellenisme Contemporaine (Athens, 1953), pp. 217-38.

42 See Christians and Jews in the Ottoman Empire, the Functioning of Plural Society, vol. I, The Central Lands, ed. Benjamin Braude and Bernard Lewis (New York, 1982), 12-13.

43 Niels Steensgaard, 'Consuls and Nations in the Levant from 1570-16501, Scan- dinavian Economic History Review, xv (1967), 13-55.

44 Margaret Hasluck, The Unwritten Law in Albania, ed. J.H. Hutton (Cambridge, 1954)-

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communal authority and arrange a dissolution. The settlement specified that in return for an agreed sum, Partner A would accept responsibility for any unpaid debts of the business and would absolve Partner B from

any future litigation with any third party over activities prior to dissolution. Such an agreement would be legally recognized within the commu-

nity. As long as the community was Muslim, the dissolution would probably be binding for other groups as well, but if it was made before a Christian or Jewish court, its purview was restricted. Because the non- Muslim court's decision was not recognized outside the community, Part- ner B, the dissolution agreement notwithstanding, could be brought into a Muslim court to pay debts contracted by a now defunct business. In order to recover this money from his former partner, he had to return to the communal court for satisfaction.45 Within the Ottoman Empire, the

principle of res judicata did not apply to the decisions of the dhimmi courts.46

One solution to the second disability - the non-recognition by Muslim courts of the decisions of Christian and Jewish courts - was to transact one's business in a Muslim court. But then the dhimmi merchant ran afoul of the first disability - the limited value of his testimony. Caught in this dilemma he evolved a compromise; he would register his business transactions with the Muslim court without actually conducting them before that court. By inscribing each debt, contract, partnership agreement, or dissolution in the Muslim judicial registers, he would have a legally rec-

ognized document in the event of civil or criminal action before that court. For the dhimmi merchants, Muslim courts functioned more as

notary publics than judicial arbiters. The dhimmi merchant used a Mus- lim court as notary, with the hope that if he should be brought before it, at least a judicial document might defend him where his spoken word could not.47

These were the disadvantages of venturing outside, but there were also

45 Samuel Hayyon (fl. ?-i6o8), Bney Shmuel (Responsa) (in Hebrew) (Salonika, !6i3), question 30; and QaPay, Responsa, question 47.

46 Visvisis, ̂ 'administration communale', pp. 233-4. 47 This is my interpretation of the frequency of dhimmi appearances in Muslim

courts. See also Ronald Jennings, 'Loans and Credit in Early 17th Century Otto- man Judicial Records', Journal of the Economic and Social History of the Orient, xvi (1973), 168-216; Haim Gerber, Economic and Social Life; Haim Gerber and Jacob Barnai, The Jews in Izmir, in the igth Century Ottoman Documents from the Shar'i Court (in Turkish, with Hebrew translation, introduction and English summary) (Jerusalem, 1984) ; Amnon Cohen, Ottoman Documents on the Jewish Community of Jerusalem in the Sixteenth Century (in Turkish, with Hebrew translation, introduction and English summary) (Jerusalem, 1976); and Amnon Cohen, Jewish Life under Islam, Jerusalem in the Sixteenth Century (Cambridge, Mass., 1984).

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advantages in remaining within both the trading network and its legal system. Recourse to Christian and Jewish courts was advantageous in international trade with Europe because there one could find jurisdictions that would recognize their validity. The Jewish communities of Italy, for example, would turn for legal counsel to the great Rabbinic scholars of their generation who flourished in Salonika.48 Many rabbis acted as legal consultants in both Christendom and the Ottoman Empire.49 The legal principles that guided the practice of Armenian merchants in As- trakhan and Aleppo also guided their brethren in Lvov.50 Muslim courts had comparable advantages. Where Muslims dominated international trade, with areas to the south and east of the Ottoman Empire, there flourished a legal system in which the decisions of a Muslim judge in Belgrade would, in principle, be valid for the courts of Jidda, Mombasa, or Delhi. The scholar of the sixteenth century, al-Muttaqi al-Hindi, could begin his career in Mogul India, but end it in Ottoman Arabia, moving within a cosmopolitan society which everywhere recognized his mastery of the traditions of Muslim law.51

There was yet another system which crossed frontiers and bridged ethnic and religious gaps, the established practise of merchant's law- which is recognized in both Muslim and non-Muslim legal documents. To be sure, this functioned well for most daily transactions, but for issues of litigious complexity lex mercatorum, minhag soharim, or urf al-tujiar often proved inadequate.52

Thus, the advantages and disadvantages of one or the other legal system within the Ottoman Empire varied with each context and individual; although there were exceptions, by and large the greatest advantage lay in one's own communal law court, a circumstance that once again reinforced the ethnic trading network.

In Ottoman society in the sixteenth and seventeenth centuries, life was lived within one's own community. The existence of dietary laws for Jews and Muslims restricted their social contact with each other or with 48 Rabbi Samuel de Medina received many such inquiries. 49 Rabbi Benjamin Ze'eb cited above, for example. 50 L. von Khachikian, 'Le registre d'un marchand armenien en Perse, en Inde, et au

Tibet (1682-1693)', Annales, xxii (1967), 231-78; and Marian Oles, The Armenian Law in the Polish Kingdom (1356-15 19) (Rome, 1966), pp. 23-5.

51 See The Encyclopedia of Islam, 1st ed. (Leiden, 1936) s.v. al-Muttaki al-Hindi; and Hamilton Gibb and Harold Bowen, Islamic Society and the West (London, 1962), i. 114-38.

52 Lecture by A.L. Udovitch, *Local Knowledge and Local Rationality: an Inter- pretation of Medieval Islamic Commercial Law', Center for Middle Eastern Studies, Harvard University, 27 Feb. 1985.

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Christians.53 Time spent in public worship, in communal celebration, at the coffee-house, or by the fountain in a mosque-courtyard, could help make a contact or confirm a deal. Such gatherings were venues for the informal negotiations that preceded and accompanied most business transactions. Customers were more quickly found in one's own group. Of course the organization of bazaars by streets and markets devoted to specific commodities (for example, the bedestan to trade in cotton and other cloths, the suq al-attarin to deal in spices) did provide one venue outside the ethnic framework.

The last transaction cost - credit - remains. As money, credit was both a cost of doing business and a commodity whose buying and selling was a business in itself. As a commodity, like wheat or wool, its cost was subject to the vagaries of supply and demand. Unlike other transaction costs, the cost of credit was not easily reduced by the ethnic trading system. In fact, there were risks in granting interest-bearing loans not present in loans granted under the same terms outside. Thus, credit within the trading network could be more expensive than credit outside it.

Influencing the entire matter were the religious injunctions against usury, which, erratically enforced as they were within Judaism, Christian- ity, and Islam, could be used to avoid unwelcome interest charges. In Christendom, canon law gave religious backing to the ill treatment of the most conspicuous moneylenders, the Jews: their expulsion or perse- cution could dissolve all debts. However, in the Ottoman Empire such sweeping edicts were unknown; although decrees against usury were issued, they tended to limit interest charges, rather than ban them, the rationale being more a concern for the welfare of the debtor than a desire to enforce religious law.54 The Ottoman state was reluctant to persecute Jews as moneylenders because officials at all levels of the government lent money at interest; in fact Muslim officials were the biggest moneylenders of all. In this respect the Ottoman Empire was more ad- vanced than the commercially innovative city-states of Italy which on occasion needed aliens - Jews - to supply institutions of credit. In Edirne, for example, the wealthiest Muslims were those engaged in moneylend- ing.55 European traders and diplomats could be in debt to members of the Sultan's entourage,56 and Muslim court records from Ankara, Bursa, 53 Qal'ay, Responsa, question 68; and Alexander Pallas, In the Days of the

Janissaries (London, 1951), pp. 57-8. 54 Shopova, Makedoniia, p. 87. 55 Halil Inalcik, 'Capital Formation in the Ottoman Empire', Journal of Economic

History, xxix (1969), 125-6. 56 Bibliotheque nationale, salle de manuscrits, fonds francos 16 163 and 16 150, which

deal with the debts incurred by the French ambassador to Istanbul, de Cesy, in the early seventeenth century.

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Kayseri, and Sofia, as well as the inventories of estates (inquisitions post mortem) in Edirne, all testify to the frequency of interest-bearing loans by Muslims, even religious functionaries, to other Muslims, Christians, and Jews.57

Religious injunctions against usury do seem to have inhibited Jews. Although rabbis could not prevent the charging of interest on loans to other Jews (there were no objections to interest on loans to Gentiles) they could make these charges more difficult to collect. Devices were invented to circumvent these religious prohibitions, and some rabbis were willing to tolerate the letters of exchange and fictitious partnerships that concealed interest charges; but Rabbi Samuel de Medina brooked no such compromise.58 Nonetheless there is a plaintive quality to his utter- ings, for arrayed against him in his quixotic fight were other authorities of almost equal stature. Though he failed to stamp out usury, his opposition did have economic effect; as the leading legal authority in the largest centre of Jewish and Balkan commerce, Salonika, his readiness to nullify a charge of interest in a letter of exchange meant that no trader could rest secure. The exigencies of commerce and the existence of countervailing authorities meant that loans at interest were available, but Samuel de Medina's opposition to them may have contributed to a re- markable phenomenon - apparently the interest rates Jews charged other Jews were as high and sometimes even higher than the rates that Mus- lims charged them.

The rate Jews charged other Jews varied from 10 to 20 per cent per annum.59 Rates of 25, 30, and even 60 per cent were possible.60 Although 57 The sources here are numerous: Halit Ongan, Ankara'nin 1 Numarali Seriye

Sicili [Ankara Court Record Number One] (Ankara, 1958); Halit Ongan, Ankara'nin Iki Numarali Seriye Sicili [Ankara Court Record Number Two] (Ankara, 1974) ; Halil Inalcik, '15 Asir Tiirkiye Iktisadi ve Ictimai Tarihi Kaynaklari' [Sources on Fifteenth Century Turkish Economic and Social History] Istanbul Universitesi Iktisat Fakuletsi Mecmuasi, xv (1953-4), 51-75 ; English summary in Revue de la Faculte des Sciences economiques de VUniversite a" Istanbul, xv-xvi (1953-4), 44-8; Halil Inalcik, 'Bursa XV. Asir Sanayi ve Ticaret Tarihine dair Vesikalari' [Bursa, Documents concerning its Fifteenth Century Industrial and Commercial History] Belleten, xxiv ( i960), 45-102; Omer Liitfi Barkan, 'Edirne Askeri Kassamina ait Tereke Defterlei, 1545- 1659' [Inquisitions Post- Mortem of Edirne Probate Officer] Belgeler, iii (1966), 1-477.

58 Ze'eb, Responsa, question 320; and Medina, Responsa, section ii, question 220; see also Haim Gerber, 'Jews and Money-Lending in the Ottoman Empire', Jewish Quarterly Review, lxxii (1981), 100-18.

59 Joseph ben Lev (c. 1500-88), She' elot uteshubot (Responsa) (Amsterdam, 1726), section i, question 40, and section ii, question 73; Adarbi, Responsa, question 380; Meir di Boton (c. 15 75- 1649), She3 elot uteshubot (Responsa) (Izmir, 1660), question 16; Elijah ben Benjamin Halevy (c. 1480- 1540), Zeqan Aharon (Responsa) (Istanbul, 1734), section ii, question 75; Abraham di Boton (£.1545-89), Lehem Rab (Responsa) (Jerusalem, 1968), question 14.

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Muslims commonly lent money to Jews, only rarely are the terms of the loans preserved in the Hebrew sources. In the one instance discovered, a rate of 10 per cent appears.61 More information on rates appears in the Turkish sources, summarized in the following table:

Table I

Loans in Sixteenth-Century Edirne

Average Average Ethnic Identity Number of Principal Rate of of Debtor Loans (in akce) Return

Gypsies 19 360 20% Muslims (Male) 16 943 11% Muslims (Female) 3 212 25% Jews 3 307 11% Greeks 1 2,000 35%

All Loans 42 607 16%

Based on the records of the estate of Imam Abdi Halife, died in Edirne c. April 1568.62

Jews were not the only ethnic group that failed to reduce the cost of credit through its own network. Christians, too, had to seek credit from other groups. While Muslims and Jews appear in the sources as both lenders and borrowers, Christians appear only as borrowers. During the sixteenth and seventeenth centuries, Christian moneylenders were rare. A variety of sources: Venetian notarial records,63 Jewish legal responsa,04 European travellers accounts,65 the correspondence of a Greek monk from Mount Athos,66 and Ottoman estate registers, all point to a continuing pattern of Christian indebtedness to both Jews and Muslims. In 1535,

60 Adarbi, Responsa, question 331; Solomon ben Abraham Hacohen (c. 1530- 1600), She'elot uteshubot (Jerusalem, 1961), question 64.

61 Medina, Responsa, section iv. 1 70. 62 Barkan, Tereke', p. 140. The term, 'rate of return', is more accurate than interest

rate since none of these loans specify the time period. 63 Documente privitoare la familia Cantacuzino, ed. N. Iorga (Bucharest, 1902),

pp. 4-6. 64 Jacob Tarn ibn Yahya (c. 1475-1542), O hale Tarn (Responsa) (Venice, 1622),

question 150. 65 La Mottraye, Voyages, i. 257. 66 F. Meyer, Die Haupturkunden fiir die Geschichte der Athoskloster (Leipzig,

1894), pp. 72, 221.

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for example, the Christian communities of Nicopolis, Salonika, and Istan- bul sought relief from their debts to Jews in a petition to Suleiman, but the moneylenders bribed Ottoman officials to suppress the protests.67

Thus the ethnic trading system failed to reduce the cost of credit. Two reasons explain this failure : first, credit was regulated by the market to a greater degree than any other transaction cost; and second, religious prohibitions could complicate credit transactions. The system did succeed in reducing other transaction costs - protection, information, enforcement, and negotiation - but though reasonably effective for the society in which it flourished, it had inherent weaknesses. The problem of credit and finance was one but there were others, and the formal-rational system of trade developing in the West proved to be more efficient. Two characteristics of the Balkan system, the ethnic division of trade by commodity, and by territory, illuminate the differences between the new enterprise and the old.

An examination of Ottoman customs records from mid-sixteenth-century Buda in the Ottoman province of Hungary shows that there was an ethnic division of trade by commodity.68 Of the merchant entries, 68% were Muslim, 26% were Christian, and 6% were Jews. In an economy free of ethnic trading networks Muslims could be expected to control as much of the commerce in foodstuffs, for example, as they controlled in commerce as a whole; one would expect to find that 68% of those trading in foodstuffs were Muslim, 26% Christians, and 6% Jews. However, in an economy dominated by ethnic trading networks, one should expect marked specialization - which is what the data reveal. Of those trading in foodstuffs, 97% were Muslim, 1% Christian, and 2% Jews. Of those trading in wine, 92% were Christian and 8% Jews. Of those trading in miscellaneous articles, 98% were Muslims and 2% Christians. While in other categories the distribution was closer to the overall figure (68% M, 26% C, 6%J),a detailed examination of these categories reveals marked specialization there as well. Thus, of those trading in cloth and apparel, 70% were Muslims, 23% Christians, and 7% Jews, but the trade in

imported woollen cloth was overwhelmingly in Christian hands (91%) and Muslims controlled domestic home-made woollen cloth (100%). Of those trading in the general category, animal hair and skins, 54% were Muslims, 44% Christians, and 2% Jews, but within this category the trade in lambskins, sheepskins, and cow hides was Christian (82%) 67 Tarn ibn Yahya, Responsa, question 1 94. 68 Dated 19 Nov. 1550-6 May 1551, Rechnungsbiicher tiirktscher Finanzstellen in

Buda (Ofen) 1550-1580, Turkischer Text, ed. Lajos Fekete and Gyula Kaldy- Nagy (Budapest, 1962), pp. 17-52.

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while Muslims traded in sheep leather, cordovans, leather soles, and wool (95%)- A pattern of commodity specialization - the ethnic division of trade by commodity -is not confined to this particular register. Buda registers dating to 1580 reveal a similar pattern, as do the registers of Vac, a town in northern Ottoman Hungary.69

In the southern Balkans the division of trade continued, but the dividers changed. Replacing Christians, Jews tended to dominate the trade in imported woollen cloth and domestic factory-made cloth, as opposed to the coarser aba (homespun). Muslims maintained their dominance in foodstuffs.

The ethnic division of trade by commodity had an impact on the commercial economy. If trade in an item such as wool were in the hands of relatively few people, particularly people from the same ethnic group, it was almost inevitable that an oligopoly in wool would form. While the ethnic network might be able to reduce the cost of wool through internal efficiencies (the reduction of transaction costs), it could also raise the price at the point of sale. In order to combat the artificially high price of wool, wholesale purchasers, particularly from other trading networks, would form countervailing cartels.

The evidence suggests that such a process of cartel and counter-cartel formation occurred in the Ottoman Empire. Jewish cloth-makers were the domestic buyers of Balkan wool. Utilizing their near-monopoly position, they attempted to restrain its rising price through cartels of purchasers in Salonika, Trikkala, Larisa, Sofia, and Ipsala. A similar process took place with another commodity. The Jewish merchants of Monastir sought to keep the processing and finishing of raw skins for their own profit by prohibiting their shipment to other cities, notably Salonika. Control of skin finishing remained in their hands as long as the Jews maintained their oligopoly of the skin trade, but eventually Muslim merchants started to purchase the skins before they entered the Jewish network.70 The Muslims replaced one cartel with their own and forced the traders of Monastir to abandon their scheme.

Because cartels were easy to form, prices were kept artificially high. Built into the ethnic trading system was an inflationary tendency which 69 Ibid., pp. 53-378; E. Vass, Turkischer Beitrage zur Handelsgeschichte der Stadt

Vac (Waitzen) aus dem 16. Jahrhundert', Ada Orientalia Academia Scientiarum Hungaricae,xxiv (1971), 1-39.

70 Medina, Responsa, section ii, questions 1 17-18; Joseph ben Lev, Responsa, section i, question 47 ; same case in QaPay, Responsa, question 1 o 1 ; Hayyim Shabbetay (c. 1 566- 1 647), Torat Hayyim (Responsa) (Salonika, 1651), section i, question 43; Samuel ben Isaac Gaon (c. 16 10-67), Mishpatim Yesharim (Responsa) (Salonika, 1733), question 57. On Monastir skin-trade, Medina, Responsa, section ii, question 122 and section iv, question 363.

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exacerbated the effects of the so-called price revolution of the sixteenth century upon the Ottoman economy.71 To make matters worse, the highly restrictive guilds which monopolized the system of production also contributed to the inflationary pressures.72 The guild system of production and the ethnic system of trade together put the Ottoman Empire at a competitive disadvantage during the centuries of European expansion.

A corollary of the ethnic division of trade by commodity is the ethnic division of trade by territory. Specialization in a particular commodity tends to occur in the territory of its origin. Of course common goods may originate anywhere, but there are enough articles of restricted origin to establish a pattern of territorial specialization.

Contributing to territorial specialization abroad is the seemingly un- related issue of tolerance and religious freedom. A trading diaspora may not reside wherever it pleases. In the early modern period, free move- ment from one land to another was a privilege rarely granted. When a government chose to bestow it, the most likely beneficiaries were the religious brethren of the governors; the least likely were the brethren of the governor's enemies. For this reason, Muslims rarely ventured into Christendom. On the other hand, Christians benefited from a more tolerant attitude in Islam, so that the passage of European merchants into the Ottoman Empire was relatively common. Jews were often inter- mediaries between the two worlds, but their legal settlement in sixteenth- and seventeenth-century Christendom was restricted.

These simple observations help to explain the international geography of ethnic trading networks. The basic division was that Christians, and to a less extent Jews, traded with Europe across the western borders of the Ottoman Empire, while Muslims traded with Africa and Asia, across the Empire's eastern borders.73 The major exception to this east-west

split were the Armenians. Their centre of population was in eastern Ana- tolia, but through forced migration they had settlements in the Balkans as well, and centuries of political subjugation had spread their merchant colonies throughout the Mediterranean and Asia. In the seventeenth century, Shah Abbas of Persia sought to gain a handsome share of international trade through his establishment of an Armenian colony in New Julfa, twin city to the royal capital of Isfahan. To this end he channelled

71 Omer Liitfi Barkan, 'The Price Revolution of the Sixteenth Century: A Turning Point in the Economic History of the Near East', International Journal of Middle Eastern Studies, vi (1975), 3"28-

72 Halil Inalcik, The Ottoman Empire, The Classical Age, 1300-1600, tr. Norman Itzkowitz and Colin Imber (London, 1973), pp. 153-9.

73 Khachikian, 'Le registre' and Philip D. Curtin, Cross-Cultural Trade in World History (Cambridge, 1984), pp. 179-206.

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Persian exports into Armenian hands.74 Further to the east Armenian merchants travelled the luxury trade routes into central and south-east Asia.75 Because Armenian merchants flourished in Livorno and Venice as well, they were one of the few groups who could compete with the geographically far-flung enterprises of England's Levant and East India Companies. The threat of competition was severe enough for the governors of the Levant Company to prohibit their ships from carrying Ar- menian goods and to discourage trade with them.76 They did not take as drastic steps against the Jews.

The Jews also lived to the east and west of the Ottoman Empire. How- ever, their population centre was in eastern Europe, to the north in Poland-Lithuania, and to the south in the Balkans. The Jews to the east, in Persia and India, were small and insignificant communities.77 Within the Empire their economic strength was concentrated in Mace- donia, for they were the largest single element in Salonika. They were active in the trade between Italy and the Ottoman Empire, both as brokers for Venetian merchants in Istanbul and as merchants in their own right,78 but they did not control it, being but one important group. They do seem to have monopolized two aspects of export trade, however, the commerce between Venice and Valona, and the purchase of English Levant Company goods in Istanbul.79 Despite the existence of large Jew- ish communities in the northern and southern reaches of eastern Europe, there was relatively little north-south commerce between them, perhaps because of the division between Ashkenazi and Sephardi Jews. Of course there were Ottoman Jews who traded in Poland - one was jailed as a spy and another who traded for Joseph Nasi was similarly treated80 - but 74 Vartan Gregorian, 'Minorities of Isfahan, The Armenian Community of Isfahan:

1587-1722', Iranian Studies, vii (1974), 652-80; and R.W. Ferrier, The Armenians and the East India Company in Persia in the Seventeenth and Early Eighteenth Centuries', Economic History Review, xxvi (1973), 38-52.

75 B. Colless, The Traders of the Pearl: The Mercantile and Missionary Activities of Persian and Armenian Christians in South-East Asia', Abr-Nahrain, ix (1969-70), 17-38; x (1970-1), 102-21; xi (i97O? i-2i;xiii (1972-3), H5"35; xiv (1973-4), 1-16; xv (1974-5), 6-17.

76 Poullet, Nouvelles Relations du Levant (Paris, 1668), i. 431. 77 Vera B. Moreen, The Status of Religious Minorities in Safavid Iran 161 7-61',

Journal of Near Eastern Studies, xl ( 1 98 1 ) , 11 9-34. 78 Frederico Seneca, // Doge Leonardo Dona (Padua, 1969), p. 302; and Bernard

Blumenkranz, *Les Juifs dans le commerce maritime de Venise ( 1592- 1609)', Revue des Studes juives, cxix (1969), 143-51.

79 See Braude, 'The Jewish Role in Ottoman Commerce: Some Cautious and Case Studies', in The Mediterranean and the Jews ..., ed. Ariel Toaff (Ramat-Gan, forthcoming).

80 Zygmunt Abrahamowicz, Katalog Dokumentow Tureckich ... 1455-1672 (War- saw, 1959), p. 30; Safvet, 'Yusuf Nasi', Tarih-i Osmani Encumeni Mecmuasi, "i (1909), 988-93-

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their presence there was unusual and their reception did not encourage other Jewish merchants to venture northwards.

The likely instigators of the hostile reception given Ottoman Jews in Poland were the Greeks, who dominated trade between the Empire and Slavic Orthodoxy. At a time when Greeks were under the rule of Islam in their own homeland, their religious and commercial hegemony thrived abroad, spreading north and east to Poland and Muscovy. They staffed the Orthodox churches of Europe - leading clerics moved from Venice to the Balkans to Poland and on to Constantinople as they worked their way up the ecclesiastical hierarchy81 - and they dominated the fiscal bureaucracy of the Duchy of Muscovy as part of the mercantile network which through Poland and Lithuania stretched to the Ottoman capital. Michael Cantacuzenos owed his pre-eminence among the Phanariots to a fortune gained largely in the fur trade with Russia.82 According to one scholar, the Greek merchant colony of Lvov, perhaps fearing that the

competitive Jewish communities of the Balkans might push their trading northwards to link up with their brethren in Poland Lithuania, was active in the entourage of the Hetman Boris Chmielnicki, doubtless contributing to the horrible pogroms of 1 648-9. 83

The Greeks should not have feared Jewish competition in the trade between Muscovy and Constantinople, for Orthodox merchants had the

great advantage of being honoured guests in the Duchy. An Arabic-

speaking Orthodox cleric from Aleppo described that hospitality:

On investigation and inquiry, we found that most of those who came to Moscow in quest of alms, whether Archimandrites or common persons, do not come in the hope merely of what shall be given to them ; but they bring money, to make purchases of sables, ermines, and such like, that they may realize a great profit on their sale in Turkey. It is upon this principle that most of them come. From the time of their admission at Potiblia, till the moment of their return and departure thence, they are at no expense what- soever. If they have merchandise with them, they pay no duties, nor hire of horses, and they spend nothing for eating and drinking; for they have a pension, which they receive every month, each according to his rank; the very poorest has four copecks a day, with as much beer as he can drink. Thus

81 Such was the career of Cyril Lucaris, a Greek patriarch of Constantinople in the early seventeenth century, see B. Braude, 'A Greek Polemic of the Renaissance against the Jews', Association for Jewish Studies Newsletter, no. 16 (Feb. 1976), pp. 12-13.

82 Stephen Gerlach, Tage-Buch (Frankfurt, 1674), p. 454. 83 I thank Omeljan Pritsak for informing me of his views on these events.

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they ensure to themselves great profits, if they bring with them a large stock of money or goods.84

The Greek diaspora spread west as well. From the Venetian islands of Crete, Zante, and Corfu, and from the mainland, they flocked to the Serenissima herself, thronging her piazzi, canals, and fondachi with a colony of some 15,000 souls.85 Many of these souls had been reconciled to Rome, following the lead of such churchmen as Cardinal Bessarion; others remained true to their Orthodox heritage. Whatever their confession they pursued trade as vigorously as their brethren to the north - trafficking in the islands whence they came and venturing forth to the Greek mainland as well. The wealthiest among them could, like Thomas Flangis, preserve their cultural heritage with rich endowments to found a school.86 Others helped make Venice the centre of Greek printing. Venetian Greece, though not as celebrated as Romanian Byzantium, was an important Greek cultural centre. It was wealth gained through trade that made this possible. Astride the northern and western routes of international trade with the Ottoman Empire, the Greek trading network, though perhaps not as strong as the Jews within certain areas of the Empire and not as far-flung as the Armenians, was powerful and cohesive enough to last for centuries. Even the acceptance of Rome benefited the network, for

thereby Uniates could move as freely to the west and north-west of the Empire as the Orthodox did to the north and north-east.

Muslims did trade with Christendom. In 1580, a merchant named Ahmed was sent to England by the Threshold of Felicity,87 but such a far-ranging trade mission was an exception to the rule. Though Muslims lived and traded in the neighbouring ports of Ancona and Venice, they did not normally reach further into the continent.88 In the eighteenth century, and earlier as well, many Muslim merchants were trading Janis- saries,89 whose privileged position freed them from some of the impositions and costs to which other merchants were subject. These privileges did not, however, extend into Christendom. The stronghold of Muslim territories lay in the Empire itself and to its south, south-west, and east.

84 Travels of Macarius, i. 403-4. 85 G. Plumidis, Topolazione Greca a Venezia', Studi Veneziana, xiv (1970), 201. 86 Virgil Candea, *Les intellectuels de sud-est-europeen au xvii siecle', Re'vue des

Studes sud-est-europe'en, viii (1970), 201. 87 Ahmet Refik, Turkler ve Kiralice Elizabet (Istanbul, 1932), p. 18; and Susan A.

Skilliter, William Harborne and the Trade with Turkey (London, 1977), pp. 77-8. 88 Inalcik, 'Capital Formation', p. 112. 89 Carsten Niebuhr, Travels through Arabia, tr. Robert Heron (Edinburgh, 1792),

ii. 237-8. Tibor Halasi-Kun has informed me that trading janissaries were active in Buda in the seventeenth century.

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Even more significant than the details of the ethnic division of trade by territory were the implications they had for economic development. To understand this it may be useful to imagine a contemporary journey west- wards to London and Amsterdam : in the coffee-houses there we should find the merchants of the English and Dutch companies of the Levant and the East Indies gathered to discuss the price and quality of currants in Zante, wool in Salonika, silk in Aleppo, indigo in Ahmedabad, and pepper in Batavia; while in the counting houses would be the clerks, sit- ting high enough to handle their huge ledgers, patiently and with monoto- nous regularity entering the arrivals and departures of The Hercules, The Royal Merchant, Het Geluk, and De Fiefde on their voyages of trade in Levant seas and Indian oceans. These were the workings of the trading companies, which completely revolutionized commerce.90

The ethnic trading system had accomplished much in reducing the costs of trade: protection, negotiation, intelligence, and enforcement. It de- fended liberty and property, facilitated the search for customers, gathered and spread news of the market, and administered justice. But it failed to reduce the cost of credit, nor was that its only weakness, for the structure of the trade that evolved out of its cost-reduction method created ineffi- ciencies of its own : dividing trade by commodity, the ethnic system created

inflationary cartels; and dividing trade by territory, it segmented the pur- suit of commerce. Even among the wealthiest merchants and networks, the scale of activity was small. Furthermore, not only were there no overall

unifying organizations for trade, but there was no way such organizations could develop. In fact, unified organizations for trade were contrary to the very essence of the ethnic trading system, which depended upon and reinforced the very divisions within society that were to prove the obstacles to its growth and development.

Each trading network faced widely differing circumstances and chal- lenges. Trade with Venice or Lvov demanded methods different from trade with the Moluccas or Isfahan. Domestic trade differed from international trade. Janissary merchants had fewer problems than did Jewish merchants. Though networks competed with each other in many of the same markets, each network had its own area of trade with its specialized needs. The problems of trade were seen in particular terms. Methods of finance, systems for reducing risks, means of gathering information, and the other transaction costs were seen as problems distinctly different for Armenians than for Turks. As each network had its own peculiar market, *> This paragraph is based on a study of the Ledger Books of the Levant Company

for the seventeenth century, SP 105/157-69. See also K. Heeringa, Bronnen tot de Geschiedenis van den Levantsche Handel, I5go-i66o (The Hague, 1910).

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these differences were in fact real, with the result that no overarching solutions in the form of novel methods of organization could emerge.

The company solved the problem of credit and finance through the institution of joint-stock, which massed thousands of investors to finance hundreds of merchants with liquid capital. By spreading investment in commercial ventures broadly, it reduced the level of risk for any one investor. So successfully did the joint-stock company meet the challenge of this transaction cost that it was able to raise more money than any other commercial institution. Thus, where the ethnic trading network failed, the company succeeded.

The strength of the company was precisely that it was not a socially- based ethnic trading system. It did not depend on an ethnic diaspora to provide its agents, but established rational criteria in order to recruit, train, and dispatch men who would serve its needs. There was no domestic model for its structure; from its inception it was geared to international trade. In short, it did not grow organically in response to the stresses of a social milieu, but rather it was formed whole, constant in its purpose.

In the confrontation between the two, the ethnic system failed. The English Levant Company could take a loss on a woollen cloth in Istanbul because it could reap a profit on a silk in London.91 In the ethnic trading system, the competing networks of Muslims, Christians, and Jews could not make that exchange. The company did not organize its trade according to religious groupings: its trade was venture without faith. In the Balkans the ties of religion to livelihood were so close that business choices were determined by belief. In its trade, faith determined venture.

Boston College 91 See B. Braude, International Competition and Domestic Cloth in the Ottoman

Empire, 1500- 1650: A Study in Undevelopment', Review of the Fernand Braudel Center, ii (1979), 437-5 1.

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