Interest in medieval accounts: Examples from England, 1272-1340

Abstract: Research into medieval interest rates has been hampered by the diversity ofterms and methods used by historians, creating serious misconceptions in the reporting of medieval interest rates, which have then been taken at face value by later scholars. This has had important repercussions on the wider debate on the credit risk of different forms of medieval governments and the costs of borrowing as a bar to investment. This paper seeks to establish a standardised methodology to accurately calculate interest rates from historical sources, which will provide a firmer foundation for comparisons between regions and periods. It also supports other recent literature suggesting that medieval economic and financial development was more advanced than previously portrayed. The paper is illustrated with case studies drawn from the credit arrangements of the English kings between 1272 and c.1340, and argues that the variations over time in interest rates charged reflect the contemporary notion of credit worthiness as it applied to the medieval English Crown.