Published by EH.NET (June 2008)

Adrian R. Bell, Chris Brooks and Paul R. Dryburgh, The English Wool Market, c. 1230-1327. Cambridge: Cambridge University Press, 2007. viii + 205 pp. $99 (cloth), ISBN: 978-0-521-85941-7.

Reviewed for EH.NET by James M. Murray, Department of History, Western Michigan University.

English wool was a medieval commodity whose production, acquisition, exchange, and manufacture launched countless ships, occupied many merchants, and kept the looms of Flanders, England, and Italy humming. Some (but by no means all) of this wool was simply the world’s finest raw material for the production of high quality cloth, one of medieval Europe’s most successful exports. And it was in chronically short supply in the period covered by this study, really the reigns of the three Edwards, kings whose efforts to tax wool exports are also part of the story.

The cooperative research project by scholars from two UK institutions (University of Reading and King’s College, London) that led to this book and three related publications is a model of efficiency and usefulness, although the articulation among its various parts is unclear. The first product was an edition and translation of 203 wool contracts published in 2006 by the National Archives, Kew (formerly Public Record Office), summaries of which are also available in an online version at, study number 5325.[1] The series from The National Archives used were: Close Rolls (C54); Exchequer Miscellanea (E101); Memoranda Rolls (E159 and E368); Plea Rolls (E13); Ancient Deeds (E210, E236, E237); and Special Correspondence (SC1). Appendix 3 of the book gives a spreadsheet overview of each contract including its chronological order, reference, list of buyer(s) and seller(s), and summary of contract contents. This database alone puts an enormous quantity of new primary source material within easy reach of scholars.

On this evidentiary basis, the coauthors have published two journal articles besides the present monograph, the first, in the Journal of Medieval History the second in Journal of Banking and Finance. The former is a more or less straightforward version of the monograph’s chapter 3, and the latter is a significantly different version of the book’s chapter 4. The salient difference between the journal and book versions is the inclusion of a more extensive apparatus mathematicus in the JBF article including formulae and an additional table showing “regression results of tests for market efficiency.”[2] The intent here was obviously to tailor the presentation of the data analysis to the more or less numerate among interested scholars, but what is curious is that the book contains no reference to the article nor any mention that chapter 4 contains the same text but a pared-down presentation of the mathematics.[3]

The subject of the English wool trade could hardly be more important in the economic history of medieval England in particular and medieval Europe in general. As previous research has shown, from the eleventh to mid-fifteenth century wool was England’s dominant export ? at its height amounting to some ninety percent of revenues, and even in the subsequent period of decline from c. 1450 to 1650, wool in the form of English cloth was an equally dominant export in terms of trade value.[4] Yet the authors point out that the bifurcation of research into the subject by economic historians on the one hand and historians of the local and monastic economy on the other has obscured “important details” due to the neglect of “any concerted attempt to explore the fuller extent of the source base.” In other words, this is an innovative study of these particular contracts using the methodology of modern finance theory, not a general history or even a replacement of the seminal works by Eileen Power, T. H. Lloyd, and John H. Munro.

Nonetheless, the authors succeed in presenting conclusions that if not revelatory do make a solid contribution to the literature and make a persuasive claim for the financial acumen of late medieval merchants and woolgrowers. Their conclusion that “not only options, but instruments akin to forward contracts were in widespread use throughout the thirteenth and fourteenth centuries,” adds to the list of innovations whose origins must be pushed back to the late Middle Ages rather than more modern periods. Future historians will also be in the authors’ debt for the richly nuanced picture of a market under stress, where competing parties engaged in “cutthroat” competition for position as buyers in the market, while producers pitted potential customers against each other in an attempt to repair and restore shaky internal finances.

Chapter 3 gives a micro-study of these market dynamics by presenting the case of Pipewell, a Cistercian abbey of middling importance in Northamptonshire, whose history is richly illustrative of the storm and stress in the wool market from c. 1270 to 1325, the period of the greatest number of forward contracts. The majority of these contracts were made between Italian merchants and monastic institutions, most, like Pipewell, were Cistercian houses. Pipewell, however, occupied a particular niche as a small, super high quality producer whose product commanded top market prices. The decades-long travails and virtual bankruptcy of the abbey provide both a cautionary tale and window into the economic forces that shaped the wool market.

Pipewell was atypical in that its chief creditors were a firm of Cahorsin merchants instead of the more common Lucchese and Florentine firms, but it was all too typical of many English Cistercian houses in selling for ready money promises of wool delivered at a set price in the future. This seemed a good bargain for both parties, as Pipewell Abbey needed to complete building programs and the Cahorsins were eagerly seeking wool supply ahead of their Italian competitors. Innocent in the 1270s, such debt for wool swaps proved disastrous for monasteries across England by 1300, as animal disease decimated sheep herds reducing the wool clip and thereby the abbeys’ ability to meet their contracts. This kindled “those fires of indebtedness which gutted English Cistercian houses late in that [thirteenth] century.” Exacerbating problems of supply were new taxes levied by the English crown, disruptions in the market caused by war, and numerous protracted law cases. Pipewell was forced to refinance contracts, accept sheep from its creditors in order to build herds, and appeal for royal protection. Even these efforts at retrenchment could not withstand the terrible famine and murrain of 1315-1322, which even contemporaries called the “magna caristia,” and the abbey was temporarily dispersed. Thus ended a struggle to stay afloat extending over some forty years.

Chapter 4, “Modern Finance in the Middle Ages? Financial Aspects of the Advance Contracts for the Sale of Wool” is the most innovative in its use of “valuation techniques from ‘modern’ finance theory to analyze the large number of advance contracts” in order to ascertain the implied interest rate of the transactions and to assess the efficiency of the wool market. As stated above, a mathematically more complete version of this chapter was published in a specialized journal, but most historians will find enough of the quantitative underpinnings to assess the argument. After a disclaimer clause about the difficulties of applying financial analysis to such a small evidence base, the authors conclude that the forward agreements with money accepted for delivery of future wool sacks include an implicit interest rate of 20 to 27 percent given the discount over the spot price of wool promised in the contracts. Variations between the extremes can be accounted for by the creditworthiness of the abbey and strength of demand by the merchants. This rate accords well with interest rates of other loans across a wide variety of church and urban economies.

Market efficiency is judged by how closely the forward price predicts the subsequent spot price of wool. The authors seek to test this for the medieval wool market by isolating data from the first year of a forward contract leaving sixty-three observations. The influence of additional variables ? such as the length of the contract, the size of the contract, and even which monastic order was involved ? on the discount rate is also taken into account. Given these, and a comparison with modern wool trading in formal exchanges, the authors conclude that “the medieval wool forward market was remarkably well functioning and orderly” (p. 144).

In chapter 5, the conclusion, the authors recapitulate their findings and seek to answer some nagging questions. The finding that “modern finance is perhaps not so modern after all” reminds us of the remarkable ability of merchants of all times and places to solve practical problems in order to do business. The fact that the forward contract disappeared in the face of changing market conditions shortly after 1325 shows us as well the anachronism in measuring the medieval past by the standards of modern finance. The genius of medieval merchants was in adapting and adopting tools to cope with and circumvent the very difficult conditions of late medieval Europe, not in inventing modern finance. The search for modernity has been a besetting sin of past economic history, though using the tools of modern mathematical economics, as is done in this study, can lead to useful insights about the economies of past times.

Notes: 1. The book does not make clear that the full text of these contracts will only be available online by Autumn 2009 at the earliest due to copyright considerations. A. Bell, C. Brooks and P. Dryburgh, Advance Contracts for the Sale of Wool, c. 1200-1330 [computer file], Colchester, Essex: UK Data Archive [distributor], March 2006. SN: 5325 and eidem, Advance Contracts for the Sale of Wool c. 1200-1327 (List and Index Society, 315 London, 2006.

2. “Interest Rates and Efficiency in Medieval Wool Forward Contracts,” Journal of Banking and Finance 31 (2007) 361-80.

3. “Leger est aprendre mes fort est arendre: Wool, Debt, and the Dispersal of Pipewell Abbey (1280-1330),” Journal of Medieval History 32 (2006) 187-211. The JMH article mentions in footnote 7 the existence of the JBF article. There is a third not readily available article mentioned in footnote 7 as well.

4. See on this John H. Munro’s review of the edition of the contracts in Agricultural History Review 55 (2007) 311-12.

James M. Murray is director of the Medieval Institute at Western Michigan University in Kalamazoo, Michigan. He has published on the history of medieval business and the urban economy of Bruges in the late Middle Ages. He can be reached at