Tomás de Mercado
Tomás de Mercado was a Spanish Dominican theologian who lived during the 16th century. He was born in Seville, the epicenter of trade with America. He was a member of the School of Salamanca. In addition to theology, he was interested in the arts and economics. He was a strong supporter of free trade, criticized usury and monopolies. One of his intentions was to establish a moral guide for merchants to set fair prices for their products.
Tomás de Mercado was born between 1520 and 1523. Very young he went to the New World. Around 1540, he headed to New Spain (today Mexico), where he studied with the Dominicans. In 1553 he joined the order, starring in a rapid ascent through the different orders. In just five years he was ordained a priest. He served as Lector of Arts, until 1562, when he returned to Castile to study theology. He enrolled at the University of Salamanca. It is for this reason and for his thinking that he is considered a member of the School of Salamanca. Later he taught philosophy, moral theology and law at the Colegio de Santo Tomás de Sevilla. He was also a moral adviser to the merchants of this city.
Twelve years after his arrival in Spain he embarked to return to New Spain. However, he did not set foot on American soil, since death came to him on the high seas, affected by severe fevers. His body was thrown into the water near the coast of San Juan de Ulloa.
Thought and work
Tomás de Mercado moves between two worlds. On the one hand, it maintains positions consistent with the last bars of the Middle Ages. On the other, it incorporates nuances that fit into Renaissance thought, although it cannot be considered as such.
His most important works are Deals and contracts of merchants and traffickers and Sum of deals and contracts . In them the influence of authors that preceded him, such as Vives, Porfirio, Pedro Hispano or Santo Tomás is perceived. Like other thinkers of the School of Salamanca, he devoted special attention to the quantity theory of money. He was also interested in logic. In this field he published In logicam magnan Aristoteles Commentarii 1571, a translation, with comments, of Aristotle's work.
The economic thought of Tomás de Mercado can be seen in his work Sum of deals and contracts. Actually, it is a reissue of the one published two years earlier, but with some important nuances. In it, the Sevillian thinker reflected on the basis of interests and condemned usury, like Martín de Azpilcueta, another member of the School of Salamanca. He also delved into the Quantity Theory of Money. Concern for these issues seems logical, in a context characterized by the massive arrival of precious metals from America.
Sum of deals and contracts
The work is divided into two parts. In the first, he explains natural law and the principles of positive law, both fundamental for analyzing contracts. In the second, it describes the different forms of commercial activity and the principles that must be followed to establish fair prices.
Tomás de Mercado defends the commercial practice and believes that its effects are positive. However, he is concerned about an increasingly widespread practice, trade on credit, especially that carried out with the Indies. Thus, he criticizes those who take advantage of this practice to unjustifiably increase prices, accusing them of practicing usury.
Similarly, it warns about the existence of monopolies, which negatively interfere with prices. He points out that in monopolistic situations, whoever dominates the market imposes prices unilaterally. It can also create situations of artificial shortage of a certain product to alter its price upward.
Faced with these problems, he considered that the public powers should intervene to guarantee the proper functioning of the market, free competition and the fair application of interests, to avoid usury. An intervention especially aimed at basic necessities, with the aim of preserving the general interest.
Its objective: to combine economy and morals
The work of Tomás de Mercado has a double dimension, since the objective was to develop a practical guide to moral action for merchants, while trying to establish a guide for merchants to act morally, while trying to develop a comprehensive economic theory focused on the common good. All this with the aim of combining morality with the economy.
The work of this thinker had a notable influence on later times. The scholastics who followed him, such as Medina, Lessio or Lugo, are examples of this. But it was already in the twentieth century when it was rediscovered and rescued. Especially relevant was, in this sense, the Chicago School, headed by Milton Friedman, who, like the Sevillian, devoted a great deal of effort to the quantity theory of money.