The book before us, written by Hillel Gamoran, is a new mosaic relying partially on articles that Rabbi Gamoran had already published in major periodicals. This book is the first of its kind in that it describes developments about arrangements connected to the granting of loans and other monetary transactions. It begins with Moses and the written Torah, and their prohibitions on the taking of interest, and proceeds through talmudic discussions that present borderline cases (“dust of interest”) for which it is preferable to refrain from carrying out a transaction even if it is not prohibited in the Torah. Finally, it continues with a discussion of early and modern rabbinical decisors.
Economic conditions since the postbiblical period greatly expanded the extent of trade and monetary structures, giving rise to transactions that involved questions of interest. Not all economic developments were identical; a variety existed at different times and places. For this reason, Gamoran divides the book into five sections that, in his opinion, cover all aspects of the subject. The first section deals with primary economic development and considers the loan of products. A discussion on agricultural work and trade in farm produce leads into the second section, which deals with advance payment. A more advanced economic system involves purchase using credit; this is the subject of the third section. The final two sections are devoted to a wide-ranging and complex discussion of the questions of interest, mortgage, and investment.
The chapters' structures are heterogeneous and unique. Chapter 1 is devoted to the issue of prohibition of interest as dealt with in the Torah. Chapter 2 explains the infrastructure for the rest of the chapters and for the different subjects to be treated. The author analyzes talmudic sources both longitudinally (chronologically), dividing the sources into tannaitic and amoraic, and also laterally by subject. The third chapter is devoted to the loan of produce from the geonic period onward.
The Jews' residence in Islamic countries led to two contradictory effects. On the one hand, the Islamic legal prohibition on taking interest led to a stricter attitude toward interest in Jewish circles. On the other hand, Jews were granted considerable autonomy in trade and economic matters, leading to an accelerated development of sophisticated economic models (39). Because the Talmud already included different models for the loan of produce, the geonim had several precedents for their rulings. During the period of the geonim, the question at issue was whether a known rate in the market was sufficient to permit a loan of produce (45).
The dispute was resolved by the rishonim (early rabbinical authorities), probably due to continued developments in the economic sphere. There might also have been other factors. It is known that the loan of produce was permitted if a borrower was holding some stock of the produce or where the market rate for the produce was known.
A similar situation existed with regard to advance payment for produce. This question also involves interest payments, because if the price of the produce increases, a resale of the produce will net more than the original payment. Gamoran takes up this issue in Chapter 4. The tendency is to allow the transaction if one of two conditions has been fulfilled: (a) the buyer already has a stock of the same produce, or (b) the market rate is already known. The geonim ruled in accordance with these principles. They were followed by both the rishonim and the aḥaronim (59).
A central question concerning interest—of special concern in our period—involves credit. Purchase on credit is very common. Because the full cost of the item is not paid immediately after the purchase, there is an accepted economic principle that a purchase on credit costs more than a cash purchase. This type of transaction definitely involves interest. Indeed, an alternative name for interest is “cost of keeping”: A person pays for the additional time given to pay for the purchase. Chapter 5 discusses this matter.
Rabbi Yehudai, Rabbi Shimon Kaiara, and Rabbi Hai, three of the most important geonim, offered a simple and fair solution. The seller should fix a price and offer a discount to buyers who pay with cash (64). The author sees this as adoption of the talmudic law and disagrees with the researcher Abraham Udovitch, who ascribes it to the influence of Islamic law (66).
The period of the rishonim experienced detailed discussions about the question of credit. It appears that there is consensus in the case where the price was not fixed at the time of the transaction. However, produce sold by weight at a fixed price may not be sold on credit.
The period of the aḥaronim is characterized by lively discussions and an effort to facilitate trade by halakhic solutions to the problem of taking interest. There is almost complete agreement about accepting the solution introduced by the geonim and adopted by early authorities, whereby cash payments enjoy a discount. Many later authorities, including Rabbi Ya'akov Castro, Rabbi Mordechai Yafe, the Shakh, Lehem ha-Panim, and Hokhmat Adam, permit this type of transaction (81). The Meḥaber (R. Yosef Caro) quotes them in the Shulḥan Arukh (82).
Chapter 6 deals with mortgages. The Talmud presents different types of mortgage and rules that the Mashkanta de-Sura (the creditor writes to the debtor: “On the expiry of a certain number of years this estate reverts to you without any payment”) is perfectly permissible. The author does indeed claim that this is not a practical solution, and that it was never used in the geonic period (94). With regard to the Mashkanta be-Nakaita (for every year of possession the creditor must allow a fixed deduction from the debt; this can remove it from the category of loans and turn it into a temporary sale), the Amoraim are divided. The discussion apparently continued in the geonic period (105), lasting into the period of the rishonim. In the author's opinion, the rulings permitting the practice are post facto, and the rulings prohibiting the practice are ab initio (107). Throughout this period, the approach that permits the mortgage gains ground. Evidence shows that throughout this period the Mashkanta be-Nakaita was used extensively. We find this, for example, in the archives of the community in Alisana in Spain (113).
The period of the aḥaronim is characterized by new applications of the existing models. At the beginning of this time, Mashkanta be-Nakaita was still common in Europe, whereas in North Africa it was replaced by the resale (127). In later periods, the use of the Mashkanta be-Nakaita decreased.
The seventh and last chapter is concerned with investment. It delves into the issue of a partnership between a sleeping partner, who invests money, and an working partner. The Talmud rules that they should not share the expenses equally, to avoid the question of the payment of interest (133). There are three ways to avoid the question of interest in a partnership of the Iska type (as described in the next paragraph). One can share profits or losses unequally. If the two partners share these equally, then the sleeping partner should pay wages to the working partner (133). We would emphasize that in this type of partnership, there must be some risk with regard to the sleeping partner's investment.
In the middle period of the aḥaronim, an instrument called the Heter Iska was developed (which allowed the borrower and lender to agree to be partners in a business venture, so the investor-partner could thereby earn “profit” without it being characterized as a payment of interest). In the second aḥaronim period, most of the discussion centered on the question as to whether the Heter Iska was to be restricted to taking capital for use in a business or whether it could be for other purposes. Rabbi Braish permitted the use of the instrument for a marriage settlement (171). The Heter Iska became firmly established among the Jews. Rabbi Feinstein even ruled that the Heter Iska applied to a client of a bank who was unaware of its conditions (174).
The detailed survey leads to one very clear conclusion. At every opportunity where the sages could find a permissible halakhic method to allow a transaction and to promote economic progress, they did so. In every case, real interest was not involved. Nonetheless, we are discussing borderline cases (Avak Ribit), for which the talmudic sages offered solutions to solve the problem of interest. They prepared the way for later authorities; the methods grew more sophisticated and developed up until our period.
The author does not restrict himself to a statement of the opinions of different halakhic authorities but uses outside sources and different research methods to present a more complete picture. For example, the reader is introduced to the laws of the ancient Near East (4–5), in particular, to the legal structure of the Jewish colony of Elephantine in Egypt (13). In later periods we learn about the Muslim environment (45) and the commenda (funds from an investor) which was practiced among Christians and its relationship to Muslim law (64–65;148). Even documents from the Cairo genizah are used (70).
The analysis of geonic literature is also carried out from a general perspective. For example, the author presents the disputes on the Mashkanta be-Nakaita between the two yeshivas, Sura and Pumpeditha in the context of their other disputes (99). The author was also in a position to hazard opinions regarding which geonim knew their predecessors' work and which did not (45). This facilitates an understanding of the nature of geonic literature (40).
Although the payment of interest is primarily a halakhic question, it cannot be separated from its economic context, as the author points out. In many cases, he connects the changes in halakhah with rapid developments in trade (39, 46, etc.).
I would, nevertheless, like to present some reservations that do not, however, denigrate the brilliant content of the book before us:
1. The question of resale is indeed connected with that of mortgage, but the question of mortgage seems to have superseded this issue, even though they should have been discussed separately. In my opinion, because the Talmud separates the transactions, it is preferable to call it a “resale” rather than a “conditional sale” (as the author refers to it on p. 94).
2. In addition to the treatment of personal and family reasons for disagreement among the sages, it would be helpful to consider the version that each sage possessed of the talmudic text; these would have bearings on the interpretation of the talmudic discussion.
3. I found a few misprints: (a) The name Abdallah is added to Rabbi Yosef Hayyim; (b) p. 4, note 1 should be Lev. 25:36–37; (c) p. 21, note 26 should be M. Arakhin 9, 3; (d) on p. 34, second paragraph, the reference to Rava in the Talmud in note 71 is incorrect; (e) p. 51, note 46 should refer to 16:34.
These minor flaws do not detract from the value of this important book. It is of importance to researchers of the Talmud, of Jewish law, and of halakhah, as well as to the general reader.
