Diffusion and Refinement of Practice.

Historians have already noted the high level of literacy of Florentines in the fourteenth century, but have hardly remarked their numeracy as well. Keeping track of one’s debtors and creditors must have been a pressing problem in the booming local marketplace of thirteenth-century Florence. In the course of the century, the population grew (by very rough estimates) at the astounding rate of five to six times, reaching well over 100,000 by 1300, making the city one of the four or five largest in Christian Europe (and perhaps the fastest growing). Moreover, Florence, unlike Europe’s other great cities, was an industrial center; thus, economic relations were intense, complex, highly fluid, and thoroughly monetized, and the velocity of monetary exchange increased all the more as a result of population growth. The monetary nexus was further complicated by a bimetallic system (but not one tied to a bimetallic standard) rendered inherently unstable by the constantly fluctuating gold–silver ratio, debasements, and varying moneys of account, not to mention what Carlo Cipolla called “the big problem of small change”—the lack of coins in very small dominations.

Florentines thus found themselves caught up in a web of continually shifting credits and debits that required some kind of record keeping. Primitive tally techniques hardly sufficed—so they learned to keep accounts. Accounting served as a memory aid, not as a technique for knowing, let alone analyzing, the results of economic activity. What today we call a ledger (mastro in today’s Italian) they, in fact, called a “book of debtors and creditors” (libro di debitori e creditori); this appellation stuck, surviving into later times whether the book was opened for one’s private affairs or for an international bank and whether it contained impersonal as well as personal accounts. From a written record of monetary exchanges, it was just one step to have recourse to offsetting (payment made by the shifting of debits and credits on one’s books from one person to another) and hence to the appropriate instruments for ordering such transfers, or orders of payment, including the check.

Judging from the surviving archival evidence, just about everyone (including some women), from working people with a wide variety of skills to the city’s prominent entrepreneurs, kept accounts. Many of the very earliest surviving accounts––those from the thirteenth century––were kept not for business activities, but for private administration of one kind or another: management of property in the countryside, settlement of estates, or simply daily activity in the marketplace. The impulse to handle monetary exchanges as paper transactions gave rise to a legal system that already by the time of Dante, sidetracking the notary, recognized the validity of a personal accounting record in the settlement of debt claims and severely punished fraud and any tampering with business accounts.^{Footnote 5} Statutes of many of the city’s artisan guilds dating to this early period required members to keep accounts; court records through the following centuries document the heavy traffic of disputants’ accounts, including those of artisans, that passed across the judges’ desk for inspection.

By the late fourteenth century, the practice Florentines in general—not just businessmen—followed in keeping accounts was standardized throughout the population and highly refined with respect to techniques and formatting. The Florentines followed formulas in making entries: The first entry on each side of an account carries the name in which the account is opened, and following entries are introduced by the date, the phrase for debited or credited (de’dare or dev’avere [“must give” or “must have”], or the plural forms thereof), the amount of the transaction, and then any further information the accountant thought necessary. In making entries, they used a standardized language, a kind of jargon: addì (on the day of), pagato al portatore (pay the bearer), ponete al mio conto (post to my account), posto in questo a (post herein at), monta in tutto (totals), infrascritto (written herein), contrascritto (written opposite), detto (said), per lui a or da (for him to or from), and, for cash transactions, portò (took away in cash) and recò (brought in cash) alone. The modern reader might be put off by the use of Roman numerals for monetary figures in the extension columns, but this practice slowly gave away to the use of Arabic numerals, which were universal by the end of the sixteenth century. Already by the fifteenth century, however, figures in the text of entries were in Arabic numerals, which had always been used in making calculations (as we know from the many surviving arithmetic manuals dating back to the early fourteenth century). The advantage of Roman numerals, according to opinion at the time (and encapsulated in guild regulations) is that they made tampering with accounts more difficult. In any event, for anyone familiar with them it is as easy to add columns of Roman numerals as it is to add Arabic numerals, perhaps even easier: their use, at least for addition, was not the retardataire practice that much of the literature makes it out to be.

Striking, too, is the physical presentation of accounts. The major innovation that brought practice into familiar visual focus for the modern eye came in the later fourteenth century, with the introduction of the bilateral or tabular format—today called the T account—with debits on the left side and credits on the right side of the two facing pages, or “openings,” of an open ledger, and both sides—hence the account—with the same page number (usually one in Arabic and the other in Roman numerals). The oldest example of this format dates to 1382; the fact that in his incipit of the ledger the accountant announces his intention of formatting the accounts alla veneziana (in the Venetian way) and then describes what this means (cioè nell’una carta dare e a rinpetto l’avere—that is, debits on one page and credits on the page opposite) would indicate that it was something relatively new for Florence but had been in use in Venice before that time.^{Footnote 6} Accounts were visually clarified, too, by the formatting of entries: the text of entries on the left side of the page clearly demarcated by overhanding first lines, exclusive use of Italian (whereas Latin was used in Genoa and, at least into the fifteenth century, in Milan), monetary figures entered in extension columns on the right, exclusive use of moneys of account, cancellation of closed accounts using a single diagonal line across all the entries, and extensive—but not yet systematic—use of double entry with appropriate cross references.

Surviving private account books of all kinds from the end of the fourteenth century onward exemplify this highly standardized practice. Certainly not to be overlooked in all this evidence for the high level of competence Florentines had in keeping accounts is their extraordinary discipline in making entries: There are occasionally—but only very occasionally—arithmetic errors, but hardly ever corrections and erasures in the text of entries. What most needs emphasis in discussing this aspect of Florentines’ numeracy is its evidence in personal as well as business accounts: From a purely formal point of view, the personal accounts of many of these Florentines, not all of whom were in business, are every bit as sophisticated as the most advanced business accounts.

The city’s merchants, bankers, and cloth manufacturers obviously had objectives requiring more complicated accounting procedures than those needed for purely private affairs, especially given that they operated not individually, but through partnerships with the attendant responsibilities, and their records alone are the ones that have attracted historians of early accounting practice. Raymond de Roover’s classic article on business accounts succinctly lays out the evolution of all the highly sophisticated techniques that Florentines developed from the early thirteenth through to the end of the fifteenth century. Already in the fourteenth century, examples of practices—albeit hardly universal, some barely adumbrated, and none fully integrated into a comprehensive double entry system—can be found that illustrate the sophistication of practice: the presence of nominal, or impersonal, accounts (opened in the name of things, including profit–loss and equity accounts), accrual accounting, cost accounting, offsetting, depreciation, deferred payment, holding of reserves, explicit charging of interest, casting of periodic balances, and the complete separation of business from personal and patrimonial affairs.

The accounting records of many businesses consist of a variety of specialized interlocking auxiliary, or waste, books: giornali, libri di entrata e uscita, quaderni di cassa, memoriali, ricordanze, libri di mandate (journals, income and expenditure journals, cash books, record books, diaries, books of shipments) and a variety of quadernucci (notebooks), depending on the nature of the enterprise—a rather far cry from Pacioli’s prescription for only two principal auxiliary books. The set of some thirty-five interrelated books dating from 1367 to 1373 that survive for Francesco Datini’s company at Avignon have been exhaustively studied by Franz-Josef Arlinghaus, who broke them down into eight different types.^{Footnote 7} By the fifteenth century, these books were standardized in size and identity: Ledgers were usually half folio-size (reale), often bound in leather; subordinate books were commonly in quarto (mezzana), with vellum covers; and all these could be bought ready-made at a stationer’s shop with covers (if vellum) already titled to indicate the type of book and with pages columned by watermarking. The ledger had its own distinct identity, often being bound in tooled colored leather; its standardized incipit included the year, a brief formulaic invocation of saints, the name of the owner or company, type of book, the color of the cover (if a leather-bound ledger), a letter indicating its place in an alphabetic series (thus libro giallo segnato B di debitori e creditori [the yellow ledger marked B]), and perhaps a business logo. The auxiliary books are often identified by the same letter and color of the ledger to which they are subordinated. By the sixteenth century, a company ledger, many of which by this time consisted of up to four hundred folios or more, was often supplied with a detachable alphabetically tabbed (and later even sub-tabbed) index to the accounts therein.

Finally, there is double entry. Of all the advances in technical aspects of accounting, this has most caught the attention of accounting and economic historians because of its implications for the very purpose of keeping accounts. They much debate its origins, but its first appearance in private account books, rather than in government records (as in Genoa and Milan), seems to be in Florence.^{Footnote 8} The doubling of some entries—that is, entering one item both on the credit side of one account and on the debit side of another, complete with cross reference—was certainly in use by the end of the thirteenth century, and in the course of the following two centuries the practice evolved into a veritable system with all entries doubled. De Roover—who brought common sense to his handling of the subject as well as the expertise of one who had started out his career in business, not to mention his university education in both history and economics—is, however, not altogether content with asserting the presence of double entry simply on the evidence of a cross-entry for each entry in the ledger. He insists instead on what uses such a method served—drawing a balance, recording equity, and determining profits and losses—and he was satisfied that all these features could already be found in the fourteenth century, although the evidence is fragmentary. Reasoning backward from accumulation of these features, de Roover was more confident about several of the fifteenth-century Medici ledgers, but he did not have the evidence for all the necessary proof.^{Footnote 9}

It is not without more than a little irony, in fact, that de Roover and Federigo Melis, for all the persuasiveness of their arguments about the development of double entry in Florence, never came up with a single ledger that exemplifies a thorough application of the technique in any one set of business accounts––and, indeed, to date none has been found for any Florentine firm prior to 1500. However, this older generation of scholars who studied the history of double entry through Italian documents more than a half-century ago stopped their inquiries at the end of the fifteenth century, presumably content with having established its affirmation (or perhaps victimized by the traditional periodization of the Renaissance).^{Footnote 10} If taken further on into the sixteenth century, however, the application of double entry turns out to be much more complex, both as a technical and cultural phenomenon, than heretofore conceived. We shall pick up that story after a glance back at the broader social context in which accounting practice emerged in the first place.

Learning the Skill

The prominent place accounting so clearly had in the cultural baggage of Florentines is further evidence of the high degree of literacy and numeracy in the city. But where did they pick up this particular skill? Hardly any evidence exists for its presence in a formal educational program, although the uniformity of practice and the discipline of its application, as well as its wide diffusion throughout the society, would suggest not only that—at least for this subject—Florentines shared a common learning experience but also that that learning resulted from the kind of severely rigorous training by rote characteristic of primary education in the pre-modern period.

The formal education of most Florentine boys, including artisans, took place in two schools. From the ages of around seven to ten or eleven they attended an elementary school to learn how to read and write; and then, at the age of eleven or twelve, many of artisan status and above went on to what was called an abacus school (scuola d’abaco), where they spent several months, or perhaps as long as it took, to learn the basic practical arithmetic needed to make their way in the marketplace. Very few went on to a third stage, the grammar school, to study Latin. It seems that elementary and abacus schools were two distinct organizations in Venice as well.^{Footnote 11}

Children probably learned something about writing out account entries in the earlier reading-and-writing schools, although what we know about the didactic program of these schools is entirely anecdotal. According to his contemporary Vespasiano da Bisticci, Giannozzo Manetti (1396–1454) learned what a prospective merchant needed to know (quanto s’apartiene a uno che abbia essere mercatante) at such a school before going on to the abacus school.^{Footnote 12} Some Genoese notarial contracts with teachers specified that the elementary program of reading and writing was directed to the practical need of merchants, including the keeping of accounts. The simultaneous teaching of basic writing and keeping accounts has been inferred from the fragment of a fifteenth-century Umbrian teaching manual; this may have been common practice in the communal schools outside Florence.^{Footnote 13}

In contrast to the reading-and-writing schools, the abacus schools are well documented—by one contract with a teacher laying out the didactic program, by the occasional memorandum a father entered in his record book (libro di ricordi) on enrolling a son in the school, by around 150 surviving manuscripts of treatises on commercial arithmetic (trattati d’abaco) dating from as early as the late thirteenth century through to the sixteenth century (a few have been published), by studies of the level of mathematical knowledge reflected in these tracts, and by Elisabetta Ulivi’s exhaustive ongoing research to identify these schools and their teachers.^{Footnote 14} None of this material, however, reveals, anything specific about the teaching of accounting practice—jargon, formatting, organization of accounts—apart from general arithmetic skill. The treatises lay out the four basic arithmetic operations (some go on to add a little algebra) presented as practical, everyday problems, though, for didactic purposes, of very considerable complexity. Many of these problems fall into the category of business—money, prices, exchange, mensuration, barter, partnership, interest, discount—but none explains how to keep accounts of monetary transactions. A treatise, however, was less a teaching manual than an aide-mémoire, a kind of how-to book, for former students––and perhaps for teachers as well––to be consulted as the occasion arose.

Very occasionally, a treatise illustrated the solution to an arithmetic problem in a way that assumed at least a basic knowledge of elementary accounting practice. When it was a matter of debits and credits and a changing balance over time on which interest was being charged, the problem and its solution were recapitulated in what could be ledger entries, and some of these were laid out as illustrations set off from the text by the use of red ink or what we might call the format of a table. Thus, in a treatise dating from around 1330, the illustration starts off with two debit entries (the text in Italian gives the full sense of the accounting practice used):

Other debit entries follow, and then come the payments, illustrated again by what could be credit entries in an account book:

Finally, after the explanation of how to calculate the interest due on the changing balance, comes a final entry with the total:

Illustrative material of this kind, however rare and limited, in the trattati d’abaco already in the first half of the fourteenth century suggests that readers had some familiarity at least with the jargon and formatting of accounts.^{Footnote 15} As for abacus teachers, they obviously knew something about accounting practice. They were frequently called on to check company accounts as well as those of the city’s political and ecclesiastical institutions, and we know of at least two who became purveyors and managers of a monastery (one at Santa Croce, the city’s major Franciscan house); some of the accounts of one of these kept on the job survive.^{Footnote 16}

The question about which of the two primary schools taught accounting may become moot as we move toward the end of the fifteenth century, when, according to a hypothesis of Ulivi, teachers from both schools moved toward merger. In 1494, a teacher of reading and writing and two abacus teachers made a contract for organizing a school together; ten years later, in 1504, Lorenzo di Giovanni Ruspoli sent one of his sons to the school of ser Simone, teacher of reading, writing, and arithmetic (maestro che ‘segna legiere, scrivere e l’abacho), to learn how to become good at writing and also at arithmetic (iscrivere letere merchantile e letere firmate e l’abacho, a rischore perché e’ venissi buono iscritore e così buono maestro d’abacho [to teach him to write commercial and signed {?} letters and arithmetic; to be paid so that he becomes a good writer and also a master of arithmetic]).^{Footnote 17} However, no one has yet investigated popular schools in sixteenth-century Florence to find out anything about the presence of accounting in the curriculum. By this time, the subject was being taught in schools in Venice, southern Germany, Antwerp, and, by the end of the century, also in Holland.^{Footnote 18}

Whatever boys just entering their teens knew about accounting when they left school must have been sufficient as a basis for improving their ability through practice and experience so they could keep accounts for their personal affairs. The relatively few who headed for a business career, instead, had much more to learn; the process began immediately after leaving school on taking a job in the office of one of the city’s major industrial or commercial firms. Many biographical memoranda document that the first task on the job was keeping track of movement in the cash box—a simple task, but one that posed enough risk for the employer that he might require the boy’s father to promise reimbursement for any shortfall in the cash box, or even to make a security deposit. The youngest Florentine known to this writer to open a ledger that still survives, being only fourteen, was at the most no more than two years on the job in the office of a wool firm at a beginner’s salary of 20 florins a year (much below what an unskilled laborer could earn) when in 1406 he opened his own libro di debitori e creditori. The accounts reveal the hand of a boy still uncertain in his penmanship (and, to judge from the ink blotches, even the use of a pen) and occasionally compelled to make cancellations and corrections, but one who clearly knew the jargon and formatting of accounting practice at the time.^{Footnote 19} The typical career pattern consisted of assignments that led through the hierarchy of accounts to the keeping of a ledger, a process described explicitly in some personal record books.^{Footnote 20}

Given the universal knowledge of this skill in a city so noted for the survival of practical manuals of an economic nature—all those abacus manuals along with a half-dozen or so merchant manuals and manuals for the two major industrial activities (wool and silk cloth manufacturing)—the lack of a manual on accounting is somewhat curious (whereas no fewer than five publications on accounting appeared in Venice during the second quarter of the sixteenth century).^{Footnote 21} Perhaps no accounting manuals were ever written in Florence (and later none were ever published there) because, quite simply, there was no demand for them, the keeping of accounts being virtually second nature for many Florentines. If there had been just one such Florentine manual, the historiography on early accounting practice, based as it is in the tradition deriving from Pacioli, directed to single operators who had no obligations to partners and did not separate business from personal affairs, would certainly be very different, as we shall see.

Professionalization

Today the Italian term for accountant is ragioniere, but in our period the term had no professional implications. In the incipit of some abacus treatises, the objective is stated as explaining how to solve arithmetic problems (called ragioni), how to ragionare (meaning “to calculate,” but sometimes specifically “to do addition”), and how to become a ragioniere. In the memorandum Lorenzo Ruspoli made in 1507 of his agreement with the abacus teacher Marco di Jacopo Grassini for the instruction of another son, he noted the down payment of one-half the fee and added that the balance would be due when Grassini took up the subject of ragioneria (quando egli enterà ne’ ragionier) and finished teaching arithmetic and produced a good ragioniere (e agli à finito d’isegniare tuto l’abacho e fato un buono ragioniere).^{Footnote 22}Ragioniere, however, was a term the government and other institutions sometimes used to identify the men called in to check accounts, but calcolatori and, perhaps to a lesser extent, computisti were also found. In business records, from the fourteenth through to the early seventeenth century, a salaried accountant was always referred to as scrivano (scribe), a term used with the same sense in government and guild statutes. In the business jargon of the time, ragione (about the only form of the word found in business records) was the standard term for the accounting period of a distinct partnership contract.^{Footnote 23}

The presence in fourteenth-century documents of men whom public and ecclesiastical institutions as well as private companies called in to overlook, or audit, their accounts indicates that something of a freelance profession was emerging. The only one of these professionals whose activity can be documented is Michele di Nofri Del Giogante (1387–1463), a prominent popular poet, author of a treatise on memory, and friend of Cosimo de’ Medici. In his 1427, 1430, and 1433 tax reports, Del Giogante identifies himself as a ragioniere; among his outstanding credits he lists unpaid fees for his accounting services (per una ragione riveduta) that indicate the considerable level of his activity. His indebted clients included the state Office of Wards, the city’s major hospital, two banks, a firm of soap manufacturers, a dye house, and a used-cloth dealer, as well as many private persons, some of them from the city’s leading families. He rented a shop (bottega) and paid one employee, although he gives no indication that this was an office out of which he ran his accounting business. For some of these audits he had a partner, two of whom are mentioned as sharing the fee (his own share, with one exception, amounting to over 50 percent). Moreover, he claims that some audits could take several months and that his fees were as high as sixty-four florins—equivalent to the annual earnings of a skilled construction worker—but both these dimensions to his work were so high that one suspects that they represented more than the charge for an audit. In fact, in a long note appended to his 1433 tax report to explain some of his as-yet unrealized income, he revealed that as auditor he might also go on to serve his client as bill collector, for he referred to agreements by which he was to have a cut of 20 to 40 percent of the amount he was able to collect on the debit accounts he had audited.^{Footnote 24}

By the sixteenth century, specialists called in not just to do an audit but also to keep accounts on a part-time basis show up in business accounts. The silk weaver Iacopo di Tedesco, who, in partnership, ran a large workshop for nearly half a century, from 1490 to 1533, kept the income–expenditure journal and other secondary books; notwithstanding the thorough knowledge of the practice these accounts reveal, he called in an outsider, a scrivano, to post the firm’s ledger. Most of the firm’s books survive, and one can see the tick marks that the scrivano made in checking the income–expenditure journal kept by Jacopo against the cash box before going on to post the ledger. The modest stipend for this service, never adding up to more than several florins a year, would suggest that it did not take much time to do the job. Unfortunately, we know nothing else about the accountants Jacopo di Tedesco called in—whether they were full-time freelance professionals or men simply willing to take on a little extra work. Some in this latter category occasionally surface in the documents. Stefano di Giovanni Parigi, who worked in the wool industry, made an entry in his personal book of accounts and memoranda that in 1586 he took a salaried job (at one florin a month) with a wool firm, working only at keeping the cash book, specifying that he did nothing else for this business (later he had his own wool shop). A somewhat improbable figure in this history of the professional accountant is the famed composer Jacopo Peri (1561–1633). Although educated as a boy singer in a monastic school, he demonstrated a standard knowledge of accounting practice (including partial double entry) at the age of nineteen in opening his own private ledger; in the course of keeping his accounts, he occasionally added comments indicating that he was improving his skill on the job. In fact, later in life, when he was just over forty years old, he took a job for several years as cashier with a wool firm, which gave him part-time but regular employment, earning twenty-four florins annually (his only such job so far as we know); with his singing career in the past, he ended his life in the major position of comptroller and accountant for the guild of wool manufacturers with a salary of 120 florins (out of which he paid an assistant).^{Footnote 25}

Some of these men may have made a living serving as auditors and part-time accountants, but so far as we know, they never joined together in any kind of association, least of all one of a professional nature, with rules about membership and practice.

The Untold Story of Double Entry

Those few who have studied the early history of double entry––namely, Fabio Besta, Tommaso Zerbi, Raymond de Roover, and Federigo Melis––concentrated almost exclusively on banking and commercial accounts and did not pursue the subject once they were satisfied that the technique had reached its full development by the end of the fifteenth century.^{Footnote 26} Since their work, dating to more than half a century ago, historians of early accounting in Italy have ignored the accounts themselves to concentrate exclusively instead on the tradition of manuals deriving from the tract on double entry (1494) by Luca Pacioli, although his “rather simple system” (de Roover) hardly represents the sophistication of the Florentine tradition of accounting practice and, indeed, little of the complexity of the Venetian practice he wrote about, in the light of which some of his methods are downright “crude” (Frederic Lane).^{Footnote 27} The historiography of double entry as manifest in Florentine accounts, however, has loose ends that invite further investigation to carry the story forward in two directions: first, to trace its continuing refinement, and even perfection, as a technique; second, to examine its application to accounts kept for other than commercial and banking activity, the exclusive interest of Melis and de Roover. Both directions, besides opening up new horizons in the traditional history of accounting, lead eventually to questions regarding the cultural context for accounting practice of Florentines and hence to insights into the limitations of early capitalism in general.

The first direction departs from the shortcomings of double entry we have observed in the most sophisticated ledgers of the fifteenth century. At that time, on the one hand, ledgers of businesses almost never have a cash account (although they may have cross-references to cash books, which generally do not survive to be checked) and balances are little more than a recapitulation of all open accounts, usually for purpose of transfer to a new ledger, not a balance showing operating results. On the other hand, the entrepreneur preferred to separate out operating results and record them in what, since the early fourteenth century, was called a secret book (libro segreto), a highly synthetic presentation of partners’ equity and division of profits over a number of years. The difficulty of analyzing the overall activities of an entrepreneur who did not keep a libro segreto is apparent to anyone who has followed the efforts of Melis to analyze the extensive operations of Datini, whose business in Avignon alone is documented by libri segreti.

Even libri segreti leave much to be desired. De Roover held that only one of the three surviving Medici libri segreti represents complete double entry, but even with that, and lacking the accompanying apparatus of other books, including a ledger, his analysis could not go much beyond drawing up a table showing capital and distribution of profits from the individual firms that constituted the Medici “holding” company. Sergio Tognetti could not do even that with the libro segreto of the contemporary Cambini firm; he was able to construct a comparable table only thanks to the survival also of several ledgers (along with several dozen other account books of various kinds for the family businesses). Tognetti was more fortunate in his study of the Serristori silk and commercial businesses at the very end of the century, for he had both a libro segreto and a ledger; although these surviving books do not overlap in time, they reveal the nature of the accounting system. This consisted of three books: libro segreto, ledger, and cash book (none of the latter survives). In the former two, double-entry was not carried through to take in all entries; hence, a balance at any time would have been somewhat tenuous and the profit–loss account in the libro segreto somewhat deceptive. However, the three books were sufficiently tied together through double entry making it possible simply to read off operating results—changes in equity, distribution of profits, breakdown of costs at least in general categories, and sales—all this on an annual basis.^{Footnote 28}

Had Melis and de Roover continued their research into the sixteenth century, they would have discovered that, in fact, the double-entry ledger comes into its own as an autonomous, self-contained synthesis of operations. On one hand, they now have a cash account, which includes cash payments to and from parties that have accounts in the ledger and occasional summary entries, especially for petty expenditures and income, from the cash journal (so the cash account in the ledger can, at times, be in deficit). On the other hand, the ledger appropriates the function of a libro segreto by opening capital and profit–loss accounts; in fact, libri segreti are rarely found anymore. The ledger now will probably have, along with a cash account, separate accounts for partners’ equity and a profit–loss account. Periodic balances are generally not found, but they could have been made at any time, and tick marks on the entries of some ledgers indicate that checking of some kind had taken place. Balances appear at the end of the ledger in the form of an account drawn up to transfer all still-open accounts to a new ledger or to mark the end of a partnership. These are exactly like those de Roover found for the Medici accounts a century earlier: little more than long lists of creditors and debtors.

The second direction in continuing the story of double entry beyond the fifteenth century opens the cast of characters to more than just the merchant-bankers studied by Melis and de Roover, namely to manufacturers and to people who kept personal accounts for entirely private purposes. De Roover explicitly dismissed industrial accounts on the grounds that what he called “the disorderly state of the Florentine monetary system” precluded any progress of double entry accounting in that sector.^{Footnote 29} The accounting manuals, and the historiographical tradition built on them, are also silent on the subject, derived as they are from Pacioli and, hence, from Venetian commercial practice. By the very nature of their activities, however, manufacturers of wool and silk cloth faced accounting problems that went far beyond those of merchant bankers in complexity. In the putting-out system, wool went through about two dozen stages (depending on what one counts), during which it passed through the separate hands of at least a dozen autonomous workshops as well as myriad individuals, such as spinners, warpers, weavers, and finishers, working on their own, all of whom the manufacturers had to bring individually under some kind of accounting control. They did this by opening a number of auxiliary books for specific functions; surviving accounts from as far back as the fourteenth century indicate how complete a record manufacturers were keeping. An impressive set from the mid-fourteenth century is that of the Villani-Stoldi company, producers of wool cloth, of which survive the cash book, record book, income–expenditures book, and separate books for handling raw wool, for workers, for dyers, and for sales (and there are references to books for spinners and for weavers, which do not survive).^{Footnote 30} Nevertheless, anyone who is able to follow Melis’s torturous, if exhaustive, study of the extensive documentation for the Datini wool companies, dating from the very end of the fourteenth century, will appreciate how irrelevant cost analysis was to the keeping of these accounts.^{Footnote 31}

It was not until the sixteenth century that manufacturers refined their accounts by tying together the entire complex of auxiliary books through a system of cross-references from one book to another––what might be called double entry writ large, extending throughout the entire complex of auxiliary books––an important evolutionary aspect of double entry accounting overlooked in the literature. For the firm of Cristofano di Tommaso Brandolini and Partners, renewed through three partnerships from 1580 to 1597, this complex consisted of, all together, twelve account books, all of which survive—the ledger with its accompanying income–expenditure journal, record book and cash book, and a subsidiary ledger for manufacturing operations along with its income–expenditure journal, cash book, and five other books tracking the wool and bolts of cloth through specific stages (washing, dyeing, spinning, weaving, sealing)—and the accounts are kept in such a way that one can isolate (1) the central administration concerned with indirect costs and external operations (purchase of raw materials, dyeing, brokerage, sales, borrowing), and (2) the internal operations related to direct manufacturing costs. The system of cross references in this set of accounts is not flawless, but it is, in fact, possible to trace the entire process, including costs and changing weights, by which at least some single lots of wool became transformed into many bolts of cloth that were then sold to specific buyers.^{Footnote 32}

The same refinement can be found also in the accounting practice within the silk industry. Florence Edler de Roover’s study of the firms of Andrea Banchi, active in the middle years of the fifteenth century, is based on the survival of a libro segreto, ledgers, income–expenditure journals, cash books, record books, a book of manufacturing expenses, a book of shipments and a letter book (not all contemporaneous, however)—taken together, the most complete record of any silk manufactory in the fifteenth century. From this material, Edler de Roover was able to present what has become the classic description of the complete process of production and marketing within this industry for the fifteenth century; but for the lack of double entry in the ledger and cross-references to the auxiliary books, she could not do a cost analysis and construct a balance for operating results. By the end of the century, however, the Serristori silk firm, as we have seen, was keeping its books in such a way as to permit a comprehensive overview of operations, including annual results, albeit not in a single ledger. By the end of the next century, the ledgers of silk firms, like those of wool firms, were completely comprehensive, including now a cash account and the generalized accounts earlier kept separately in the libro segreto. One indication of the sophistication of these later ledgers is the separation of profits and losses from production and sales and profits and losses from financial operations exogenous to the production process, such as, for instance, interest, discounts, and commissions. Moreover, the survival of auxiliary books, such as a cash book, an income–expenditures journal, and a book of manufacturing costs along with its accompanying journals, makes it possible to analyze details of the production process in a way that Edler de Roover could not with the Banchi accounts of a century and a half earlier.^{Footnote 33}

The cast of characters in our story opens up also to Florentines (including some women) outside business circles altogether, whose accounting practice in keeping ledgers of their private domestic and patrimonial affairs reveals the same evolution traced here through business accounts, at least in its general thrust—although, of course, accounting for household administration was hardly as complex as it was for an industrial or commercial operation. We have already observed the universality of accounting practice with respect to formatting and jargon in the fourteenth century; organization, too, underwent many refinements, including linking the ledger to auxiliary books. In the fifteenth century, many Florentines kept a record of personal expenses for both durable goods and consumables, isolating these in separate accounts for food, clothing, and household goods—sometimes simultaneously cross-referencing debit and credit entries, albeit without following through to a complete double entry system. Practice improved over the course of the next century with respect to organization and detail, very much reflecting the rise in consumption characteristic of the period; by the beginning of the seventeenth century, it is not difficult to find household accounts kept in flawless double entry and broken down into numerous categories––a development completely ignored in the historiography and quite extraordinary when regarded in the light of the extensive scholarship recently dedicated to contemporary household accounts in England, in which the basic accounting technique is little more than listing.

Typical is the massive 600-page ledger, complete with its accompanying journal, that Francesco di Giovanni Quaratesi, a merchant banker, kept himself in double entry exclusively for his personal affairs, open from 1622 to 1629; so numerous are the accounts that a detachable, tabbed alphabetical index was needed to direct one to them. These include around fifty separate impersonal accounts—some for sources of income, especially his farms, but the bulk of them for expenses, such as food, clothing for himself, clothing for his brother, household furnishings, silverware, servants, a wedding, the family carriage, the stable, taxes, fuel, construction, and a rural villa; all this complete with a cash account, and capped by a profit loss account.^{Footnote 34}

Far below Quaratesi’s economic status, and just as far away from his business circle, Dino Peri, an intellectual of modest means, kept a ledger from 1633 to 1637 for the administration of the estate and household of the heirs of his deceased father (the aforementioned composer) that is a model of double entry kept with unremitting discipline. Dino kept a wastebook for petty cash expenditures that no longer survives, but totals were transferred periodically to a journal that does survive, in which larger cash transactions, along with transactions in debits and credits, are also recorded. Each of these is then posted to the ledger as both a credit and a debit, with marginal notations indicating the relevant page numbers (and both ledger entries have a reference back to the relevant page in the journal). The ledger has a cash account and accounts for different sources of income (farms, rents, government securities) and for various expenditures (food, oil, wine, firewood, furnishings, miscellaneous, servants’ salaries—these latter with contra entries in separate accounts for each servant). Nothing slips away from accounting control; for example, the debit side of the two food accounts (for different categories of food) includes purchases (with contra entries credited to cash), produce from the family farms consumed by the family (evaluated at market prices, with contra entries credited to the income account of the particular farm, which also includes direct sales in the market), and food purchased individually by any member of the family (with contra entries credited to the account of that person, which is debited for any personal expenses paid out of household funds); the accounts are credited for any of this food subsequently sold or otherwise leaving the household, and the balance transferred annually to the profit–loss account. The accounts for each farm consist of one for income, with two subordinate accounts for income from two different categories of produce, and one for the farmer––all these interlinked through debits and credits. Dino may have learned something about how to do all this in an elementary reading and writing school, but from the age of ten his career followed a path well outside the business world––a Jesuit college, then a law degree, and finally Galileo’s inner circle––and in a letter to Galileo, he expressed his contempt for what he called “the hogwash of mercantile trafficking” (queste porcherie di traffichi mercantili).^{Footnote 35}

Another Florentine, this one solidly ensconced in the titled landed class, who kept household accounts was the Marchese Giovan Vincenzo Salviati. In 1678 he opened a cash book recording income and expenditures to control all the activity of the maestro di casa and spenditore who managed his staff of servants, and he advised drawing up a universal balance every year to know one’s overall economic situation. The marchese had left the merchant-banking activity of his immediate forebears behind but, as a true Florentine, not their accounting mentality.^{Footnote 36} Nor, fortunately for us, did he cast out the memory of those activities in the form of the hundreds of business account books that still survive in one of the city’s most notable family archives.

The Spirit of Capitalism?

What drove this progress? What were the dynamics of evolution? If practice had been institutionalized in a formal educational program or explained in manuals and treatises or fully professionalized, we might have some place to look for a dynamic that drove progress; for the moment, however, this kind of evidence has not come to light. In the end, perhaps, progress was nothing more than an internal dynamic, however slow, toward refinement that is more likely to be found in just about any intellectual (or invisible) technique––such as, for instance (to remain in the time and place of this article), perspective in painting––than in a material technique. The doubling of entries as both debits and credits—Florentines had started doing this in the thirteenth century—puts a compulsive pressure on the accountant once embarked on the adventure to open new accounts in the effort to place contra entries in some kind of orderly fashion, a pressure that is particularly forceful in an economy in which credit plays a major role and even petty transactions are conducted in moneys of account. The result is a plethora of accounts, impersonal as well as personal, that is best brought under control by seeing double entry through to its logical perfection.

We might wonder, instead, why it took so long for the perfecting of a system of which the basic elements—as absurdly simple as they are—had been in place and widely diffused in practice for more than two centuries. Since Werner Sombart, Max Weber, and Joseph Schumpeter, double entry has been regarded as a major sign of the rationalistic pursuit of unlimited profits that is regarded an essential element in the development of modern capitalism. The scene in Florence was certainly as well set for the entrance of the “spirit of capitalism” as any other place in Europe: The marketplace was thoroughly monetized and energized by the wide use of efficient credit instruments and accounting techniques; it was relatively free from regulation, monopoly privileges, and intervention by any external authority; an objective legal system protected property rights and the sanctity of contracts and recognized the validity of private accounts; a lively and sophisticated capital market had emerged with interest rates reasonably stabilized; the industrial, commercial, and banking sectors were organized around entrepreneurs individually seeking profits in international markets; investors’ risks were reduced through flexible business organizations and merchants’ risks through detailed schedules of insurance premiums and rational anticipation of future eventualities; the investment in human capital, represented by the famed artisan sector of the city’s economy, was probably the highest in Europe at the time; and, finally, in the cultural sphere, religious prejudices were largely circumvented by business practice, social prejudices against business never took root, and barriers, formal or informal, against economic and social mobility were never erected. All these features, in short, that economic historians of northern Europe (for the most part unaware of Italian precedents) regard as preconditions for the development of modern capitalism, but not present there much before the seventeenth century, were found in Florence two to three centuries earlier.

However, the “spirit” was lacking; and just how far they were from anything like the “spirit of capitalism” as we understand it today can be measured by considering what these entrepreneurs thought they were doing in perfecting their use of double entry, which is to inquire into their economic culture. No formal statement about the merits and uses of the practice survive that might throw some light on the matter, so we have to fall back on the accounts themselves to understand what these men expected to get from them. Given the refinement of their accounting practice by the second half of the sixteenth century, their books can take us a long way toward that end. The problem is whether they went as far as they could have, which is to ask whether they, in the “spirit of capitalism,” used double entry to know those things that we today expect them to have wanted to know about their operations.

The ledger of a typical late–sixteenth-century firm, as we have seen, imposed a rational order on a mass of data from diverse activities and provided precise information about capital investment, income, expenditures, and hence profits, whereas the use of double entry improved the accuracy of the record, produced a summary view of affairs, and ensured the possibility of striking a balance at any time during operations. However, no ledger seen by this writer through to the early seventeenth century casts this information according to what are considered clear “capitalist” criteria. Balances are no more than what they had always been: a list of outstanding debits and credits drawn up for the purpose of transferring data from a filled-up ledger to a new one. Particularly notable, with respect to what historians have considered as the very core of a calculative mentality, is the lack of any expression of business profits as an annual figure, let alone as a percentage. Partnership contracts continued to fix shares of profits as simple fractions or, more frequently, as so many soldi and denari (and even fractions thereof) of a lira, a practice that sometimes resulted in extraordinarily complex fractions, such as, for example, 3 soldi and 5¹⁷/₂₃denari out of a lira (41¹⁷/₂₃ out of 240, or ⁴/₂₃, or 17.39%).^{Footnote 37} Florentines, however, had been using percentages for interest charges and exchange rates since the fourteenth century, and by the late sixteenth century they had a range of investment possibilities in the capital market—annuities, bank deposits, government securities—explicitly evaluated for their percentage return.^{Footnote 38}

Nor do ledgers easily yield data useful for business analysis—to know, for example, the cash reserve ratio of a bank or sales information about a commercial firm or the breakdown of production costs of a cloth manufacturer. The accounts of the latter are particularly relevant here: In their ledgers, the cost of raw materials appears in a single account with no organization into categories of quality or origins; likewise, sales appear in a single account with no organization into the different categories of products or markets. Labor expenditures, too, appear as summary transfers from auxiliary books with no further information useful for breakdown and cost analysis. Nonetheless, given the technical evolution of double entry accounting as we have described it, with its extension through the entire set of accounts, all the relevant information was available for an analysis congruent with a capitalist operation. Digging into these accounts, we can turn up the kind of information needed for breaking down expenses into their various components and profits into their constituent sources. For example, in the ledger of a cloth manufacturer, entries on the account of sales and on the account of purchases of raw materials include the details about each specific operation—product, quality, quantity, rates, buyer or seller—but these are never isolated. Moreover, following cross-references leading into the auxiliary books and digging even deeper, it would be possible (at least in the sets that have been examined) to put together working biographies of the people to whom work was put out and even to trace the process of production to come up with a breakdown of costs for single pieces of cloth, from the acquisition of the raw material to their sale.

With a good deal of searching and organizing scholars today can do this. Whether entrepreneurs ever did remains unknown, even highly doubtful: If they did, none of the paperwork or results has yet turned up; and if they had wanted to, they presumably would have organized the cross-reference system in a different way to permit easier collection of data. Notwithstanding all the relevant information they had at hand in the firm’s accounts, they do not appear to have attempted to do anything about the extreme fluidity on their employment roster by imposing discipline on the workforce, nor do they appear to have interfered with the traditional structure of wages and prices or to do anything at all to better organize the production process. The fact that at the beginning of the seventeenth century, at the very moment of the collapse of international markets for Florentine woolens, some of the city’s most prominent entrepreneurs were still investing heavily in the industry could be seen as proof of a limited reading––by our standards––of their own accounts.

In short, it appears that double entry did not help industrialists increase the efficiency of production and distribution, thereby improving performance and moving the economy forward, the dynamics that are seen as having set the economies of Holland and England on their way toward modernity. To an extent, it is not difficult to explain this behavior. In comparison with the firms emerging in seventeenth-century Holland and England, Florentine firms were small partnerships organized with low capital formation relative to the partners’ private wealth, and there were no more than several partners, all probably bound together by personal ties of one kind or another. Not having to compete for investment capital on the open, impersonal market, they did not have to cast returns on investment in the comparative, competitive terms of annual yields or percentages. Cloth firms operated on a small enough scale––be it the turnover of merchandise in the hands of a merchant or output of a cloth manufacturer (the largest wool firm turned out no more than two or three bolts a week)––that managers could probably keep a grasp on activities in their head without any fear of cost overruns and hence bankruptcy (which, in fact, was rare in this sector). They appear not to have needed the kind of balance facilitated by double entry that permits ready detailed analysis of costs, profits, losses, assets, and liabilities over any given period.

Ironically, given the perfection of their accounting practice, we scholars can go a long way toward a “capitalistic” analysis of their enterprises—but how far did they get? Or, better, how far did they ever think about going? Not far, apparently. These Florentine entrepreneurs seemed not to have directed their refinement of double entry toward profitability calculation—in other words, toward performance assessment and planning through more rational business and investment decisions to maximize labor input, increase efficiency, and reduce costs, all with an eye on management accountability, planning for the future and the eventual return on investment. If across the fifteenth and sixteenth and into the seventeenth century these men advanced accounting techniques to an impressive level of refinement, they did so without changing anything essential in the way they had always been doing things. Perhaps that course of refinement became an end in itself, something intellectual that actually blocked progress in the material activity that it was designed to record.^{Footnote 39} In any case, as Basil Yamey has argued in numerous articles spanning some seventy years—from 1940 to 2012—double entry, at least in its early but highly sophisticated manifestation, was not inherently an instrument of capitalism as we understand it today.^{Footnote 40}

Apart from accounting technique, these very ledgers, better than any other kind of document, reveal attitudes toward economic affairs that seem foreign to the very nature of modern capitalism. For one, debits and credits were handled in a casual regime, not subject to the rigor and strict discipline of precise temporal limits. Even the city’s major businesses seldom closed their ledgers definitively, there always being accounts with negative balances that could continue open for years, whereas those they considered “bad” were entered usually in a single collective entry (for debitori cattivi) in the balance transferring accounts to a new ledger. As a partner of three companies that had ceased operations, the aforementioned Jacopo Peri kept accounts open in his private ledger for his remaining credits with the companies—eventually, years later, collecting them together in just one account, which, after his death, was continued as an open account in the ledger of his heirs. As Sergio Tognetti observed in his close examination of the open accounts in the ledger of a tannery active in the third quarter of the sixteenth century, no debtor felt he was “rigidly held to pay his debt in the agreed time.” A recent study of a pharmacist shop active in the 1490s found hundreds of accounts in the shop’s books long inactive but still open, not closed out by the shopkeeper, because he had no reason to think that they would not be settled eventually—a characteristic of just about all Florentine accounts books of the period. The marketplace of this early capitalist city was not operating within the moral and cultural strictures of an “economy of obligation” based on credit, honesty, and reputation of the kind Craig Muldrew found emerging in later sixteenth-century (capitalist) England, which makes one wonder about the validity––for all its success in the literature––of Jacques Le Goff’s thesis about the separation of church time and merchant time at the end of the Middle Ages.^{Footnote 41}

Notable, too, is what does not get entered in the accounting record. Florentines, for all their mastery of the technique, did not put accounting to a service that we might take for granted: They did not integrate their accounts of different operations into a system providing them with a macro view of their overall economic situation, whether a complex of business investments or simply a private estate, to provide them with an idea of their total net worth and their annual income. The vast accounting record left behind by Datini did not include a single ledger that would have provided him with an overall view of, or his total income from, his multiple business activities, let alone his patrimonial portfolio. The Medici organized their business enterprises through a single holding company (as de Roover called it); therefore, the company’s libro segreto presents a comprehensive overview of the performance of the various subordinate companies but nothing about the family’s other investments, above all in land. No libro segreto does. These men could, if they had to, draw up a statement of their various investments and landed possessions, as indeed they did for their reports to the tax officials in 1427, not to mention assessment of estates for inheritance purposes. Notwithstanding the growing attention to details and to more rational organization in the enormous accounting record they left behind, extending into the seventeenth century, they did not keep track of changes in their overall wealth––capital, yields, and income in their private portfolios––in any analytical way. Their accounting record reveals no evidence of interest in having this kind of information, even though they had the accounting tool in their hands to obtain it easily enough. In fact, nowhere in this vast record is to be found a single inventory of one’s total net worth of the kind Pacioli lays down as the very first step in the process he sets out to describe. Today, with a good deal of rummaging around in their documents, we can come up with some relevant information about the total net worth and income of some of these men; that job becomes easier as the accounting record improves, but the results of such research are almost always more than just a little problematic. In any event, there is little evidence that these Florentine “capitalists” would consider what results we come up with as much more than a curiosity.

Entrepreneurs were, of course, intent on making profits. Merchants’ correspondence reveals a preoccupation with getting ahead of the others in procuring advantageous market information, and at least some of the largest bankers occasionally vied with one another to win the few contracts that were available from foreign governments. However, no evidence has come to light, either in their correspondence or in their ledgers, to indicate that these “capitalists” were much in competition with one another (although they competed collectively as Florentines against other “national” groups) to the extent that they engaged in cost cutting, underselling, stockpiling, and collusion to cut out a larger share of the market for themselves, all practices that were, in fact, beginning to appear in northern European markets at the end of the sixteenth century (where, we are told, entrepreneurs did not avail themselves of double entry). These men were profit driven, but not to the extent that competition “buffet[ed] all participants” (to cite Joyce Appleby on the “relentless revolution” in seventeenth-century England that initiated modern capitalism).^{Footnote 42} Instead, a strong corporative spirit, albeit unrooted in any institutional structure, bound these men together; in fact, according to currently fashionable network analysis, such bonds serving as access to information and markets may have figured into their calculations about profits as much as monetary returns.^{Footnote 43}

To move outside the accounting record, the economic culture of these men lacked any thoughtful sense of what they were about: they engaged in no debates about their practices, advanced no arguments for the advantages of business over other investment outlets, and felt no need to come up with anything remotely resembling an economic theory. In fact, the numerous contemporary histories and chronicles of this industrial, commercial, and banking city, some of them written by businessmen, reveal no interest whatsoever in economic matters beyond an occasional statistic. Florentines had been using the word “capital” since the thirteenth century as a vague umbrella term for various kinds of income-earning properties, but never in relation to business formation (corpo––body––was their more tangible term), and they certainly did not conceptualize it as something abstract, distinct from individual investments, an essential element––the argument has it––of modern “capitalism.” It is this intellectual dormancy, the utter lack of a conscious ideology, that more than anything else qualifies Florentine capitalism as pre-modern.

In the final analysis, it is only from our perspective that double entry bookkeeping in this period, for all its refinements, appears as a capitalist instrument manqué.

The Culture of Accounting

The cultural significance of these Florentine accounts is not limited to the spirit of business, whatever that was: These documents, like businesses, are “embedded” in the culture of a society––or perhaps it is the other way around. Whichever, the context was larger than the business community, to return to our point of departure. Accounting was a social practice widely diffused throughout the population, much beyond business circles, and often carried out with the same high level of technical skill found in company ledgers. It was an essential element in the education of Florentines, conditioning their way of thinking about economic activity: It served practical functions useful in the conduct of their private affairs, it facilitated the use of credit in their daily activity in the marketplace, and it surely conditioned their behavior there by providing security as a legal record that bore heavily as testimony in any dispute over debt claims before the bar of justice.

Their accounting practice also induced a degree of abstraction in the way Florentines thought about money. Already by the fourteenth century their habit of keeping accounts of their affairs conditioned their economic culture to the extent that they thought in terms of “ghost moneys,” as Carlo Cipolla called moneys of account. They never kept accounts in units of specie: They used instead the lira and its subunits (soldi and denari), which had no exact equivalents in coins, and the florin of account, of which there were usually two or three at any one time, not the gold florin. Indeed, Florentines left hardly any written evidence for the nomenclature of the contemporary coins they handled: Mention of them rarely shows up in book entries, not even in those for the wages of day laborers and payments to peasants, and just as rarely in the popular literature of the period, from Boccaccio onward. Even in their petty transactions in specie, Florentines seemed to have thought about money in terms of moneys of account—that is, as an abstraction. De Roover cites a fifteenth-century French satirist’s amazement at the ability of Italians to deal with money without touching it or even seeing it—all they needed was paper, pen, and ink.^{Footnote 44} Florentines not only got along with just paper, pen, and ink, but they also used these to track the movement of ghosts.

By way of significant contrast with another center of early capitalism, the Venetians—who, at the level of government and international finance, probably had the most complex system of ghost moneys in Europe—kept accounts completely attached to monetary reality at the level of the local market where they conducted their everyday affairs. They, too, used the lire-soldo-denaro system, but these units had exact equivalents in coins—the former two, in fact, identified by the same terms (the denaro was called bagattino). Moreover, they even kept some accounts in their gold coin, the ducat, something the Florentines never did with their gold florin. The mass of Venetians, in other words, probably never encountered ghosts.

Double entry was a ghost of a different kind Florentines chose to deal with—an intellectual, or invisible, technique that has struck historians of various stripes as being animated by something more in this economic culture than just the spirit of business practice. The economic historian Mario Del Treppo sees it as the expression of the forma mentis of a culture with a longing for an ordo mathematicus; and the historian of accounting, Yamey, too, in his reluctance to see the “spirit of capitalism” in the Italian manuals on double entry, resorts to explaining the technique as instead “the product of some mathematical brain.” Likewise the art historian Michael Baxandall, in his attempt to explain what he called “the period eye” of Renaissance Florentines with its “disposition to address visual experience, in or out of pictures … as combinations of regular geometrical bodies and as intervals comprehensive in series,” goes back to their fascination with arithmetic in the trattati d’abaco. It does not take much imagination to extend this taste to include also the order, symmetry, and balance inherent––even visually––in double entry. In fact, the political scientist John Padgett picks up this notion of the “period eye” and draws an explicit analogy with the “systematization and abstraction” of double entry necessitated by “the multiplicity of heterogeneous account books [the Florentine entrepreneur] is forced to manage, keeping track of complex cross-flows of goods, finance, and credit.” All this takes us full circle to the judgment of another economic historian, Ugo Tucci, who, also impressed by the “rationalistic” tendency characteristic of “the spirit of the times,” regarded double entry as nothing less than “the fullest expression of the Renaissance.”^{Footnote 45}

Perhaps this mathematical brain of Florentines expressed itself more concretely in what Burckhardt called their statistical view of things or, better, what Germano Maifreda, studying this period, has recently called the “culture of precise quantification.”^{Footnote 46} Nowhere is such a culture more manifest than in the accounting practice of these Florentines––even intellectuals and aristocrats–– in the fifteenth and sixteenth centuries, driven as they were by an increasing compulsion to make their accounts ever more detailed and more precise, evident in personal household as well as industrial accounts. Maifreda goes on to show how the “quantitative learning about value promoted by the mercantile world”––but, we would add, not only there––led, if not to the “spirit of capitalism,” to a sense of economic knowledge that eventually, later and elsewhere on the wider European stage, gave birth to the science of economics.

For Florentines at the time, however, this culture of precise quantification was more immediately oriented to clarifying an historical record. As concrete records of one’s activity in the marketplace, accounts were historical as well as legal documents. They were consciously generated to be read by someone other than the accountant: hence, the impersonality of personal accounts, including the identification of family members mentioned therein and the use of the impersonal third-person singular and the first-person plural with reference to the accountant himself. For example, the aforementioned composer Jacopo Peri sometimes specifies the relationship of members of his immediate family (“my wife,” “my son”), refers to himself by his full name, and uses both “he” and “we” with reference to himself.^{Footnote 47} This usage in private accounts points to the conscious creation of a historical document, as indeed do the famed ricordi of personal and family facts often appended to them. In this respect, the accounting practice of Florentines is to be seen in the larger context of what has been called their culture of memory.

Burckhardt, in fact, went on to link this taste for quantification to the extraordinary passion of Florentines for history. They produced more histories, chronicles, and books of private ricordi than probably exist for the rest of Italy taken together, and, especially in the hands of Leonardo Bruni, Francesco Guicciardini, and Scipione Ammirati, historical writing was elevated to its first modern from as a distinct literary and scientific genre. What is regarded as the eventual degeneration of the genre into erudite antiquarianism and popular genealogy in the later sixteenth and seventeenth centuries represents instead a culmination of this pursuit by Florentines of ever more quantified factual detail, exactly the course revealed in the history of their business and domestic accounts recounted here.^{Footnote 48} It is hardly surprising that this culture of memory enforced by precise quantification also entered into accounting practice—perhaps, indeed, generated it. Just as their concept of nobility resisted penetration by the growing aristocratic prejudice elsewhere in Europe leading to what Henri Hauser termed the “decapitation” of the commercial class, Florentines long sustained their passion for keeping accounts, improved the technique used in keeping them, and accumulated them in their private archives, where they survive today in far greater number than anywhere else in Europe. In this sense, perhaps, at least something of the spirit of capitalism did indeed drive accounting practice in Renaissance Florence.