The School of Salamanca

Seal of the University of Salamanca

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The University of Salamanca, one of the oldest universities in the world (founded 1218), was a prominent Dominican bastion in the late Scholastic period.  It was one of the homes of  Thomistic theology, even after the doctrines of St. Thomas Aquinas were disintegrating elsewhere in Europe first under the Scotist and Nominalist onslaughts, and then from the Reformation.  

The "School of Salamanca" was initiated by Francisco de Vitoria around 1536 and counted Navarrus and de Soto as its most prominent theoreticians.  The Jesuit trio, Lessius, de Lugo and the remarkable Luis Molina adhered to and further developed the Salamanca position. 

During the inflationary 16th century, theologians were appealed to repeatedly on economic affairs, particularly the status of contracts in those confusing economic times.  In an effort to lay down guidelines for commercial practice and focusing on practical notions of the public good, they moved away from past dogma and approached their questions in the spirit of natural law philosophy.  The result was reversal of centuries of Scholastic thinking on economic matters.  It was the Salamanca school that defined the just price as no more and no less than the naturally exchange-established price.  Their analysis led them to trace a scarcity theory of value and employed supply-and-demand with dexterity. They rejected Duns Scotus's "cost of production" conception of the just price, arguing that there was no objective way of determining price.   

Before Bodin, but after Copernicus, the Salamanca School independently uncovered the essential properties of the Quantity Theory of Money, using it to explain the inflation of the 1500s arising from the influx of precious metals from Spanish America. They also providing a resounding defense of usury.

The accomplishments of the Salamanca theorists have led scholars such as Friedrich von Hayek to note that, contrary to Max Weber's thesis, it is the religion of the Jesuits and not the Calvinists, that set the grounds for capitalism. 

[See also the our pages on the Ancients and Scholastics, the First Economists,  Mercantilism and Social Philosophers.]

The Dominicans

The Jesuits

 Resources on the School of Salamanca

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