Small is Beautiful: Why Small Hanseatic Firms Survived in the Late Middle Ages

Abstract

Hanseatic firms were, from the outset, small and transitory partnerships, consisting of an active partner ( socius tractans ) and a sleeping partner ( socius dormiens ), who pooled a modest amount of capital—typically 100 or 200 marks—in a 1:1 or 1:2 ratio, dividing the profits equally when the partnership was liquidated a few years later. Hanseatic firms were incapable of performing the tasks which von Stromer thought essential for business success in the late Middle Ages. Their capital stock was utterly inadequate for long-term investment in innovative technology and production facilities.This chapter shows that—contrary to von Stromer's views—the Hanse was not backward, but rather had structures adequate to master severe dislocations. It explains whether these structures were the essential prerequisite for the long duration of the Hanse’s pre-eminence in the North Sea and Baltic trade. Keywords:Hanseatic firms; Hanseatic merchants; Hanseatic trade; late middle ages; von Stromer