The Low Countries’ export trade in textiles with the Mediterranean basin, 1200-1600: a cost-benefit analysis of comparative advantages in overland and maritime trade routes

This paper challenges the conventional wisdom in European economic history that long-distance maritime transport was always more cost-effective than overland trade routes. Thus the majority of historians in the past century have attributed the rapid decline of the medieval Champagne Fairs, governing the textile trades between the Low Countries, northern France, and Italy, to the establishment of an effective and ‘permanent’ direct sea-route between Italy and north-west Europe from the early 14th century (though the first, a Genoese galley, can be dated to 1277). In my paper, I contend that a spreading stain of chronic, continuous warfare throughout western Europe and the Mediterranean basin from the 1290s, leading into the Hundred Years’ War (1336-1453), with a consequent sharp rise in transport and transaction costs in international trade, was instead the major factor in the decline of the Champagne Fairs, in the concomitant decline of the overland continental trade routes associated with them, and with a forced shift to the maritime trading routes between Italy and north-west Europe. During this war-torn, plague-disrupted period of economic contraction, up to the 1450s, the costs of shipping luxury woollens by the maritime route was certainly cheaper than by overland routes; but the relative cost of the maritime route was still higher than the cost of transporting cheap textiles (says) overland in the late 13th century. Indeed, this steep rise in late-medieval transaction costs in international trade had forced the north-western European textile industries to give up the export of the very cheap, light textiles and focus instead on luxury woollens that could better ‘bear the freight’. Subsequently, however, from the 1450s, with the establishment of alternative, more easterly overland routes in areas free from warfare, principally via the Rhine, then with the restoration of relative peace after the end of the Hundred Years’ War, and with the South German silver-copper mining boom, the overland continental trade ...