Abu-Lughod’s fourth chapter details the battle between Genoa and Venice over control of the valuable sea lanes facilitating trade between Europe and the Near and Far East. Despite their impressive advancements in business and navigation technology, both met a rapid decline in the middle and latter stages of the fourteenth stages for a variety of reasons. Before the “Great Depression” of that time, however, Venice and Genoa rose to be naval powers beginning with the first Crusade. Genoa was a more active player, providing support to the European Crusaders and contributing to their initial success. Venice delayed its involvement until the Crusaders made some advance in their conquest. Because of their contributions, Venice and Genoa were rewarded with control over certain land plots and cities, transforming their role in Eastern trade from “passive to active.” Through their direct involvement in the Crusades, the increased demand of eastern goods brought about by European contact with the East, and the strategic position of their ports, Venice and Genoa shifted “the center of gravity” of world trade into their territory. The Italians continued to expand their trading empires, building larger and more powerful fleets, taking over more ports, and negotiating better terms of trade. Eventually, Venice came to dominate trade in the Eastern Mediterranean, the Levant, Egypt, and the Black Sea while Genoa’s hegemonic zone of commerce included North Africa, Northwestern Europe, and the Western Mediterranean. The two sides never stopped battling over control over trade territory, but both vastly grew culturally and commercially, especially in the thirteenth century. Despite their rapid growth, Genoa and Venice found themselves heavily affected by a variety of factors that contributed to the “Great Depression” of the mid-fourteenth century.
So what caused this economic decline in Venice and Genoa? And why was Venice better able to at least somewhat maintain its economy? In regard to the first question, the obvious answer is the Black Plague’s devastating effect on population, and thus manpower. Because of their extensive networks of trade, Venice and Genoa were hit very hard by the Plague, losing as much as 40-60% of their population. Reduced manpower led to a halt in construction of port facilities and a decline in the size of the convoys of trade ships. This decline, however, had begun before the arrival of the Plague, indicating that there were several other underlying factors, which I was most interested in. One factor mentioned was crop failure, which resulted in a decline in municipal financing and the eventual failure of big banks, though Venice and Genoa were well insulated. Political factionalism and its effects are also briefly mentioned, but once again, it is difficult to tie Venice and Genoa to these claims as either the political differences were always present or Genoa and Venice are absent from discussions of similar political failures. As we have discussed in class, some of the factors involved were out of either city’s control. For example, Genoa’s natural and “captured” zones of dominance were not as useful in the second half of the fourteenth centuries, as the Portuguese were better situated on the Atlantic and the overland routes through Central Asia were increasingly fragmented with the decline of the Mongol empire.
For me, the most compelling aspect of the decline involved its economic aspects, as individualistic Genoa was unable to create a safety net from its risks while Venice was able to stay afloat on the back of a more socialist system in which the state provided subsidies in the form of public goods. So was it simply a matter of socialism versus capitalism that allowed Venice to rise over Genoa? Are there applications from this example to our current economic situation? Have we simply taken too many risks that we cannot recover because we have no safety net? It must be mentioned that a large part of Venice’s ability to hang on was the result of a risk, and fortunately for Venice, a successful bet on the southern sea route as opposed to Genoa’s hold in Central Asia. So, perhaps it was just simple luck that sustained Venice while stomping out Genoa in the world trade system. All in all, I believe there are too many factors to be able to say that the discussion should center on the cities’ different entrepreneurial styles. Rather, there are several different factors that contributed to the economic decline, not just in Italy but in all parts of the world system at the time.