ABSTRACT
Early thinkers were too much occupied with discussing the legitimacy of interest from a moral or religious point of view to think about the causes which make interest high or low; and the cognate or identical problem, what makes the number of years' purchase given for land or an annuity less or more does not seem to have attracted any attention. In the seventeenth century, when the religious and moral objections to usury had worn out, English thought on the causes of high and low interest was stimulated by argument about the expediency of reductions of the legal limit. A strong opinion prevailed among all who had no money to lend that low interest was a good thing. The preamble of the Act of 1623, which reduced the legal maximum from 10 to 8 per cent., alleged that the fall of prices made so high a rate as IO per cent. prejudicial to agriculture and COffi-
25 merce; the Commonwealth Act of 1651 further reducing the maximum to 6 per cent. gives the same reason, and that of 1660, which re-enacted this reduction, says the previous reductions had been " beneficial to the advancement of trade and improvement of lands by good husbandry," and advantageous because they reduced the rate "to a nearer proportion with foreign states with whom we traffic."
