ABSTRACT
In the history of ideas, there are only a few questions that have occupied human minds longer than the question of the justification of interest taking. While the theory of any factor price tends to touch upon the normative question of distributive justice, in the case of interest theory it was not just a question of the ‘just price’. The question was if there should be a price at all. Furthermore, the answer to that question became a subject of religious beliefs with respect to both practice and doctrine. Judaism, Christianity, and Islam taught that money-lending for profit was a transgression against the command of God. During the middle ages, religious and secular laws prohibited the charging of interest and identified the practice as ‘usury’.2 In fact, the idea of usury became a ‘central paradigm’ of medieval society (Clavero 1986) and a canon of scholastic economics. It was not until the sixteenth century that ‘usury’ was redefined as high interest rates.
