[Footnote 185-1: _Proudhon's_ idea, that this decline might at last bring about a total abolition of interest, is based on the same error as this other: that since a man may keep diminishing his per diem quantum of food, he might finally dispense with food altogether. _Proudhon's_ Banque du Peuple--People's Bank--which, by gradually diminishing the interest on its loans to the minimum cost of its administration, should compel other capitalists to follow its example.]
[Footnote 185-2: Thus, in England, by virtue of 37 Henry III., c. 9, the legal interest was = 10 per cent.; by 21 James I, c. 17 = 8; about 1651 = 6 per cent. (confirmed in 1660); by 12 Anne, ch. 16 = 5 per cent. In the time of George II., where the security was good, only 3 per cent. was, as a rule, paid. In France, the legal rate of interest, at the beginning of the 16th century, was 1/10 of the capital; after 1657, 1/12; 1601 (_Sully_), 1/16; 1634 (_Richelieu_), 1/18; 1665 (_Colbert_), 1/20. Compare _Forbonnais_ Recherches et Considérations, I, 48, 225, 385 ff. It continued at this rate of 5 per cent. with short interruptions until the revolution. (_Warnkönig_, Franz. Staats. und Rechtsgeschichte, II, 588 seq.)
The rates of interest in Russia, in the 16th century, had already declined to 20 per cent. (_Herberstein_, Reise, 41 ff.; _Karamsin_, Russ. Geschichte, VII, 169.) In Holland, in 1623, it was estimated that land purchases paid 3 per cent.; hypothecations, 4 to 6; deposits, 5 to 6; a flourishing business, 10 per cent. Compare _Usselinx_ in _Laspeyres_, Geschichte der volkswirthschaftl. Anschauungen der Niederländer, 76. About 1660, the rate of interest usual in Italy and Holland was at most 3 per cent. (in war times, 4); in France, 7; in Scotland, 10; in Ireland, 12; in Spain, 10 to 12; in Turkey, 20 per cent. (_Sir J. Child_, Discourse on Trade, French translation, 75 ff.) Side by side with 6 per cent. as the rate of interest in England, it was (a little later) 10 in Ireland. _Petty_, Political Anatomy of Ireland, 74.
The same course of things is to be observed in ancient times. In _Solon's_ time, and again in that of _Lysias_, it was 18 per cent. (_Böckh_, Staatshaushalt der Athener, I, 143 ff.) I am of opinion that the rate of interest declined during this long interval, but rose again in consequence of the Peloponnesian war. Among friends, in the time of _Demosthenes_, 10 per cent. (adv. Onetor., I, 386.) _Aristotle_, Rhet., III, 10, mentions 12 per cent., which _Aeschines_, adv. Ctes., 104, and _Demosthenes_, adv. Aph., I, 820, 824, call low. The rate of commercial interest in Egypt (146 before Christ) seems to have been 12 per cent. per annum. (_Letronne_, Recompense promise à celui, etc., 1833, 7.) Contemporaneously in Rome, a similar rate of interest must have been considered usurious. (_Cicero_, ad. Att., I, 12.) Under the emperor _Claudius_, 6 per cent. (_Columella_, De Re rust., III, 3.) _Justinian_ allowed _to personae illustres_ 4 per cent. per annum. (L. 26 Cod., IV, 32.)]