The emergence of double entry bookkeeping

Alan Sangster

Economic History Review, 2025, vol. 78, issue 2, 499-528

Abstract: Double entry account books of medieval Italian merchants and bankers have been extensively used as primary sources by historians of several disciplines interested in business, trade, commodities, markets, sources, prices, interest rates, exchange rates, tariffs, taxes, wages, rents, agents, networks, and many other related topics. The reason for the emergence of such a detailed bookkeeping method is unknown. This paper presents a critical analysis of entries in a ledger of Florentine moneychanger‐bankers from 1211. Comparison with later examples confirms that this ledger portrays a method of bookkeeping embracing double entries that transformed into entity‐wide double entry bookkeeping by the end of the thirteenth century. Following consideration of the socio‐political, economic, legal, and commercial environment of the period and place in which it was used in 1211, the origin of this bookkeeping method is attributed to northern Italian moneychanger‐bankers in the twelfth century. Their bookkeeping method addressed the evidential demands of multiple legal systems relating to use of credit necessitated by a lack of sufficient quality coinage in circulation to support the growing and expanding regional markets of northern Italy.

Date: 2025
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