Middlemen in English Business 393 



distributing risks.' In the latter sense it was a form of insurance or 

 substitute for it. One form called "insuria marina" had many ad- 

 vantages over direct borrowing for adventures — it saved brokerage, 

 interest, other insurance, renewals, obligation of insuring others, and 

 at the same time insured against the risks of seas and enemies, and the 

 rates however high were not regarded usurious. The East India 

 Company employed "bottomry bonds" because they afforded at the 

 same time insurance and capital, and were attractive to investors by 

 reason of their speculative quality.'' Loans at bottomry were wddeh* 

 used and were procurable even in distant Madras.'^ 



The rise of insurance promoted commerce by lessening the risk to 

 each indixddual and making him more ready to invest in commercial 

 undertakings. A larger fraction of the total available capital was 

 devoted to trade and industry; hoarding cash reserves against con- 

 tingencies was less necessary. Commerce became more calculable 

 and reliable, and business confidence increased. The total number 

 of persons engaged in commerce was enlarged; the man of small 

 means could adventure as underwriter or as lender on bottomry or 

 as merchant of part of a cargo. All its effects in promoting commerce 

 were indirect and not measurable in figures; but they were none the 

 less powerful. For chance it substituted reasonable foresight; for 

 apprehension and sense of hazard it gave confidence. Except in some 

 ephemera] abuses^ it repressed and tended to destroy the gambling 

 spirit in mercantile affairs. Marine insurance was originated under 

 the pressure of need, and its theory was evolved long after its practice 

 was prevalent. Its volume necessarily depended upon the volume of 

 imports and exports and on the size of the merchant marine.^ But 

 through the improvement in its organization it increased faster than 

 the volume of trade. 



Summary and conclusions. In conclusion and summary of the capi- 

 talistic quality and functions of the middleman class, it has been shown 

 that the fundamental justification of the class obtains in the equaliza- 

 tion of supply both in time and place; that to perform this function 

 capital was indispensable; that the middleman buys in times of plenty 



iMolloy, De Jure, 294-7; Postlethwayt, Diet., s. v. Bottomry. 

 2 Scott, II, 172. 

 'Lockyer, Trade, 17. 



* One of these abuses was jobbing in insurance, taking risks to sell to subscribers 

 at higher premiums; another was gambling on vessels in which no interest was 

 owned; another was overvaluation and purposed destruction for the sake of the 

 principal. See 19 Geo. II, Cap. 37; Cary, Discourse, 93-4. 



* See statistics in the Introduction, Chapter 1. 



