Early Accounting in Northern Italy: The Role of Commercial Development and the Printing Press in the Expansion of Double-Entry from Genoa, Florence and Venice

By Mills, Geofrey T. | The Accounting Historians Journal, June 1994 | Go to article overview

Early Accounting in Northern Italy: The Role of Commercial Development and the Printing Press in the Expansion of Double-Entry from Genoa, Florence and Venice


Mills, Geofrey T., The Accounting Historians Journal


Thus, it was that the double entry system was created in The results of research on the origins and history of accounting techniques appear to have settled the issues of where and when the double entry accounting system was developed. Relatively little has been done to shed light on why this system of accounting practices emerged in Italy in the early thirteenth century or how it spread from there to the rest of Europe. These two issues are explored in this paper and preliminary results are provided to indicate that regional economic development and the technology of moveable type printing were primarily responsible for the rise and spread of double entry.

Historians of accounting agree that one of the two or three great advances in accounting technique was the development and subsequent implementation of the "double-entry" (hereafter DE) system. Furthermore, most accounting historians will agree that the initial successful presentation of DE in published form was Pacioli's 1494 manuscript. So overwhelming is Pacioli's book that he is celebrated as the "father" of modern accounting, and the conventional wisdom is such that accounting as a profession is typically dated from 1494. So great is this legacy that in the 1990s a group of accountants have formed a society to celebrate the 500th Anniversary of Pacioli's book. Named after the master himself, this organization is complete with a newsletter, research notes and trips to Italy. The ironic feature of this celebration is that Pacioli denied any creative originality for the DE system; he was merely memorializing a system which he thought had existed for some two centuries or more in Northern Italy [Taylor, 1956, pp. 179-181].

The literature on the specific origins of DE has gone through cycles over the past century, at first crediting Pacioli and Venice with its discovery. Later research by Fabio Besta and Edward Peragallo has demonstrated that Florence, Genoa and other commercial centers had developed DE either independently of the Venetians, or through a process of intellectual cross fertilization and simultaneous improvement and development. A. C. Littleton, in his seminal book, described the necessary preconditions or the invention o DE, and offers an explanation of the relationship between these actors, which determined the invention of this most useful piece of social technology [Littleton, 1966, pp. 13-211. Academics have also focused their research on other accounting elements, such as the widespread use of the Hindu-Arabic number system, to shed light on the appeal For DE [Williams, 1978, pp. 29-39].

It is not the purpose of this paper to reopen any of the old debates. There is an abundance of research on the alleged locus of invention, and the current state oF research on this issue is inconclusive as to specifics [Yamey, 1949, pp. 99-113; Yamey, 1975, pp. 117-136; Yamey, 1927, pp. 260-292; Sombart, 1933, pp. 116-127; Schumpeter, 1942, pp. 119-126; Lane, 1973, pp. 140-141]. The literature is relatively silent however on a related question, i.e., why did DE emerge where it did and why did its use spread so rapidly? To propose answers to these questions this paper focuses on two phenomena which have heretofore been overlooked in the historiography of DE, namely: (1) the rise of relatively high speed moveable type printing, and the subsequent gradual spread of this print culture from Northern Italy to the commercial centers of Northern Europe and (2) the economic development of the area between the three great Italian city sates -- Genoa, Venice and Florence -- which gave rise to a business climate and level of commercial sophistication that demanded a new and better form of accounting. It is the theses of this paper that the second element mentioned above, the economic development of Northern Italy, created the necessary business environment for the DE technique and that it was then spread to the rest of Europe via business and arithmetic grammars, written in local vernacular, by the new technology of moveable type printing. …

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