Hermann von Schullern zu Schrattenhofen: Review of Ferraris’s Principii di scienza bancaria (1892)

Hermann von Schullern zu Schrattenhofen’s German review presents Carlo Francesco Ferraris’s book as an outstanding synthesis of credit theory and banking institutions. After locating Ferraris among the leading figures of Italian economics and recalling his work in administration and statistics, Schullern defines the book’s scope:

Wir haben ein Compendium der Creditlehre vor uns, in dessen Rahmen auch die Institution der Banken eingehende Besprechung findet; auf dem letzteren Gebiete insbesondere ist uns Ferraris kein Fremder, stammt doch auch der Artikel: „Die Banken in Italien“ im Conrad'schen „Handwörterbuch der Staatswissenschaften“ aus seiner Feder.

English translation: We have before us a compendium of the theory of credit, within whose framework the institution of banks likewise receives thorough discussion; in the latter field in particular Ferraris is no stranger to us, since the article "The Banks in Italy" in Conrad's "Handwörterbuch der Staatswissenschaften" is also from his pen.

The review’s central judgment links conceptual precision to explanatory power. Schullern praises definitions that remain close to ordinary linguistic usage, thereby reducing ambiguity and contradiction. His principal example is Ferraris’s rejection of the proposition that credit saves money. As Schullern reports it, expanding exchange absorbs the available money supply; credit enters where money is insufficient. Credit consequently restrains both the rise in money’s value caused by scarcity of circulating media and fluctuations arising from changing demand for them. Yet cash must retain a proportionate relationship to transactions and credit instruments, so the need for money continues to grow. Schullern treats this argument as a substantive contribution to monetary theory:

Dass diese Auffassung von Bedeutung ist, liegt auf der Hand; die Klarheit des Denkens und des Gedankenausdruckes, deren sich der Autor mit Meisterschaft überall beflüssigt, hat hier einen namhaften Erfolg erzielt.

English translation: That this conception is of importance is obvious; the clarity of thought and of the expression of thought, which the author everywhere cultivates with mastery, has here achieved a notable success.

The same insistence on definition informs the discussion of consumption credit: its effects must be assessed only after the category has been properly established. Ferraris allows beneficial uses, particularly consumption-oriented state credit. Schullern then distinguishes credit’s indirect influence on price formation from its effects on the persistence and geographical equalization of particular prices:

Auf die Preise der Waren im allgemeinen übt nach Ferraris der Credit nur einen indirekten Einfluss, indem er nämlich eine Aenderung an den Verhältnissen vornehmen kann, unter denen sich die Preise bilden (S. 52).

English translation: Upon the prices of commodities in general, according to Ferraris, credit exerts only an indirect influence, in that it can bring about a change in the conditions under which prices are formed (p. 52).

These selections constitute Schullern’s account of Part I; he notes, without reconstructing, its discussion of crises and the distinctive position of banknotes. His treatment of Parts II and III is chiefly structural. Part II addresses credit institutions through their nature, operations, legal and prudential safeguards, and relations with the state. Part III classifies credit systems in relation to forms of production, then examines commercial, movable-property, and agricultural credit. The progression from general concepts to institutional organization and specialized lending supports his judgment that the book combines theoretical richness with exemplary exposition. Its bibliography further strengthens its value.

The closing paragraph broadens the review’s purpose from recommendation to scholarly recognition. Schullern draws attention to Arthur Jehan de Johannis, whose work he considers insufficiently known abroad, praising studies of Italian issuing banks and agricultural credit, including their empirical material. This coda places Ferraris’s achievement within a wider Italian debate while making the review itself an act of intellectual mediation. Its distinctive contribution lies in identifying the monetary implications of credit theory and presenting conceptual clarity as the basis for sound judgments about credit’s varied economic effects.