Merchants, Markets, and Trade Networks: A Historical Perspective on Accounting

Abstract

Ball (2024) has recently argued that double-entry bookkeeping/accounting ‘emerged around the same time and place as the manorial system began to collapse and transactions in goods and capital markets began to flourish in its stead’.  ‘So, no-one invented double entry accounting: ultimately, markets were responsible for its emergence.’

Here I argue that markets and related institutions of various forms can be seen to have evolved in the varying economic conditions of different civilisations throughout history. They are probably a necessary condition for the emergence of DEB but not a sufficient condition as it is not until 13^th and 14^th century Italy that its burgeoning markets are supported by DEB. In particular the Imperial Chinese experience shows how systems approximating DEB have emerged elsewhere.

Keywords: Double-entry Bookkeeping (DEB), Markets, Imperial Chinese accounting

JEL Classification: F10, G20