School of Salamanca

The School of Salamanca was a Spanish scholastic movement of theologians and jurists, centered at the University of Salamanca, that produced some of the earliest systematic economic reasoning in the Western tradition. Beginning with the lectures of Francisco de Vitoria in the 1520s, it continued through Domingo de Soto, Martin de Azpilcueta and Luis de Molina. The school argued that the just price of a good arises from its scarcity and the common estimation of buyers and sellers rather than from a seller's cost, labor or risk, an early statement of a subjective, market-based theory of value. It also developed an early quantity theory of money, tracing the price inflation that followed the influx of American silver to the growing money supply, and it relaxed the medieval prohibition on interest by distinguishing legitimate compensation for risk and lost opportunity from usury. Its influence faded as scholastic method gave way to new natural-law and mercantilist writing in the seventeenth century. This description is adapted from Wikipedia contributors under CC BY-SA 4.0; changes were made. https://creativecommons.org/licenses/by-sa/4.0/