An economic explication of Cistercian directives during the Middle Ages

In the Middle Ages, a new monastic order emerged called the Cistercians. This group is historically important because of their economic contributions in both size and longevity. Historians and religious scholars have investigated the general workings of this monastic movement, but little explanation of the economic reasoning behind their activities exists. This paper clears up some of the ambiguity surrounding Cistercian economies. Specifically, how the introduction of a new type of monk, known as the lay brother, provided the Cistercians with a labor monopsony. This monopsonistic model explains the reasoning behind many of the choices made by the Order from land use to industry selection. This model also explains how some of the seemingly paradoxical statements in the existing literature can be reconciled.;Using records of wool contracts from a primary document, the Exchequer Schedules of 1294, this study also tests the Cistercians' involvement in the wool trade relative to other religious orders. This specialization in the wool trade supports the theory of a Cistercians monopsony in the labor market. Latent variable models estimate the likelihood that a Cistercian house will appear in the wool list and that a Cistercian house will produce good quality wool. Additional regressions show the affects of a houses order on the quantity produced, price received and total revenue. Statically significant evidence results for a higher involvement in the wool trade by the Cistercians as well as a significant specialization in good quality wool over other orders. All of these results point to the Cistercians as experts in the wool market.;This study also discusses the production of public goods by large scale "corporations" in the middle ages. This paper focuses specifically on the Cistercians a large scale monastic order. The best evidence of the production of public goods comes from an architectural modular floor plan used by the Cistercians in the building process of over 150 churches. Additional public goods produced by the Cistercians include the rules and regulations set down by the order, the plans of waterworks, horticulture, wine and wool.