The Italian Maritime republics invented many now familiar features of the business world.
It started with tax breaks. Venice and Genoa sat out the feudal era because they didn't have the land needed to produce surpluses -- Venice is in a lagoon, and Genoa is hemmed in by mountains. But they were in the sweet spot for trade. By lending their navies to rulers fending off invaders, they won special privileges to trade without paying tariffs.
Around the end of the 12th century, these conditions created an astonishing boom that fueled their feud. To raise the money to assemble ships, crews, and cargo, traders came up with the idea of selling shares in their operations. To spread the risk they invented marine insurance.
The demand for ships spurred the development, at the Venice Arsenale, of the largest factory complex in Europe before the Industrial Revolution. Builders there mass-produced vessels using standardized parts on an assembly line -- it was said that they could build a galley in a single day. (Dante even gave it a cameo in his Inferno.)
Eventually, to maintain clear records, there arose a sublime invention: double-entry bookkeeping. Goethe may have been into the schnapps when he (reputedly) said that "double-entry bookkeeping is one of the most beautiful discoveries of the human spirit," but you can see what he was driving at. Without the concepts of credito and debito and the balance sheet, modern capitalism wouldn't be possible.
Winner:Venice
