Economics 5th Edition Hubbard

Solutions Manual
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Economics 5th Edition Hubbard Solutions Manual

Contents

Part 1: Introduction
Chapter 1 Economics: Foundations and Models 1
Appendix: Using Graphs and Formulas 11
Chapter 2 Trade-offs, Comparative Advantage, and the Market System 25
Chapter 3 Where Prices Come From: The Interaction of Demand and Supply 43
Chapter 4 Economic Efficiency, Government Price Setting, and Taxes 69
Appendix: Quantitative Demand and Supply Analysis 76

Part 2: Markets in Action: Policy and Applications

Chapter 5 Externalities, Environmental Policy, and Public Goods 97
Chapter 6 Elasticity: The Responsiveness of Demand and Supply 121
Chapter 7 The Economics of Health Care 147

Part 3: Firms in the Domestic and International Economies

Chapter 8 Firms, the Stock Market, and Corporate Governance 165
Appendix: Tools to Analyze Firms’ Financial Information 175
Chapter 9 Comparative Advantage and the Gains from International Trade 189

Part 4: Microeconomic Foundations: Consumers and Firms

Chapter 10 Consumer Choice and Behavioral Economics 209
Appendix: Using Indifference Curves and Budget Lines to Understand
Consumer Behavior 217
Chapter 11 Technology, Production, and Costs 233
Appendix: Using Isoquants and Isocost Lines to Understand Production and Cost 244

©2015 Pearson Education, Inc.

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iv Contents

Part 5: Market Structure and Firm Strategy

Chapter 12 Firms in Perfectly Competitive Markets 267
Chapter 13 Monopolistic Competition: The Competitive Model in a More
Realistic Setting 293
Chapter 14 Oligopoly: Firms in Less Competitive Markets 313
Chapter 15 Monopoly and Antitrust Policy 335
Chapter 16 Pricing Strategy 359

Part 6: Labor Markets, Public Choice, and the Distribution of Income

Chapter 17 The Markets for Labor and Other Factors of Production 373
Chapter 18 Public Choice, Taxes, and the Distribution of Income 401

Part 7: Macroeconomic Foundations and Long-Run Growth

Chapter 19 GDP: Measuring Total Production and Income 421
Chapter 20 Unemployment and Inflation 441
Chapter 21 Economic Growth, the Financial System, and Business Cycles 469
Chapter 22 Long-Run Economic Growth: Sources and Policies 489

Part 8: Short-Run Fluctuations

Chapter 23 Aggregate Expenditure and Output in the Short Run 511
Appendix: The Algebra of Macroeconomic Equilibrium 524
Chapter 24 Aggregate Demand and Aggregate Supply Analysis 537
Appendix: Macroeconomic Schools of Thought 548

Part 9: Monetary and Fiscal Policy

Chapter 25 Money, Banks, and the Federal Reserve System 561
Chapter 26 Monetary Policy 585
Chapter 27 Fiscal Policy 613
Appendix: A Closer Look at the Multiplier 620
Chapter 28 Inflation, Unemployment, and Federal Reserve Policy 645

©2015 Pearson Education, Inc.

 Contents v

Part 10: The International Economy

Chapter 29 Macroeconomics in an Open Economy 667
Chapter 30 The International Financial System 691
Appendix: The Gold Standard and the Bretton Woods System 697

©2015 Pearson Education, Inc.

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prescriptive rights, and even in some measure aspired to assert the lost
independence of Italy. Her efforts in this latter respect, indeed, deserve to be
mentioned, rather for the courage which dictated them, than for their results.
The relative force of the states of Europe had too essentially changed; the
commercial foundations of her own prosperity were too irretrievably ruined to
render it possible that she should rear her head again above other powers of the
second order, or become the protectress and successful champion of the
peninsula. But, in the seventeenth century, the annals of Venice were at least not
stained with disgrace. Even her losses, in a protracted and unequal contest with
the Turks, were redeemed from shame by many brilliant acts of heroism in her
unavailing defence; and the unfortunate issue of one war was balanced by the
happier results of a second. But the firmness of the republic was conspicuous,
and her success unalloyed.
The first of the struggles, in which Venice was called
[1600-1606 . .] upon to engage in this century, was produced, soon after
its opening, by that violent attempt of Pope Paul V, to
which we have before alluded, to revive the monstrous and exploded doctrine of
papal jurisdiction and supremacy over the temporal affairs of the world (1605).
The Venetians had, even in the dark ages, been remarkable for their freedom
from the trammels of superstition, and consistent in repelling the encroachments
of ecclesiastical power. Upon no occasion would the senate either permit the
publication or execution of any papal decree in their territories, until it had
received their previous sanction; or suffer an appeal to the court of Rome from
any of their subjects, except by their own authority, and through the ambassador
of the republic. The jurisdiction of the Council of Ten was as despotic and final
over the Venetian clergy as over all other classes in the state; and while
ecclesiastics were rigidly excluded from all interference in political affairs, and
from the exercise of any civil functions, the right of the secular tribunals to
judge them in every case not purely spiritual was a principle, from which the
government never departed either in theory or practice. Of all the extravagant
privileges claimed by the Romish church for its militia, the exemption of the
ecclesiastical body from taxation (unless as the immediate act of the popes) was
the only one recognised by the Venetian government; and, to annul this,
immunity was a project which had more than once been entertained.
With a spirit similar to that which retained the clergy under due subjection,
universal religious toleration was a steady maxim of the Venetian senate. The
public and peaceable worship of the Mussulman, the Jew, the Greek, the
Armenian, had always been equally permitted in the republican dominions; and
in later times even the Protestant sects had met in the capital and provinces with
a like indulgence. The iniquitous principles of the oligarchical administration
forbid us from attributing to its conduct in these respects any higher or more
enlightened motive than the interested and necessary policy of a commercial
state. But it is a striking proof of the ability and stern vigilance of this
government, that, notwithstanding its universal
toleration and rejection of ecclesiastical control, no
pretence was left for the popes to impugn its zealous
fidelity to the Romish church; and that, at a time
when all Europe was convulsed by the struggle of
religious opinions, Venice alone could receive into
her corrupted bosom the elements of discord,
without shaking the foundations of her established
faith or sustaining the slightest shock to her habitual
tranquillity.
The fierce temper with which Paul V seated
himself on the papal throne, and the systematic
determination of the Venetian senate to submit to no
ecclesiastical usurpations, could not fail to bring the
republic into collision with so rash and violent a
pontiff. Accordingly Paul V had scarcely
commenced his reign, when he conceived offence at
the refusal of the senate to provoke a war with the
Turks, by assisting the Hungarians at his command
with subsidies against the infidels. His
dissatisfaction with the republic was increased by
her obstinacy in levying duty upon all merchandise
entering the papal ports in the Adriatic—a matter in
AV B
which, assuredly, religion was in nowise interested;
and it reached its height when the senate passed a (Many of these were people in
straitened circumstances, who
law, or rather revived an old one, forbidding the wore a mask to disguise their
further alienation of immovable property in favour features.)
of religious foundations; which indeed, even in their
states, were already possessed of overgrown wealth.
At this juncture the Council of Ten, acting upon its established principle of
subjecting priests to secular jurisdiction, caused two ecclesiastics, a canon of
Vicenza, named Sarraceno, and an abbot of Nervesa, to be successively arrested
and thrown into prison, to await their trials for offences with which they were
charged. Their alleged crimes were of the blackest enormity: rape in one case;
assassination, poisonings, and parricide in the other. The pope, as if the rights of
the church had been violently outraged by these arrests, summoned the doge
and senate to deliver over the two priests to the spiritual arm, on pain of
excommunication; and he seized the occasion to demand, under the same
penalty, the repeal of the existing regulations against the increase of the
ecclesiastical edifices and property. But the doge and senate, positively refusing
to retract their measures, treated the papal menaces with contempt; and Paul V
then struck them, their capital, and their whole republic with excommunication
and interdict (1606).
 The Venetian government endured the anathemas, so appalling to the votaries
of superstition, with unshaken firmness. In reply to the papal denunciations of
the divine wrath against the republic, they successfully published repeated and
forcible appeals to the justice of their cause, and to the common-sense of the
world. The general sentiment of Catholic Europe responded to their arguments;
and their own subjects, filled with indignation at the unprovoked sentence
against the state, zealously seconded their spirit. In private the doge had not
hesitated to hold out to the papal nuncio an alarming threat that the
perseverance of his holiness in violent measures would impel the republic to
dissolve her connection altogether with the Roman see; and the open procedure
of the senate was scarcely less bold. On pain of death, all parochial ministers
and monks in the Venetian states were commanded to pay no regard to the
interdict, and to continue to perform the offices of religion as usual. The secular
clergy yielded implicit obedience to the decree; and when the Jesuits,
Capuchins, and other monastic orders endeavoured to qualify their allegiance,
between the pope and the republic, by making a reservation against the
performance of mass, they were immediately deprived of their possessions, and
expelled from the Venetian territories.
The pope, finding his spiritual weapons ineffectual against the constancy of
the Venetians, showed an inclination to have recourse to temporal arms. He
levied troops, and endeavoured to engage Philip III of Spain and other princes
in the support of his authority. At the same time, both the Spanish monarch and
Henry IV of France, the ally of the republic, began to interest themselves in a
quarrel which nearly concerned all Catholic powers, and threatened Europe with
commotion. In reality, both sovereigns aspired to the honour of being the arbiter
of the difference. But the feint of arming to second the pope, by which Philip III
hoped to terrify the republic into submitting to his mediation, had only the
effect of determining the senate to prefer the interposition of his rival; and
Henry IV became the zealous negotiator between the pope and the republic.
Paul IV discovered at length that Spain had no serious
[1606-1615 . .] resolution to support him by arms, and that, without the
application of a force which he could not command, it
was vain to expect submission from so inflexible a body as the Venetian
oligarchy. He was therefore reduced to the most humiliating compromise of his
boasted dignity. Without obtaining a single concession on the point in dispute,
he was obliged to revoke his spiritual sentences. The doge and senate could not
even receive an absolution; they refused to alter their decree against the
alienation of property in favour of the church; and though they consigned the
two imprisoned ecclesiastics to the disposal of Henry IV, they accompanied this
act with a formal declaration, that was intended only as a voluntary mark of
their respect for that monarch their ally, and to be in no degree construed into an
abandonment of their right and practice of subjecting their clergy to secular
jurisdiction. Even their deference for Henry IV could not prevail over their
resentment and suspicion of the banished Jesuits: they peremptorily refused to
reinstate that order in its possessions; and it was not until after the middle of the
century that the Jesuits obtained admission again into the states of the republic.
Thus, with the signal triumph of Venice, terminated a struggle, happily a
bloodless one, which was not less remarkable for the firmness of the republic
than important for its general effects in crushing the pretensions of papal
tyranny. For its issue may assuredly be regarded as having relieved all Roman
Catholic states from future dread of excommunication and interdict—and
therefore from the danger of spiritual engines, impotent in themselves, and
formidable only when unresisted.
With the same unyielding spirit which characterised their resistance to papal
and ecclesiastical usurpation, the Venetian senate resolved to tolerate no
infringement upon the tyrannical pretension of their own republic to the
despotic sovereignty of the Adriatic. Before the contest with Paul V, their state
had already been seriously incommoded by the piracies of the Uscochi. This
community, originally formed of Christian inhabitants of Dalmatia and Croatia,
had been driven, in the sixteenth century, by the perpetual Turkish invasions of
their provinces, to the fastness of Clissa, whence they successfully retaliated
upon their infidel foes by incursions into the Ottoman territories. At length,
overpowered by the Turks, and dispersed from their stronghold, these Uscochi,
or refugees, as their name implies in the Dalmatian tongue, were collected by
Ferdinand, archduke of Austria (afterwards emperor), and established in the
maritime town of Segna to guard that post against the Turks. In their new
station, which, on the land side, was protected from access by mountains and
forests, while numerous inlets and intricate shallows rendered it difficult of
approach from the sea, the Uscochi betook themselves to piracy; and, for above
seventy years, their light and swift barks boldly infested the Adriatic with
impunity. Their first attacks were directed against the infidels; but irritated by
the interference of the Venetians, who, as sovereigns of the Adriatic, found
themselves compelled by the complaints and threats of the Porte to punish their
freebooting enterprises, they began to extend their depredations to the
commerce of the republic.
It was to little purpose that the senate called upon the
[1615-1617 . .] Austrian government to restrain its lawless subjects; their
representations were either eluded altogether, or failed in
obtaining any effectual satisfaction. The Uscochi, a fearless and desperate band,
recruited by outlaws and men of abandoned lives, became more audacious by
the connivance of Austria; and the republic was obliged to maintain a small
squadron constantly at sea to protect her commerce against them. At length,
after having recourse alternately, for above half a century, to fruitless
negotiations with Austria, and insufficient attempts to chastise the pirates, the
republic seriously determined to put an end to their vexatious hostilities and
increasing insolence. The capture of a Venetian galley and the massacre of its
crew in 1615, and an irruption of the Uscochi into Istria, brought affairs to a
crisis. The Austrian government, then directed by the archduke Ferdinand of
Styria, instead of giving satisfaction for these outrages, demanded the free
navigation of the Adriatic for its vessels; and the senate found an appeal to arms
the only mode of preserving its efficient sovereignty over the gulf. The Venetian
troops made reprisals on the Austrian territory; and an open war commenced
between the archduke and the republic.
The contest was soon associated, by the interference of Spain, with the
hostilities then carried on between that monarchy and the duke of Savoy in
northern Italy respecting Montferrat. For protection against the enmity of the
two branches of the house of Austria, Venice united herself with Savoy, and
largely subsidised that state. She even sought more distant allies, and a league,
offensive and defensive, was signed between her and the seven united
provinces. Notwithstanding the difference of religious faith, which, in that age
constituted in itself a principle of political hostility, the two republics found a
bond of union, stronger than this repulsion, in their common reasons for
opposing the Spanish power. They engaged to afford each other a reciprocal
assistance in money, vessels, or men, whenever menaced with attack; and in
fulfilment of this treaty, a strong body of Dutch troops arrived in the Adriatic.
Before the disembarkation of this force, the Venetians had already gained some
advantages in the Austrian provinces on the coasts of that sea; and the archduke
was induced by the appearance of the Dutch, and his projects in Germany, to
open negotiations for a general peace in northern Italy.
The same treaty terminated the wars of the
house of Austria respecting Montferrat and
the Uscochi. Ferdinand of Austria gave
security for the dispersion of the pirates,
whom he had protected; and thus the Venetian
republic was finally delivered from the
vexatious and lawless depredations of those
freebooters, who had so long annoyed her
commerce and harassed her subjects (1617). It
does not appear that the force of this singular
race of pirates, who had thus risen into
historical notice, ever exceeded a thousand
men; but their extraordinary hardihood and L ,
ferocity, their incessant enterprise and activity, P ,S .M ’
their inaccessible position, and the connivance
of Austria, had rendered them formidable
enemies. Their depredations, and the constant expense of petty armaments
against them, were estimated to have cost the Venetians in thirty years a loss of
more than 20,000,000 gold ducats; and no less a question than the security of
the dominion of the republic over the Adriatic was decided by the war against
them.
Although Spain and Venice had not been regularly at
[1617-1618 . .] war, the tyrannical ascendency exercised by the Spanish
court over the affairs of Italy, occasioned the Venetians to
regard that power with particular apprehension and enmity; and the spirit shown
by the senate in the late contest had filled the Spanish government with
implacable hatred towards the republic. By her alliances and her whole
procedure, Venice had declared against the house of Austria, and betrayed her
disposition to curb the alarming and overspreading authority of both its
branches in the peninsula. The haughty ministers of Philip III secretly nourished
projects of vengeance against the state, which had dared to manifest a
systematic hostility to the Spanish dominion; and they are accused, even in
apparent peace, of having regarded the republic as an enemy whom it behoved
them to destroy. At the epoch of the conclusion of the war relative to Montferrat
and the Uscochi, the duke of Osuna was viceroy of Naples, Don Pedro de
Toledo, governor of Milan, and the marquis of Bedmar, ambassador at Venice
from the court of Madrid. To the hostility entertained against the republic by
these three ministers, the two former of whom governed the Italian possessions
of Spain with almost regal independence, has usually been attributed the
formation, with the connivance of the court of Madrid, of one of the most
atrocious and deep-laid conspiracies on record. The real character of this
mysterious transaction must ever remain among the unsolved problems of
history; for even the circumstances which were partially suffered by the Council
of Ten to transpire were so imperfectly explained, and so liable to suspicion
from the habitual iniquity of their policy, as to have given rise to a thousand
various and contradictory versions of the same events. Of these we shall attempt
to collect only such as are scarcely open to doubt.
The Venetians had no reason to hope that the exasperation of the Spanish
government, at the part which they had taken in the late war in Italy, would die
away with the termination of hostilities; and it appeared to the world a
consequence of the enmity of the court of Madrid towards the republic that the
duke of Osuna, the viceroy of Naples, continued his warlike equipments in that
kingdom with undiminished activity, notwithstanding the signature of peace.
The viceroy, indeed, pretended that his naval armaments were designed against
the infidels; and when the court of Madrid recalled the royal Spanish fleet from
the coasts of Italy, the duke of Osuna sent the Neapolitan squadron to sea under
a flag emblazoned with his own family arms. But it was difficult to suppose,
either that a viceroy dared to hoist his personal standard unsanctioned by his
sovereign and would be suffered to engage in a private war against the Ottoman
Empire, or that he would require for that purpose the charts of the Venetian
lagunes, and the flat-bottomed vessels fitted for their navigation, which he
busily collected. The republic accordingly manifested serious alarm, and
sedulously prepared for defence.
Affairs were in this state, when one morning several strangers were found
suspended from the gibbets of the square of St. Mark. The public consternation
increased when, on the following dawn, other bodies were also found hanging
on the same fatal spot—also of strangers. It was at the same time whispered that
numerous arrests had filled the dungeons of the Council of Ten with some
hundreds of criminals; and there was, too, certain proof that many persons had
been privately drowned in the canals of Venice. To these fearful indications that
the state had been alarmed by some extraordinary danger, the terrors of which
were magnified by their obscurity, were shortly added further rumours that
several foreigners serving in the fleet had been poniarded, hanged, or cast into
the sea. The city was then filled with the most alarming reports: that a
conspiracy of long duration had been discovered; that its object was to massacre
the nobility, to destroy the republic, to deliver the whole capital to flames and
pillage; that the Spanish ambassador was the mover of the horrible plot. Venice
was filled with indignation and terror; yet the impenetrable Council of Ten
preserved the most profound silence, neither confirming nor contradicting the
general belief. The life of the marquis of Bedmar was violently threatened by
the populace: he retired from Venice; the senate received a new ambassador
from Spain without any signs of displeasure; and, finally, it was not until five
months after the executions that the government commanded solemn
thanksgiving to be offered up to the Almighty for the preservation of the state
from the dangers which had threatened its existence.
On the extent of these dangers nothing was ever
[1618-1619 . .] certainly known; but amongst the persons executed the
most conspicuous was ascertained to be a French naval
captain of high reputation for ability and courage in his vocation, Jacques
Pierre, who, after a life passed in enterprises of a doubtful or piratical character,
had apparently deserted the service of the viceroy of Naples to embrace that of
the republic. This man, and a brother adventurer, one Langlade, who had been
employed in the arsenal in the construction of petards and other fireworks, were
absent from Venice with the fleet when the other executions took place; and
they were suddenly put to death while on this service. Two other French
captains named Regnault and Bouslart, with numerous foreigners, principally of
the same nation, who had lately been taken into the republican service, were
privately tortured and executed in various ways in the capital; and altogether
260 officers and other military adventurers are stated to have perished by the
hands of the executioner for their alleged share in the conspiracy. The
vengeance or shocking policy of the Council of Ten proceeded yet further; and
so careful was that body to bury every trace of this inexplicable affair in the
deepest oblivion, that Antoine Jaffier, also a French captain, and other
informers, who had revealed the existence of a plot, though at first rewarded,
were all in the sequel either known to have met a violent death, or mysteriously
disappeared altogether. Of the three Spanish ministers, to whom it has been
customary to assign the origin of the conspiracy, the two principal were
distinguished by opposite fates. The marquis of Bedmar, after the termination of
his embassy, found signal political advancement, and finished by obtaining a
cardinal’s hat, by the interest of his court with the holy see. But the duke of
Osuna, after being removed from viceroyalty, was disgraced on suspicion of
having designed to renounce his allegiance, and to place the crown of Naples on
his own head; and he died in prison.
Whether the safety of Venice had really been endangered or not by the
machinations of Spain, the measures of that power were observed by the senate
with a watchful and jealous eye; and, for many years, the policy of the republic
was constantly employed in endeavours to counteract the projects of the house
of Austria. In 1619, the Venetians perceived with violent alarm that the court of
Madrid, under pretence of protecting the Catholics of the Valtelline against their
rulers, the Protestants of the Grison confederation, was labouring to acquire the
possession of that valley, which, by connecting the Milanese states with the
Tyrol, would cement the dominions of the Spanish and German dynasties of the
Austrian family. The establishment of this easy communication was particularly
dangerous for the Venetians, because it would envelop their states, from the
Lisonzo to the Po, with an unbroken chain of hostile posts, and would intercept
all direct intercourse with Savoy and the territories of France. The senate
eagerly therefore negotiated the league between these last two powers and their
republic, which, in 1623, was followed by the Grison war against the house of
Austria. This contest produced little satisfactory fruits for the Venetians; and it
did not terminate before the Grisons, though they recovered their sovereignty
over the Valtelline, had themselves embraced the party of Spain.
The Grison war had not closed, when Venice was
[1619-1645 . .] drawn, by her systematic opposition to the Spanish
power, into a more important quarrel—that of the
Mantuan Succession, in which she of course espoused the cause of the Gonzaga
of Nevers. In this struggle the republic, who sent an army of twenty thousand
men into the field on her Lombard frontiers, experienced nothing but disgrace;
and the senate were but too happy to find their states left, by the Peace of
Cherasco in 1631, precisely in the same situation as before the war; while the
prince whom they had supported remained seated on the throne of Mantua. This
pacification reconciled the republic with the house of Austria, and terminated
her share in the Italian wars of the seventeenth century. Her efforts to promote
the deliverance of the peninsula from the Spanish power can scarcely be said to
have met with success; nor was the rapid decline of that monarchy, which had
already commenced, hastened, perhaps, by her hostility. But she had displayed
remarkable energy in the policy of her counsels; and the recovery of her own
particular independence was at least triumphantly effected. So completely were
her pretensions to the sovereignty of the Adriatic maintained that, when in the
year 1630, just before the conclusion of the Mantuan War, a princess of the
Spanish dynasty wished to pass by sea from Naples to Trieste, to espouse the
son of the emperor, the senator refused to allow the Spanish squadron to escort
her, as an infringement upon their right of excluding every foreign armament
from those waters; but they gallantly offered their own fleet for her service. The
Spanish government at first rejected the offer; but the Venetians, says Giannone,
boldly declared that, if the Spaniards were resolved to prefer a trial of force to
their friendly proposal, the infanta must fight her way to her wedding through
fire and smoke. The haughty court of Madrid was compelled to yield; and the
Venetian admiral, Antonio Pisani, then gave the princess a convoy in splendid
bearing to Trieste with a squadron of light galleys.

Venetian Wars with the Turks

Throughout the remainder of the seventeenth century,

[1645-1657 . .] the affairs of Venice had little connection with those of
the older Italian states; and in tracing the annals of the
republic, our attention is wholly diverted to the Eastern theatre of her struggles
against the Ottoman power. It was a sudden and overwhelming aggression
which first broke the long interval of peace between the Turkish and Venetian
governments. Under pretence of taking vengeance upon the knights of Malta,
for the capture of some Turkish vessels, the Porte fitted out an enormous
expedition; and 348 galleys and other vessels of war, with an immense number
of transports, having on board a land-force of fifty thousand men, issued from
the Dardanelles with the ostensible design of attacking the stronghold of the
order of St. John (1645). But instead of making sail for Malta, the fleet of the
sultan steered for the shores of Candia; and unexpectedly, and without any
provocation, the Turkish army disembarked on that island. The Venetians,
although the senate had conceived some uneasiness on the real destination of
the Ottoman expedition, were little prepared for resistance; but they defended
themselves against this faithless surprise with remarkable courage, and even
with desperation. During a long war of twenty-five years, the most ruinous
which they had ever sustained against the infidels, the Venetian senate and all
classes of their subjects displayed a zealous energy and a fortitude worthy of the
best days of their republic. But the resources of Venice were no longer what
they had been in the early ages of her prosperity; and although the empire of the
sultans had declined from the meridian of its power, the contest was still too
disproportionate between the fanatical and warlike myriads of Turkey and the
limited forces of a maritime state. The Venetians, perhaps, could not withdraw
from the unequal conflict with honour; but the prudent senate might easily
foresee its disastrous result.
 The first important operation of the Turkish army in Candia was the siege of
Canea, one of the principal cities of the island. Before the end of the first
campaign, the assailants had entered that place by capitulation; but so gallant
was the defence that, although the garrison was composed only of two or three
thousand native militia, twenty thousand Turks are said to have fallen before the
walls. Meanwhile, at Venice, all orders had rivalled each other in devotion and
pecuniary sacrifices to preserve the most valuable colony of the state; and
notwithstanding the apathy of Spain, the disorders of France and the empire,
and other causes, which deprived the republic of the efficient support of
Christendom against a common enemy, the senate were able to reinforce the
garrisons of Candia, and to oppose a powerful fleet to the infidels. The naval
force of the republic was still indeed very inferior in numbers to that of the
Moslems; but this inferiority was compensated by the advantages of skill and
disciplined courage; and throughout the war the offensive operations of the
Venetians on the waves strikingly displayed their superiority in maritime
science and conduct. For many successive years, the Venetian squadrons
assumed and triumphantly maintained their station, during the seasons of active
operations, at the mouth of the Dardanelles, and blockaded the straits and the
port of Constantinople. The Mussulmans constantly endeavoured with furious
perseverance to remove the shame of their confinement by an inferior force; but
they were almost always defeated. The naval trophies of Venice were swelled
by many brilliant victories, but by five in particular: in 1649 near Smyrna; in
1651 near Paros; in 1655 at the passage of the Dardanelles; and, in the two
following years, at the same place. In these encounters, the exploits of the
patrician families of Morosini, of Grimani, of Mocenigo emulated the glorious
deeds of their illustrious ancestors; and their successes gave temporary
possession to the republic of some ports in Dalmatia, and of several islands in
the Archipelago.
But, notwithstanding the devotion and courage of the Venetians on their own
element, and their desperate resistance in the fortresses of Candia, the war in
that island was draining the life-blood of the republic, without affording one
rational hope of ultimate success. The vigilance of the Venetian squadrons could
not prevent the Turks from feeding their army in Candia with desultory and
perpetual reinforcements of janissaries and other troops from the neighbouring
shore of the Morea; and whenever tempests, or exhaustion, or the overwhelming
strength of the Ottoman armaments compelled the republican fleet to retire into
port, the numbers of the invading army were swollen by fresh thousands. The
exhaustless stream of the Ottoman population was directed with unceasing flow
towards the scene of contest: the Porte was contented to purchase the
acquisition of Candia by the sacrifice of hecatombs of human victims. To raise
new resources, the Venetian senate were reduced to the humiliating expedient of
offering the dignity of admission into their body and the highest offices of state
to public sale: to obtain the continued means of succouring Candia, they
implored the aid of all the powers of Europe. As the contest became more
desperate, their entreaties met with general attention; and almost every Christian
state afforded them a few reinforcements. But these were never simultaneous or
numerous; and though they arrested the progress of the infidels, they only
protracted the calamitous struggle.
In 1648 the Turkish army had penetrated to the walls
[1648-1669 . .] of Candia, the capital of the island; and for twenty years
they kept that city in a continued state of siege. But it
was only in the year 1666 that the assaults of the infidels attained their
consummation of vigour, by the debarkation of reinforcements which raised
their army to seventy thousand men, and on the arrival of Akhmet Kiupergli, the
famous Ottoman vizir, to assume in person the direction of their irresistible
force. This able commander was opposed by a leader in no respect inferior to
him, Francesco Morosini, captain-general of the Venetians; and thenceforth the
defence of Candia was signalised by prodigies of desperate valour, which
exceed all belief. But we, in these days, are surprised to find that the Turks, in
the direction of their approaches, and the employment of an immense battering
train, showed a far superior skill to that of the Christians. The details of the
siege of Candia belong to the history of the military art; but the general reader
will best imagine the obstinacy of the defence from the fact that, in six months,
the combatants exchanged thirty-two general assaults and seventeen furious
sallies; that above six hundred mines were sprung; and that four thousand
Christians and twenty thousand Mussulmans perished in the ditches and
trenches of the place.
The most numerous and the last reinforcements received by the Venetians
was six thousand French troops, despatched by Louis XIV under the dukes of
Beaufort and Navailles. The characteristic rashness of their nation induced these
commanders, contrary to the advice of Morosini, to hazard an imprudent sortie,
in which they were totally defeated, and the former of these noblemen slain.
After this disaster, no entreaty of Morosini could prevent the duke of Navailles
from abandoning the defence of the city, with a precipitation as great as that
which had provoked the calamity. The French re-embarked; the other auxiliaries
followed their example; and Morosini was left with a handful of Venetians
among a mass of blackened and untenable ruins. Thus deserted, after a glorious
though hopeless resistance which has immortalised his name, Francesco
Morosini ventured on his sole responsibility to conclude a treaty of peace with
the vizir, which the Venetian senate, notwithstanding their jealousy of such
unauthorised acts in their officers, rejoiced to confirm. The whole island of
Candia, except two or three ports, was surrendered to the Turks; the republic
preserved her other possessions in the Levant; and the war was thus terminated
by the event of a siege, in the long course of which the incredible number of
120,000 Turks and 30,000 Christians are declared to have perished (1669).
 Notwithstanding the unfortunate issue of this war, the
[1669-1687 . .] Venetian republic had not come off without honour from
an unequal struggle, which had been signalised by ten
naval victories and by one of the most stubborn and brilliant defences recorded
in history. Although, therefore, a prodigious expenditure of blood and treasure
had utterly drained the resources of the republic, her courage was unsubdued,
and her pride was even augmented by the events of the contest. The successes
of the infidels had inspired less terror than indignant impatience and thirst of
revenge; and the senate watched in secret for the first favourable occasion of
retaliating upon the Mussulmans. After the Venetian strength had been repaired
by fifteen years of uninterrupted repose and prosperous industry, this occasion
of vengeance was found, in the war which the Porte had declared against the
empire in 1682. An offensive league was signed between the emperor, the king
of Poland, the czar of Muscovy, and the Venetians. The principal stipulation of
this alliance was that each party should be guaranteed in the possession of its
future conquests from the infidels; and the republic immediately fitted out a
squadron of twenty-four sail of the line, and about fifty galleys.
There appeared but one man at Venice worthy of the chief command—that
Francesco Morosini, who had so gallantly defended Candia, and whom the
senate and people had rewarded with the most flagrant ingratitude. A strange
and wanton accusation of cowardice was too palpably belied by every event of
his public life to be persisted in, even by the envy which his eminent reputation
had provoked, and by the malignity that commonly waits upon public services,
where they have been unfortunate. But a second and unprovoked charge of
malversation had been followed by imprisonment. Still, however, devoting
himself to his country’s cause, and forgetting his private injuries, Morosini
shamed his enemies by a noble revenge; and, once more at the head of the
Venetian armaments, he led them to a brilliant career of victory. The chief force
of the Ottoman Empire was diverted to the Austrian War; and the vigorous
efforts of the republican armies were feebly or unsuccessfully resisted by the
divided strength of the Mussulmans. In the first naval campaign, the mouth of
the Adriatic was secured by the reduction of the island of Santa Maura, one of
the keys of that sea; and the neighbouring continent of Greece was invaded. In
three years more, Morosini consummated his bold design of wresting the whole
of the Morea from the infidels. In the course of the operations in that peninsula,
the count of Königsmark, a Swedish officer who was entrusted with the
command of the Venetian land-forces under the captain-general, inflicted two
signal defeats in the field upon the Turkish armies. Modon, Argos, and Napoli
di Romania, the capital of the Morea, successfully fell after regular sieges.c
The year 1687 was not so propitious for the Venetians; nevertheless Morosini
rendered himself master of Lepanto and Corinth. The conquest of the Morea
was nearly completed. At this time the senate voted for the great captain a bust
in bronze, bearing the inscription: “Francisco Maurocenico Peloponnesiaco
adhuc viventi Senatus.” This honour redoubled the ardour of Morosini. After
conquering Sparta he turned to Attica, and laying siege to Athens easily took it.
It was in this assault on Athens that a shell struck the Parthenon, of which the
Turks had made a powder magazine, and reduced that celebrated edifice to
ruins. Morosini, who to skill in war and love of country added admiration for
the great and beautiful, did his best to save what he could of this venerated relic,
and exclaimed: “Oh Athens, protector of Art, to what art thou reduced!” Thus
was ancient Greece avenged on ancient barbarism. But different rulers had left
too deep furrows on this sacred soil to enable the republic of Venice, already
enfeebled, to recall it to life; there reigned the silence of a past which could
never be renewed.
In 1688 the Venetian fleet leaving the Gulf of Ægina
[1687-1695 . .] operated against the island of Negropont (Eubœa), but
was unable to take it, not only on account of the
resistance offered by the Turks, but because sickness had begun to decimate the
ranks, and a band of Germans fighting for the republic were withdrawn. The
Venetians were however continually gaining victories in Dalmatia, while the
Turks were frequently discomfited in Hungary; so that the latter began to make
proposals for peace. The demands of the allies, however, were so exorbitant that
the negotiations failed, and the Turks decided to continue the war to the utmost
of their power, a decision which was influenced by the turbulent state of
Europe. Morosini was not discouraged by this new boldness on the part of the
Turks; he had now been raised to the supreme dignity of the dogeship, and
wished by some fresh, great deed to prove that the republic had done wisely in
reposing complete faith in him. He had in his mind the design of attempting
once more the conquest of Negropont; but the forces there being already under
other leaders, he decided to take Monembasia, which would make the conquest
of the Morea quite complete. But the siege had scarcely begun when Morosini
fell ill, and he was obliged to surrender his command to Girolamo Cornaro and
return to Venice. The porte brought forward fresh proposals for peace, but they
were rejected.
The emperor wished to employ all his forces against the French; he was not
disinclined to listen to suggestions for an agreement. Knowing this, the
Venetians understood how much it was to their interest to conduct carefully the
enterprise which they had in hand, so that if peace should be concluded it might
be to their advantage. So Cornaro assailed Monembasia with great ardour until
he finally mastered it, after which he attacked the Ottoman fleet and defeated it
at Mytilene. After the taking of Vallona, which was dismantled, an illness ended
Cornaro’s honoured life. Domenico Mocenigo who succeeded him in his
command was very different from his predecessor. An attempt made by him to
conquer Candia failed through his cowardice; he was punished by the senate,
who deprived him of his command and begged Morosini to place himself once
more at the head of the army. Morosini, though well on in years, started at once
from Monembasia the 24th of May, 1693. On this occasion, however, he did
nothing very remarkable beyond acquiring possession of some islands—among
others Salamis; partly because the season was unfavourable, and the Turks were
strongly fortified in the Hellenic territory which still remained to them. He died
not long after (January 9th, 1694), and was succeeded in his command by
Antonio Zeno.
The new commander, while the troops were gaining fresh victories in
Dalmatia, took Scio; but he afterwards allowed a favourable opportunity of
defeating the Turkish fleet to escape him, and did not even trouble to keep Scio
which he had conquered. He was called upon to give an account of his conduct,
and thrown into prison where he died before sentence had been pronounced
against him. His successor, Alessandro Molin, was more fortunate. It seemed as
though the star of Venice was once more declining, and the enemy’s forces
again became threatening. The Turks, recovering from the defeats they had
sustained, again attempted the reconquest of the Morea. But not only were they
unsuccessful in this, but Molin determined to meet them off Scio and there
gained over them a signal victory. Equally auspicious for Venice were the years
1696, 1697, 1698, in which last, on September 20th, the purveyor extraordinary,
Girolan Dolfin, gained another naval victory by which supremacy of the sea
was secured to the republic and the dominion of the Archipelago guaranteed.
But already the other great victory of Zenta, within the military boundaries, was
gained by Prince Eugene of Savoy on September 11th; and as the Turks lost
their grand vizir, seventeen pashas, thirty thousand soldiers dead and three
thousand prisoners, the sultan was convinced that the only thing which
remained for him to do was to sue once more for peace, the more so as Cornale,
who succeeded Molin as commander, had in various encounters defeated the
Ottoman army and, closing the passage of the Dardanelles, had several times
reduced Constantinople to starvation. The Christian powers were not this time
deaf to the request of the sultan. They perceived the necessity of making peace
with the East, since the hopes and fears growing out of the war of the Spanish
Succession had given rise to contentions of all kinds among the three cabinets.
 Through the mediation of England and Holland
[1695-1699 . .] —after the overcoming of many difficulties
brought forward principally by the Venetians, who
feared that they might lose in peace what they had gained in war, or that
they would not receive from the empire, a rival power, all due regard for
their interests—on the 13th of November, 1693, the imperial
plenipotentiaries, with those of Poland, Russia, Venice, and the Turks,
assembled in congress at Karlowitz, a town on the Danube to the south
of Peterwardein.d
By the Treaty of Karlowitz, which the republic, in concert with the
empire, concluded with the Ottoman Porte, Venice retained all her
conquests in the Morea (including Corinth and its isthmus), the islands of
Algina and Santa Maura, and some Dalmatian fortresses which she had
captured; and she restored Athens and her remaining acquisitions on the
Grecian continent (1699).c
 CHAPTER XVII. ITALY IN THE
EIGHTEENTH CENTURY
Italy’s condition when she left the death-
[1701-1800 . .] stricken hands of the dynasty of Charles V made a
lively impression on her new sovereigns. It
showed what could be done towards the unhappiness of a country by
foreign rule—a rule which only thought from day to day of gathering
fruits of conquest, without even trying to assure those of the morrow.
For a century and a half the governors of Milan and Naples, and
following their example the independent sovereigns, egoists, or
oppressors, with rare exceptions, had allowed ancient evils to subsist or
replaced them by new ones. They had only sought to exploit to their own
profit the privileges, the old institutions of the Middle Ages, instead of
reforming or ameliorating them. Nobles and clergy in particular had been
left in possession of their old rights over the chase, fishing, mills,
furnaces, justice even, and were the real instruments of domination.
Thence arose the strangest position of affairs.
Legislations, ancient and contradictory customs which in the south
went back to the Normans, the Hohenstaufens, and the Angevins, or in
the north at Bologna, Florence, Pisa, Siena, survived in institutions of
lost republics, formed an inextricable chaos where the arbitrator reaped a
rich harvest. Privileges and jurisdictions, both feudal and clerical,
confused or perverted the systems of judicial and political
administration; taxation varied in every country and for every person;
power made itself oppressively but universally felt. The general tax-
collectors, to whom finance was given over, and venal officials, who
represented authority, still further augmented disorder. Lastly the power
of the holy see, taking a more active part in political institutions in Italy
than anywhere else, came as a final burden.
In the country the rights of primogeniture, mortgage, trusteeship, and
free pasturage condemned the land to sterility. In towns the old
corporations, statutes, and recent monopolies killed all commerce and
industry. There were hardly any natural products in this the most fertile
country of Europe, still less of manufactured products in towns which
formerly had filled the markets of Europe with their exports, and the bad
condition of the roads overburdened with turnpikes did not allow of
transit over a peninsula so admirably situated and which in the Middle
Ages had served as a link between Europe and the Levant. Moreover the
deserted state of Apulia recalled the times of the decadence of the
Roman Empire. In the kingdom of Naples the royal pasturage had an
extent of fifty miles in length and fifteen miles in breadth. In Tuscany
and the papal states the Maremma reached as far as the Mediterranean
coasts. The greater part of the towns in central and southern Italy were
depopulated, their palaces deserted, the houses fallen into ruins and
never repaired. Even literature and art, which had maintained themselves
up to that time, had now shared the common fate.h
Politically the eighteenth century, like the
[1701-1725 . .] sixteenth, began in Italy with fifty years of
warfare; but the sufferings of the country,
although often heavy, were always much lighter than those which had
prevailed during the great struggle between France and the house of
Charles V.
There broke out successively four European wars, into all of which the
Italians were dragged by their foreign masters.f The first of these was the
war of the Spanish Succession; the second, the war of the Quadruple
Alliance; the third, the war of the Polish Succession; the fourth, the war
of the Austrian Succession. A brief review of the effect upon Italy of
these wars will form the chief topic of the present chapter. But before
taking up the sweep of these political events, it may be of interest to
glance at the internal conditions of the most interesting of Italian states,
Tuscany, and witness the passing of its famous family of Medici, which
now becomes extinct after three centuries of domination. Cosmo III, who
occupied the ducal throne at the close of the century, continued to reign
until 1723.a
Although neither public nor private conditions were very satisfactory
under his government, the brilliancy of the court gave no indication that
times were bad. There never was a time of greater luxury, nor had so
many rich gifts ever found their way into foreign lands before. Cosmo
had an abnormal craving for notoriety. He wished to pass for the most
magnificent of sovereigns, while his ever-increasing leaning towards
piety gave rise to the most singular contrasts between his private and his
court life—contrasts which were intensified by the habits and
surroundings of his sons and for a time of his own brother also. The
latter, Francesco Maria, when cardinal, knew no moderation in his
expenditure, and the learned French Benedictines who saw him in Rome,
in 1687, report that the grand duke was forced on account of his
extravagance to recall him to Siena, and then describe how refreshments
alone cost him daily twenty-five louis d’or. Besides monks of all orders,
who were always to be found in the palace (the prince had founded near
the Ambrogiana an Alcantarian[21] monastery which was maintained at
his expense), individuals of all nations presented themselves at court.
The ambassadors took the greatest pains to gratify Cosmo’s wishes: Czar
Peter sent him four Calmucks, and from the Danish king, Frederick IV,
he received Greenlanders. The residences were filled with treasures and
curiosities of all kinds, and the princely vineyards and gardens were of
the choicest. At the end of the winter of 1719, King Frederick IV of
Denmark spent nearly six weeks in Florence, which he had already
visited as crown prince in 1692 under the incognito of the count of
Schaumburg. The great trouble which the ceremonial gave, in spite of the
incognito on that occasion, is described by the prince’s attendant, Hans
Heinrich von Ahlefeld, in his account of the journey. An inscription on
the archway of the Porta San Gallo commemorates the visit of the
Scandinavian monarch, whose predecessor, Christian I, had passed
through that very gate 235 years before. Cosmo celebrated the visit of his
exalted guest, in spite of the Lenten season, by balls and music. A large
print which represents the evening progress of the princess Violante
Beatrice at the time of the investment of Siena on April 12th, 1717, gives
some idea of the brilliancy and ceremonial as well as of the costumes
and uniforms in customary use on official occasions: the princess drove
through the gaily decorated town in her state carriage, almost entirely
made of crystal and drawn by six horses, surrounded by pages and
halberdiers bearing torches, and followed by the magnificent carriages of
the nobility on to the Piazza del Campo, whose every tower and roof was
brilliantly illuminated and which was filled to overflowing by a surging
crowd. The privations and losses of later years so depressed Cosmo,
however, that he could think of nothing but his religious exercises, and
the distinguished flower of Florentine youth went into foreign lands to
seek compensation for the restrictions imposed upon them at home.
When in 1720 the electoral princess of the Palatinate, who was by no
means a pleasure-seeker, felt it incumbent upon her to break through this
severe régime by encouraging the carnival festivities, the whole nation
showed unmistakably how hateful this morose existence had been to
them.b
Cosmo III died at an advanced age on October 31st, 1723, leaving as
his successor his son Giovan Gastone. The country at this time was
plunged in debt, industries had decayed, prosperity was destroyed. The
new archduke drove away the monks and priestly flatterers that had
surrounded his father, suppressed several pensions that had been
awarded, converted heretics, Turks, and Jews—lightened, in a word,
many of the burdens that oppressed the land without displaying the
energy necessary to remove the worst evils from which it suffered. He
held at a distance his German wife, who had lately entered with alacrity
upon the duties of her position as reigning archduchess in Florence. In
matters pertaining to exterior politics he followed closely in the footsteps
of his father. Entertaining little hope of setting aside the decisions of the
Quadruple Alliance, he took good care to fix the allodial estates of the
house of Medici and to indicate which portions could be looked upon as
territorial and which must be ceded to the electress of the Palatinate as
compensation for the future transfer of the feudal tenure to another
family of the Medici female line.
A new turn was given to Tuscan affairs in 1725, while the belief still
prevailed that the infante Charles would shortly arrive from Spain with
an armed force with the intention of so establishing himself in Tuscany
that his position and that of his successors could not be shaken either by
the negotiations at Cambray or the pretensions of the emperor. Instead of
this solution the Madrid court secretly despatched to Vienna Baron de
Ripperda, an able Belgian who had recently gone over to the Catholic
church. This envoy succeeded in effecting a separate contract between
the emperor and Philip V whereby Tuscany and Parma were to be held as
possessions of the infante Charles and his successors without the
establishment there of foreign garrisons, exactly in accordance with the
provisions of the Quadruple Alliance. Although this agreement (which
brought to a close the congress of Cambray) dispelled the fears of the
archduke as to an irruption of the Spaniards into his domains before his
death, and made possible an undisturbed continuance of his dissolute
mode of life, fresh mistrust arose between the courts of Vienna and
Madrid which created renewed tension in the affairs of the Italian states.c
Giovan Gastone loved conviviality, and during
[1725-1743 . .] the first years of his reign he took part in the