The fact is, as Boehm-Bawerk has pointed out, that the question of the productivity of capital was never discussed by the mediaeval schoolmen, for the simple reason that it was so obvious.  The justice of receiving an income from an infungible thing which was temporarily lent by its owner, was discussed and supported; but the justice of the owner of such a thing receiving an income from the thing so long as it remained in his own possession was never discussed, because it was universally admitted.[1] It is perfectly correct to say that the problems which have perplexed modern writers as to the justice of receiving an unearned income from one’s property never occurred to the scholastics; such problems can only arise when the institution of private property comes to be questioned; and private property was the keystone of the whole scholastic economic conception.  In other words, the justice of a reward for capital was admitted because it was unquestioned.

[Footnote 1:  Capital and Interest, p. 39.]

The question that caused difficulty was whether money could be considered a form of capital.  At the present day, when the opportunities of industrial investment are wider than they ever were before, the principal use to which money is put is the financing of industrial enterprises; but in the Middle Ages this was not the case, precisely because the opportunities of profitable investment were so few.  This is the reason why the mediaeval writers did not find it necessary to discuss in detail the rights of the owner of money who used it for productive purposes.  But of the justice of a profit being reaped when money was actually so employed there was no doubt at all.  As we have seen, the borrower of a sum of money might reap a profit from its wise employment; there was no question about the justice of taking such a profit; and the only matter in dispute was whether that profit should belong to the borrower or the lender of the money.  This dispute was decided in favour of the borrower on the ground that, according to the true nature of the contract of mutuum, the money was his property.  It was, therefore, never doubted that even money might produce a profit for its owner.  The only difference between infungible goods and money was that, in the case of the former, the use might be transferred apart from the property, whereas, in the case of the latter, it could not be so transferred.

The recognition of the title lucrum cessans as a ground for remuneration clearly implies the recognition of the legitimacy of the owner of money deriving a profit from its use; and the slowness of the scholastics to admit this title was precisely because of the rarity of opportunities for so employing money in the earlier Middle Ages.  The nature of capital was clearly understood; but the possibility of money constituting capital arose only with the extension of commerce and the growth of profitable investments.  Those scholastics who strove to abolish or to limit the recognition of lucrum cessans as a ground for remuneration did not deny the productivity of capital, but simply thought the money had not at that time acquired the characteristics of capital.[1]