Table of Contents

Necessary Social Factors for Auctions Since the Classic Era
George Boeck
Dissertation, University of Pennsylvania
Department of Folklore and Folklife,1982

This chapter presents an institutional history. The auction will be traced from its first mention in Babylonia to its present form as a technique for livestock marketing. Although such a history has not been previously undertaken, this sketch will not be comprehensive. Secondary sources provide an outline necessary to establish the character of the cattle auction market. The conditions necessary for the presence of auction markets, a money economy and trade with distant or foreign markets, are part of this character, as are those factors which led to the auction market replacing the livestock commission. While both methods are gesellschaftlich, the auction provides the livestockmen with more direct participation in marketing as well as a community- based opportunity for social interaction. As the folklife scholar might expect, change in large social institutions occurs once people have a practicable course providing greater opportunity for Gemeinschaft.

Markets are necessary precursors of auctions. This brief history establishes the earliest occurrence of auctions, and, more important, differentiates these forms from modern auctions. In Agrarian Sociology of Ancient Civilizations, Max Weber sought to provide a basis for economic discussions of non-capitalistic societies. Herein, he notes that Mesopotamian trade, while highly developed, rested upon government price setting (Babylon under Hammurabi) or market control using royal and temple storehouses (Weber 1976: 103-4). For instance, cattle taken as booty in Assyria under Assurbanipal were sold back to the Assyrians at fixed prices. Under Sargon, grain and sesame from royal storehouses were sold to keep the prices down in times of scarcity.

In a similar, perhaps more successful attempt, Polanyi covers some of the same material from the perspective of the trader (Note 2). He defines Babylonian trade as a marketless economy. Here, the traders act as middlemen working on commission. While the tamkarum (governmental market officers) more or less set prices, they could also auction the traders' goods upon request (Polanyi 1957: 24). As exciting as the presence of auctions in Babylon may be, Polanyi specifidally warns that these auctions and brokerage were devices for arranging exchange in the absence of money. Once markets developed, they became superfluous. As currently practiced, auctions have reappeared "in a sophisticated form and in a new role of assisting the functioning of highly developed markets" (Polanyi 1957:15).

In antique Greece, the military expedition continued to be a significant means of acquiring trade goods. Polayi discusses these expeditions at some length, mentioning that Spartan "booty sellers" accompanied the military to auction captured slaves and cattle (Polyani 1957:85). Terrance K. Hopkins, contributing to the same volume of essays, states that such auctions ranked among the precursors of markets (Hopkins 1957: 268). Two related inventions by the Greeks deserve mention here: the market and coinage. Prior to the sixth century B.C., people bartered for small articles. F. M. Heichelheim discusses the prevalence of barter due to problems of record keeping and transaction size. He points to the cumbersomeness of money or even a wheat standard in any but substantial transactions. Recording transactions, sometimes under penalty of death for failure to do so, generally proved beyond the capacity of smaller traders (Heichelheim 1958: 130-133).

Coinage as a vehicle of participation liberated the common man. Quoting Heichelheim: Small silver money enabled fishers and peasants of Greece for the first time to compete with the larger owners in selling their products on the market (Heichelheim 1958:252). Necessarily, the development of the market was synchronous with that of coinage. The nascent Athenian market moved from near the Acropolis to the Agora in the early sixth century B.C. (Ancient 1971: 1-4). As foreign trade increased, this port location became increasingly active. Heichelheim would conclude that the price variations at the deigma (a samples show room in the Agora) indicate the capitalistic nature of the classic economy (1958:62).

Polanyi would disagree with this conclusion. For the purposes of this study, however, it is enough to say that haggling developed into auctioneering as buyers bid on samples of inexpensive foreign goods displayed in a market (Heichelheim 1958:62) (Note 3). At the outset of the only history of modern auction practices, Wilhelm Stieda mentions that auctions similar to our own did not exist until Roman times. Contradicting Heichelheim, Stieda maintains that auctions in Greece were conducted exclusively by the State rather than by business interests: Die Griechen kannten die Auktion nur bei Gegenstanden, die nicht Eigentum von Privaten, sondern von Korperschaften, namentlich des Staats waren (Stieda 1907: 305).

Whether auctions began in Grecian or Roman markets is not of direct bearing to this discussion. Instead, as both Heichelheim and Stieda indicate, the consideration is of the commencement of modern auction practices upon the involvement of merchants in trade by auction. The Romans do deserve credit for developing the auction to its fullest extent prior to the modern era. As a colonial institution, Mommsen finds a record from Portugal (Mommsen 1877: 100-101); Arnobius mentions one in his native North Africa; Flavius Josephus describes one in Syria (Blaise 1954:103). The latter is a report out of Jewish Antiquities of an elaborate auction on provincial taxation rights (Josephus 1943: v.7, 89-95). Other occasions for auction in Rome include rights to farm a piece of property (Plutarch 1906:6), estate liquidation for indebtedness (Plautus 1949: 63), compensation for property seized by the State (Cicero 1913: 256-9 and Long 1870: 1013); and estate liquidation upon death (Cicero 1927: 108-109).

Mommsen records that Cato the Elder put up for auction his culled cattle (boves vetulos) along with a variety of other lots; cattle and slaves brought higher commissions than the usual one or two per cent (Mommsen 1877: 92, 102). Sufficient record of Roman auction practices remains to enable some description. The standard reference appears to be George Long's essay in the Dictionary of Greek and Roman Antiquities from which this account is taken. A crier (paeco) and/or a public notice would announce the time, place, and conditions of the auction. The crier acted as the auctioneer as well, calling out the bids (liceri,licitari) and entertaining the assembly. Bids were given by word of mouth or commonly understood signals. The property would be knocked down (addici) upon the highest bid. The bid was recorded by an argentarius who could sue for payment if need be, and saw to the conditions of sale. In accordance with battlefield practice, a spear would have been put up as a symbol of the auction, the phrase "sub haste," under the spear, recalling the sale of booty acquired in battle (Long 1870: 172). Except for the called announcement of the sale, the spear symbol, and the legal status of the recorder, this could describe a current auction quite adequately. In fact, current auctioneers frequently mention their next auction early in the day's trading. Further, rather than being under the spear, lots are now said to be under the hammer. Finally, the owner of the auction house frequently acts as recorder and has legal recourse regarding the conditions of sale, albeit as a private citizen rather than an agent for the State.

As one might expect, a dearth of contemporary sources hampers historical research on the period between Rome's fall and the rise of Venice. No mention of auctions can be found between Gregorius Magnus (pope, 590-604) (Blaise 1954: 103) and the late thirteenth century. By this time, the words appears as auxtionarius, meaning "retailer" or auxionatrix, meaning "huckster" (Latham 1965: 37). Changes in trade, as well as those in the function and prevalence of literacy, account for this pause in evidence of auctions. Although Roman fairs had been introduced to Western Europe by 493 (Walford 1968: 7), the organization of fairs and markets did not occur until the late Carolingian f iscal and political improvements (Addison 1953: 26). Further, the scarcity of surplus acted to restrict trade to essentials like iron, millstones, and salt (Baldwin 1937: 67).

Coinage had become debased and rare, returning small trade to barter (Lopez 1971: 18). The sale of manoral livestock was incidental even as late as the thirteenth century, although as D. L. Farmer points out, surplus grain was increasingly important to the functioning of the manor (Farmer 1969: 14). By this time, administrative laxity by the churches and impoverishment by the tolls was causing a sharp decline in the number of fairs as they passed into guild control (Addison 1953: 29, 61). In addition to a minimal state of trade not being conducive to auctions, direct competition between buyers as a means of establishing a price seemed to violate the economic teachings of the medieval church.

Medieval business was conducted upon moral rather than contractual bases. A just price was sought in transactions. Such prices were arrived at by considering the conditions of the market, the cost and risk of transportation, and production costs (O'Brien 1968: 107). Prices at fairs were usually set by an appraisal upon which the tolls were set (Addison 1953: 69). When no just price existed, the buyer and seller sought an equity of burden, neither individual taking advantage of the particular need of the other (O'Brien 1968:109ff). Once the Italian merchants and guildsmen began to prosper again, conditions were conducive to auctions.

In 1235, Florentines issued the solidus, worth twelve denarius (the silver penny minted about 1000). The florin quickly followed. Indicative of increased trade, functional coinage rapidly spread throughout Europe (Schevill 1936:291-292). As mercantile trade advanced, the auction was reintroduced in Italy. Wilhelm Stieda finds the first mention of modern auctions in records from a German emporium in Venice in 1335. In the absence of records of the goods handled, we assume that the Germans availed themselves of the Constantine rarities for which Venitian trade was famous (Stieda 1907:309).

The first records of bankruptcy auctions come from this century as well. Stieda follows Jakob Grimm's work (1854-1960:entry 472), finding an early mention of a Gant, a procedure for the seizure and sale of goods to cover debts, in the. Badener Stadtbuch for 1384. Improvements in livestock production must have been being made by this time since cattle figured heavily in these sales (Stieda 1907: 305).

The word "auction" first appeared in English in William Warner's 1505 translation of Plautus' Menaechmi (Murray 1933: 559, Plautus: 1595). Earlier evidence of the institution in Britain can be found. R. W. Patten traces a candle auction for the farming rights on the Chedzoy church acreage back to the end of the fifteen century (Patten 1971:60-61), Somewhat later, Samuel Kiechel recounts an auction in Dover by a pair of enterprising Britons who sold the wreckage of French ships sunk by the British in 1585 (Kiechel 1866:33).

Continuing in an etymological vein, note might be made of the good Anglo-Saxon word "bid". Toiler traces the word to Aelfric's Grammar (c. 1000) where it meant to ask, pray, or entreat (Toiler 1898 and Somner 1970: under "biddan"). By the 1400's, it could mean offering money for goods or bargaining, as well as the earlier meaning (Kurath 1956: under "beding", and Craigie 1937: under "bid").

The only candidate for the same procedure as an auction under a different name (similar to Gant for Versteigerung in German) would be "roup". This is a Scottish word, perhaps originally from "hrop", meaning crying, clamor, outcry as in Daer bid a wop and hrop (there shall be ever weeping and wailing) (Toiler 1898: 563). The entry in the Scottish National Dictionary has roup synonymous with auction in an example from the Edinburgh Gazette of 1700 (Grant 1969:488). Wright notes that the term especially refers to a displenishment (Wright 1905: 162), although this may indicate more about the types of auctions undertaken than the specific nature of the term "roup."

The Dutch East India Company held the earliest ongoing auctions in Northern Europe related to current business practices. Probably taking the Italian example, the Company held twice yearly sales of their remaining stock of cloves and nutmegs (Stieda 1907:309). It seems likely that these auctions provided the example for the tulip auctions of the 1630's. Once commenced, auctions based on colonial goods spread to Britain where the Hudson Bay Company also marketed furs in a twice annual sale (Stieda 1907: 327).

George McKay finds mention of Dutch book auctions in 1584, 1593, 1596, and 1599. For the latest of these, a catalogue of the library of Philip van Marnix was produced (McKay 1947: 236). Alfred W. Pollard's Introduction to the British Museum's List of Catalogues of English Book Sales gives the source of British book auctions. They were imported from Holland upon the suggestion of Dr. Joseph Hill in about 1653 (McKay 1947: 238). The first British book auction for which we have a catalogue was held on October 31, 1676, when Dr. Lazarus Seaman's collection hit the block. There have been book auctions at least annually since then (McKay 1947: 236-237).

The auction came to America through both the British and Dutch colonists. In 1662, two book auctions were held. Stokes reports that New Amsterdam permitted Anna Claus Croesens to sell by the bailiff some books and property. She held a lien on the latter (Stokes 1915-28: v. 4, p. 219). The earliest book auction in America occurred in Boston on April 18, 1662 (Stokes 1915-28: v. 6, p. 321).

We continue indebted to Stokes for finding record of the social side of early American auctions. He quotes a British minister and lady describing the Dutch colonials: They have Vendues very frequently and make their Earnings very well by them for they treat with good Liquor Liberally, and the Customers Drink as Liberally and Generally pay for't as well, by paying for that which they Bidd up Briskly for, after the sack has gone plentifully about, tho' sometimes good penny worth are got there. (Stokes 1915-28: v. 4, p. 451). We have no record of the goods placed for sale, although mixed lots seem probable since no mention is made to the contrary and the sale seems to be a regular event.

For the bibliophile, we might repeat the well known notice by Samuel Gerrish. He offered the first known catalogue for an American book auction (Littlefield 1900:212). The title page of the copy at the American Antiquarian Society Library reads: A catalog of curious and valuable books, belonging to the Late Reverend...Mr. Ebenezer be sold by auction, at the Crown Coffee-House in Boston, the second day of July, 1717. This auction together with that mentioned by Stokes and that of Ambrose Vincent (1713) support McKay's assertion that book auctions came to America through the British colony, Boston (McKay 1947: 239).

Laws indicative of the history of auctions were passed in 1794, 1813, and 1814. In 1794, a duty of ¼ of 1% was set on auctions of "any interest, right, or estate in lands... any utensiles in husbandry, and farming stock, ships and vessels" with ½ of 1% on all other goods. Land sales by residents moving elsewhere and produce sold on the land where it was raised were excepted from duty. Congress repealed the law laying duties on stills, pleasurable carriages, and auctions in April of 1802. Duties on "goods, wares, and merchandise" sold at auction were reinstated at a 1% rate in July of 1813 and raised to 2% at the end of 1814 (Peters 1845-55: v. 1, p. 397).

These later duties reflect the surge of auctioned foreign goods, largely of British manufacture, immediately following the War of 1812. British manufacturers' agents, anticipating the end of the war, had stockpiled goods in Halifax and Bermuda. Once the war ended, Federal restrictions on imports from England were lifted. In order to copy with the enormous influx of goods and to simplify the paying of customs duties, auction houses were established in Eastern seaports (Jones 1968:33).

In an excellent description of the middlemen in American trade in the first half of the nineteenth century, Fred M. Jones describes the reaction of importers and jobbers to this interruption in their chain of trade (Jones 1968: 34-35). These businessmen, with the support of Niles' National Register (1811-1849), unsuccessfully petitioned Congress for tenfold increases of duties and the abolition of customs credits. Their pamphlet, The Reasons Why the Present System of Auctions Ought to be Abolished (1828), outlines their case. As well as tending toward monopoly, concentrating trade, enhancing prices, and harming both American manufacturers and importers, auctions were said to produce all the pernicious effect of gambling (Jones 1968:36). The auctioneers responded with An Examination of Reasons the Present System of Auctions Ought to Be Abolished (1828).

Ray Westerfield provides factors in the decline of auctions in the 1830's. He states that steam navigation opened the interior ports, thus allowing meetings of commission house representatives and jobbers (Westerfield 1920:208). This corresponds with Jones' finding that importers and jobbers were forced off the Eastern Seaboard to solicit the business of country merchants who might otherwise have attended import auctions (Jones 1968:39). Further, merchants could get eight to ten months' credit in private sales, as opposed to six months from auction sales (Jones 1968:40). This meant that shopkeepers could buy during the midwinter business lull, recover interest costs by passing them on to farmers buying on credit, and have the notes come due after being paid out of harvest profits. The alternative would have been a lengthy purchasing trip to the coast just as the agricultural year was beginning.

Finally, the development of American manufacturing, especially textiles and dry goods, acted to increase the relative cost of British imports (Jones 1968:39, and Westerfield 1920:108). In fact, the share of American products increased at the New York auctions from 7 to 25% between 1820 and 1830 (Jones 1968:33) (Note 4). Broadsides attest to the auction as a popular institution throughout the nineteenth and early twentieth centuries. A glance through the catalogues of prominent library collections indicates the range of locations and goods handled.

From the William L. Clements Library at the University of Michigan, we find descriptions of broadsides from New York State announcing a sale of a great variety of articles (1835) and an estate sale of wood and timber (1842). Similarly, the Glenbow Historical Library in Alberta describes broadsides for a variety of Alberta purebred livestock auctions at the turn of the century. The Bancroft Library has been particularly thorough in cataloging California auction notices and catalogues. These include the jewelry of Lola Montez (1856), houselots and real estate (1850, 1853, 1860), cargo (1849), and elegant and rustic furnishings (1873). These California sales indicate the capacity of the auction method to establish the worth of items in the volatile economy of the gold rush. one anticipates that the earlier prices were considerably higher than the later ones.

Precursors of present day cattle auctions appear in the middle of the nineteenth century. The first public livestock auction in America occurred in Ohio in 1836. This sale by the Ohio Company was also the first sale of purebred cattle in America. Monthly sales of commercial livestock, as well, were begun in Ohio by the Madison County Importing Company. In Kentucky in the 1850's, "court day" sales, resembling European "tax day" sales, were held on the first Monday of each month (Engelman and Pence 1958:3-4, and Howe 1896: v. 2, p. 167) (Note 5).

The normal purpose for auctions during the nineteenth century, however, was more likely to be for the disposal of remainders and unclaimed items. Here, an item in the Tucson Daily Record for May 6, 1880, reveals that the local auctioneer was well enough known to be identifiable by initials: Auctioneer OH held a sale yesterday and disposed of several horses, harness, etc., all of which brought good prices. ("Auctioneer" 1880:3). Richthofen records a practice hearkening back to medieval solutions for found items. Local stock associations 39 received the proceeds of auctioned unattached range calves and unbranded cattle during the era of cowboy roundups (Richthofen 1885:36).

Still, the Ohio and Kentucky precedents certainly establish the connection between agricultural production and auctions. Isolated livestock auctions were also established after the turn of the century. These includes auctions in Iowa (1904), Ohio (1911, established by Mennonites), Nebraska (1912), California (1917) (Note 6), and Minnesota (1919) (Engelman and Pence 1958:3-5). Figures taken from articles by Engelman and Pence (1958:5) and by Abel and Broadbent (1952:Appendix A) readily illustrate that widespread acceptance of decentralized marketing of livestock using the auction method began in the 1930's.

Nationally, the number of livestock auction markets increased from about 200 to about 2,000 during this decade (Figure 1). In the Western region, two phases of growth are recorded. The first, between 1935 and 1940, resulted in an increase from fifty-six to 179 markets. The second, immediately upon the end of World War II, shows an increase of 179 markets in a three year period (Figure 2). Factors facilitating decentralized marketing, referring to Abel and Broadbent (1952:48) and Engelman and Pence (1958:5-6) again, include: 1 ) improved and extended hard surfaced roads and thereby increased trucking potential just as motor carriers were being improved; 2) growing numbers of small packers and improved refrigeration both at the plants and en route; 3) the development of uniform grade and weight classifications (see factors 4 and 8 below); 4) improved collection and dissemination of market news for both buyers and sellers by the federal government; 5) increased transportation and marketing expenses relative to declining livestock prices in 1930-1933; 6) increased local market for immature and unfinished stock due to drought-caused abnormal feed distribution in the West; 7) increasing numbers of odd lots ready for market, especially as fed livestock entered into farm programs; 8) wartime regulations, especially tire and gasoline rationing; 9) local pressure to improve and diversify community markets and services; 10) desire by producers to see livestock sold rather than shipped to private treaty system terminal markets.

Most generally, dwellers in rural neighborhoods availed themselves of technological developments to bring together competing producers and buyers of livestock. The community was identified as the appropriate locus of working social gatherings. So considered, livestockmen asserted the integral relationship between work and social group. Further, this development implies that marketing is an aspect of production. This change from centralized terminal markets located at some distance from the range to smaller auction houses nearer the livestockmen recalls a process first described by Johann Heinrich von Thünen (Thünen 1966: for an abbreviated description of his theory, see Peet 1970-71). He proposed a continuum of the intensity of agriculture varying upon the distance to a sizable market. The nearer to an urban center, the more expensive the land, the more intensive the agriculture, the more productive and smaller the holdings. Feed lots, terminal markets, and truck farms are more likely found around large population centers. Open range grazing, the least intensive form of production, would be found furthest from these urban centers. The ratio of transportation and production costs, which are important to von Thünens thesis, did change dramatically in the 1930's and 1940's.

The development of small, more intensive holdings and thereby the need for a market which could handle smaller lots could readily explain the introduction of livestock auction markets. More importantly, von Thünen's theories would explain the persistence of private treaty marketing in the terminal exchanges in the larger cities, Von ThLinen's demographic theories will play a role in a subsequent geographical discussion as well.


Auctions developed as a means whereby the State could equitably distribute property obtained as the spoils of war, the results of taxation, or legal seizures for debt or legal misconduct. Where relatively free markets exist, merchants may adopt the practice in order to efficiently establish prices, particularly for trade in large numbers of transactions. The conditions prevalent during periods when auctions are present and absent can be readily contrasted. During times of controlled commodity prices, as in the marketless economies before the Agora and the medieval markets governed by a just price, auctions are incidental trade methods. By contrast, during periods of relatively free market prices, as in the Roman Empire and since the Renaissance Italian city states, auctions flourish. Extreme instances of the auction in free price markets occur during trade in popular rarities (exotic spices, books and coins, art) or prize specimens (tulips, registered livestock or pets). Again, the heterogeneity of trade goods prevalent during periods of foreign or long distance trade encourage auctions while the homogeneity of commodities from local trade suppress auctions. The modest medieval markets and the restricted trade during the War of 1812 contrast with Roman, Dutch, and English colonial trade and the contemporary rural American livestock production destined for urban dweller. (A sophisticated economic history is called for to establish the nature of the relationship discerned in this informal summary between heterogeneous trade goods, free market prices, and auctions).

The livestock auctions under study here, however, are something of a special case. They do occur during a period of relatively free market prices and as part of a long distance trade mechanism. In colonial trade relationships, primary and manufactured products were auctioned near the site of consumption. For example, the Hudson Bay Company sold its furs at auction in London. Woolens woven in Liverpool in the 1810's were auctioned in New York City. In livestock marketing, however, price setting competition occurs first at the site of production. This is neither an accident of circumstance nor a necessary condition since livestock had been marketed previously through centralized commission sales at some distance from the farms and ranches. Instead, livestockmen consciously chose a marketing technique which allowed them greater community participation, electing an opportunity for Gemeinschaft within Gesellschaft.