Final answer:
The Renaissance was substantially influenced by the developments in banking and the usage of credit. Following the European economic recovery post the 14th century crises, a wealthier populace and a new class of financial professionals rose. This financial stability and growth fostered a conducive environment for the arts and intellectualism that characterized the Renaissance, albeit with an inherent risk of economic volatility.
Step-by-step explanation:
The Renaissance, a period of cultural, artistic, and economic rebirth after the Middle Ages in Europe, was significantly affected by banking and the use of credit. Post the 14th century calamities, Europe's economy began to recover, partly due to the labor shortage caused by the Black Death, which increased wages and resulted in more disposable income for luxury goods. This surplus money facilitated the growth of a new class of bankers, merchants, and artisans.
During the late fifteenth century, capital concentration in the Italian city-states supported the rise in trade and commerce, as well as pioneering credit systems. Joint investment schemes and ventures among merchants became popular, establishing a robust financial support system for the burgeoning enterprise culture of the Renaissance.
The economic prosperity and the creation of money through loans by banks allowed for increased patronage of the arts, fueling the Renaissance cultural movement. Prominent families like the Medici and the Catholic Church played a vital role in supporting artists. Consequently, artists thrived, leading to an explosion in creativity and intellectual pursuit, which defined the Renaissance.
However, the dependency on financial systems comes with risks. Economic downturns can hinder the functioning of banks, limiting the availability of loans and potentially impacting sectors reliant on credits, such as business investment and construction. The Great Recession of 2008-2009 is an example of such a scenario, illustrating the potential volatility of banking systems.