"The Merchant of Venice is a fairy tale. There is no more reality in Shylock's bond and the Lord of Belmont's will than in Jack and the Beanstalk." H. Granville-Barker, in Prefaces to Shakespeare.
This is one way of looking at the play, reading it or enjoying the performance. But it can be a contradiction to our actual feelings about this complex play. The Merchant of Venice' might appear to be a romantic tale without much logic but that would be a superficial interpretation. Portia's father may have raised our concerns in taking away her freedom to choose her beloved; Shylock's bond and those conditions may violate most legal codes; but the way the play moves takes one beyond these doubts and objections.
In The Merchant of Venice' Shakespeare creates an interesting contrast between the mercantile and tumultuous city of Venice and the peaceful and gracious world of Belmont. The striking difference between these two settings helps to capture and maintain our attention. There are differences in the value of systems of the people belonging to the two different cities. The contrast between Venice and Belmont is that one place is where money is made and the other where it is spent. One is characterised by light and sunshine and the other by moonlight and music. Wealth is described in almost sensuous terms like when Salerio says
" touching but my gentle vessel's side Enrobe the roaring waters with my silks."
And in an ironic way later love is talked about in commercial terms. Another contrast is presented when the scenes shift from Venice to Belmont. When we hear of Shylock's hatred and his terms of the bond, our anxiety builds. But then the play moves on to Belmont and the mood shifts from a sort of harshness and tension to a world of romance and graciousness. The most striking contrast is between the court room scene in Act IV and the opening scene of Act V which takes place on a starlit, romantic night in Belmont. Venice could also be a sort of "a disguise" for London. Venice is "poised between Christians" on one hand whose acquisitive practices do not match up with their protestations against usury and Jews on the other whose dealings rest on the "double pillars of expediency and Levitical Law" Shylock's attitude to money is contrasted with that of the Christians. He sees gold as that can be put to work to produce more gold, while they see it as an opportunity to increase the pleasures of friendship and society.
Shakespeare did not leave the fables as he found them. His most immediate source was The Jew of Malta' and through this he seems to explore the relationship between an alien and a settled society. Barabas and Abigail are compliments to Shylock and Jessica. He borrowed heavily from sources and the Bond and Casket theme have a long lineage. Shylock's "merry-bond" has sources both in fantasy and legal fact. In Easter and Western tales we find a contract to give up a portion of the debtor's living flesh. Also in the Twelve Tables, a codification of Roman Civil Law of the 5th century BC, there is a mention that a defaulting debtor's body could be divided among his creditors. The Flesh Bond theme starts with the sardonic kindness' of Shylock's "merry bond" and in Bassanio's protests. And then in the trial scene Shakespeare deals with the intricacies of Law.
There are many legal implications to this play and most people see it in cultural and textual isolation and fail to link it to the prominent social and economic issues. But as Stephen Cohen points out "the trial's battle lines are drawn not between Capitalism (that is Venice) and feudalism (Belmont), but between the socially and politically independent rising class (represented by Shylock, all the Jews) and the ruling class and its ideological allies (the...