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Lorenzo is an example of the Machiavellian villain, typical of many Elizabethan tragedies and dramas. Other good examples of this type of villain include Iago, from Shakespeare's Othello, and Marlowe's Barabas from The Jew of Malta. This character exploited the popular disapproval of the early sixteenth-century Italian political philosopher Niccolo Machiavelli, whose The Prince portrayed a picture of a political ruler who (very broadly speaking) used manipulation over persuasion and fear over love to ensure the loyalty of his subjects. These characters also drew heavily on the traditional Vice figure in English literature.
The Vice figure would use verbal cleverness to lead a protagonist into sin, using that protagonist's inherent moral weakness. Similarly, Lorenzo uses his verbal cleverness to lead the people around him to injustice, playing on their moral weakness as well as their lack of knowledge. And like the Vice figure, Lorenzo has a foil. In the morality plays, the foil was usually a virtuous old man. In this tragedy, the honest and virtuous Horatio acts as a foil. But a key difference between the Machiavellian villain and the Vice figure is that the villain is human, whereas Vice is supernatural (much like Revenge in this play). So Lorenzo is weak in the same way those he manipulates are weak, and he is as easily manipulated as those he manipulates. This ironic fact is proven by Hieronimo when he lures Lorenzo into the playlet, manipulating the young nobleman's love of theater and erroneous belief that Hieronimo bears him no hard feelings.