Rural Credit Markets and Aggregate Shocks: The Experience of Nuits St. Georges, 1756–1776

Abstract

Using a complete enumeration of credit contracts for a rural area in Burgundy, this article examines how credit markets functioned and what role they served. Credit markets distributed funds to a large fraction of the population, and they were organized to mediate problems of asymmetric information. A central constraint on credit markets, however, was the threat of government intervention. Because of this threat, capital markets remained relatively isolated from one another.