Rethinking Debt: The Evolution of Private Credit Markets in Preindustrial France

Abstract

This article focuses on traditional private credit markets in eighteenth-century France through the examination of notarized loan deeds and to a lesser extent civil court records. It examines in particular how credit markets functioned and how they developed in the eighteenth century. It argues that traditional credit markets featured norms of solidarity, cooperation, and fairness, and allowed considerable flexibility and input from both creditors and debtors. But in the middle of the eighteenth century, this market experienced several major changes. Not only did the volume of exchange and the number of notarized credit contracts dramatically increase, engendering a standardization of contracts and a greater resort to external institutions, but a new group of investors modified the traditional norms and practices of exchange. This article concludes that the private credit market shifted from an institution in which input, negotiation, and flexibility prevailed to a more rigid institution in which rules and rigor applied.