Abstract: Credit, Bankruptcy, and Extrajudicial and Judicial Remedies in Eighteenth-Century Northern Europe: Tales of Bankruptcy by Various Means
Recent work on pre-modern commercial networks has questioned whether they lowered risk or increased trust and re-examined the ways in which they achieved closure. The size and scope of networks has come in for some critical inquiry as well. This paper engages particularly with the latter two issues by examining several cases of bankruptcy or near bankruptcy that unfolded in northern Europe during the mid-eighteenth century, with the emphasis on Amsterdam, Emden, Hamburg, Göteborg, and Stockholm, all of which had East Indies ties of various sorts through the large, state-sponsored trading concerns of the day. In the hothouse world of East Indies finance, speculation as well as the access to credit that it presumed and, of course, bankruptcy were commonplaces. But did merchants, through their networks, and judicial and political authorities, through institutions, have a way to cope with these crises? Did any partnership or cooperation exist between these two groups of participants in eighteenth-century credit markets? I conclude that a common set of procedures relying on both network management of information, on the one hand, and the relative similarity of urban legal institutions and procedures on the other, enabled the commercial sector to weather the financial shoals of credit collapse and bankruptcy.