Abstract: Balancing Private and Public Interests: Trade Credit and Collective Action in Holland's Early Modern Brewing Industry
The question of the economic impact of guilds has long dominated the study of guilds in early modern Europe. This case study analyzes how brewers and town governments in seventeenth-century Haarlem and Rotterdam established and enforced guild laws to solve collective action problems resulting from asymmetries of information between brewers and their distributors. To keep their breweries operating near capacity and realize the economies of scale in brewing, brewers financed extensive distribution networks. Despite contracts stipulating exclusive dealing with their distributors, clandestine beer delivers by poaching brewers (who also marketed ''Rotterdam'' or ''Haarlem'' style beer) were common. Drawing on archival records, this paper shows how the brewers' guild and town government in Haarlem and Rotterdam established and enforced rules that shifted the risks in poaching and structured competition for distributors between brewers. While the guild regulations upheld a brewer's right to exclusive dealing with a distributor, the regulations also established how brewers could take over an incumbent brewer's distributor. By structuring the right to extend credit and deliver beer to distributors, the guild regulations also limited the race to the bottom in providing credit to distributors, and thus worked to preserve the town's financial capital and the common good.