Abstract

"Co-Creating Credit Markets from the Shadows: Women's Agency in Milan's Lending System (19th Century)"

Marcella Lorenzini, University of Milan (marcella.lorenzini@unimi.it)

This paper examines how women co-created Italy's "shadow credit market" despite formal exclusion from business, revealing hidden dynamics in financial system evolution. Drawing on 3,765 notarial deeds (1825), 668 probate records (1871), and 1,774 tax records (1872) from Milan, we quantify women's participation in private lending across a century of transformation. Women accounted for 39-42% of total capital, operating under profoundly unequal power, excluded from enterprises yet autonomous in private finance. They participated with comparable lending terms (median 5% interest, 36-month duration), acting as widows, married women, spinsters, and mothers managing children's assets. Their strategies balanced family obligations with market participation: while 73% of loans in 1825 remained within family networks, by 1871, 59% extended to third parties through IOUs. The coexistence of formal banking and informal credit created unintentional co-creation involving banks, notaries, and private lenders. As banks absorbed mortgages, exceeding 111 million lire in Milan (1872), roughly 14% of Italian banking loans, they reconfigured spaces where women exercised financial agency. Notarial documentation made women visible with full personal information, documenting their role in credit allocation, risk assessment, and wealth management. Upper-middle class women (15% nobility) leveraged dowries, inheritances, and assets to provide liquidity to merchants, artisans, and family members, shaping capital flows. This research reveals how non-specialized actors at the margins influenced market structures. By incorporating gender analysis with fiscal and notarial sources, we uncover how modern financial systems emerged through interaction of formal institutions and informal networks, with women as essential yet historically overlooked co-creators of credit markets.