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Parish banking in informal credit markets: the business of private lending in early nineteenth-century Sweden

  • Håkan Lindgren (a1)
Abstract

This study demonstrates the existence of a private, informal and lively credit market in rural Sweden during the 1840s, a period that predates the development of a modern banking system. The market, mainly based on private promissory notes, was concentrated in the hands of a limited number of wealthy farmers who specialized in lending, They facilitated access to credit to well-off farmers, regardless of whether they owned their farms or leased taxed land. By using information from probate inventories, the article analyses the wealth portfolio and characteristics of the lending business of the largest creditors (‘parish bankers’) in a judicial district of southern Sweden in 1841–5. The heart and soul of their business was an intimate knowledge of borrowers’ creditworthiness and mutual trust, as typical of local credit networks. The article also explores the existence of an intergenerational transmission of parish banking business – a dimension of private lending that opens an original path of research on local credit markets in early modern Europe.

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Copyright
This is an Open Access article, distributed under the terms of the Creative Commons Attribution licence (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted re-use, distribution, and reproduction in any medium, provided the original work is properly cited.
Corresponding author
H. Lindgren, Professor Emeritus, Institute for Economic, Business and Financial History Research EHFF ( www.ehff.se ), Stockholm School of Economics, Box 6501, S-113 83 Stockholm, Sweden; email: hakan.lindgren@hhs.se.
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The research program ‘Informal Financial Markets in the Nineteenth Century Sweden’ involves five post-doc researchers and one PhD student at the Institute for Economic and Business History Research (EHFF), Stockholm School of Economics, and is financed mainly by the Swedish Foundation for Humanities and Social Science, the Wallenberg Economic History Foundation, Handelsbankens forskningsstiftelser, the Jacob Wallenberg Foundation and the Gunvor and Josef Anér Foundation. A preliminary version of this article was presented at the Twentieth Congress of the European Business History Association (2016) in Bergen, Norway. I thank the participants, as well as two anonymous referees for helpful comments.

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This list contains references from the content that can be linked to their source. For a full set of references and notes please see the PDF or HTML where available.

E. Dermineur (2015). Trust, norms of cooperation, and the rural credit market in eighteenth-century France. Journal of Interdisciplinary History, 45, pp. 485506.

O. Gelderblom , J. Jonker and J. C. M. Kool (2016). Direct finance in the Dutch Golden Age. Economic History Review, 69(4), pp. 1178–98.

H. Lindgren (2002). The modernization of Swedish credit markets, 1840–1905: evidence from probate records. Journal of Economic History, 62, pp. 810–32.

C. Muldrew (1998). The Economy of Obligation: The Culture of Credit and Social Relations in Early Modern England. London: Macmillan.

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Financial History Review
  • ISSN: 0968-5650
  • EISSN: 1474-0052
  • URL: /core/journals/financial-history-review
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