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The Untold History of Transparency: Mercantile Agencies, the Law, and the Lawyers (1851–1916)

Published online by Cambridge University Press:  09 May 2014

Marc Flandreau  and
Gabriel Geisler Mesevage
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Abstract

This paper discusses the origins of rating in the second half of the nineteenth century. We review and criticize existing narratives, which—echoing a story told by lawyers favorable to (or employed by) the agencies—have alleged that a cultural shift in normative views, evidenced in an evolution of court decisions, provided legal protection (against libel) to agencies, and permitted the development of printed credit reports. Such a view is inconsistent with evidence from actual judicial decisions and from our exploration of archival material. Looking at both litigated and settled cases, we show that the rise of mercantile agencies in the late nineteenth century was the product of a farsighted corporate strategy applied ruthlessly to a legal system that was still very reluctant to permit the agencies to “commoditize” credit.

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Enterprise & Society , Volume 15 , Issue 2 , June 2014 , pp. 213 - 251
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Copyright © The Author(s) 2014. Published by Cambridge University Press on behalf of the Business History Conference. All rights reserved.

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