A detailed study of the commercial credit market provides a fresh vantage point from which to explore commercial culture and society under the old regime and the role of the business community in the political crisis of the French pre-Revolution. Businesses in eighteenth-century France tended to use short-term commercial paper rather than specie as their principal medium of exchange and could not survive without continued access to credit. Focusing on Paris, this dissertation uses both quantitative and qualitative sources to examine the reality and representation of seizure and imprisonment for unpaid debt, bankruptcy and arbitration, interest and exchange rates, and the social ideals of reputation and honor. Recurring financial crises known to contemporaries as "money famines" are explored through the vivid accounts found in private correspondence, and charted chronologically with the aid of original time series of the discount rate and the frequency of bankruptcies.
Lacking an effective lender of last resort and exposed to the constant threat of both individual insolvency and collective financial crisis, French businesses developed the strategies of risk-aversion and mutual aid that would set them off sharply from the more competitive "stockjobbers" of the 1780s. Through private credit, moreover, they were tied inextricably to the market for royal credit. By defaulting on the royal debt the finance ministry could provoke a financial crisis of the private economy, but by panicking the commercial community could also raise interest rates and make it impossible for the state to float new loans. Simply to survive, the state had to maintain the confidence of the financial public, which thereby gained a de facto veto power over the activities of the state itself. A lengthy financial crisis of the commercial economy in 1787-1788 finally undermined the administrations of Calonne and Lomenie de Brienne and helped push the monarchy to the verge of bankruptcy while simultaneously inspiring popular anger against the royal fiscal system.
