The instrument of private trade finance in the early modern global trade beyond Europe. Introduction to the collection of articles

This collection of articles focuses on some instruments that served to finance the expansion of private European trade and enabled the European intermediation of global commerce in the early modern period. Because they were distinct from those featured by the financial modernization of northern European economies -i.e. banks, bills and bonds, they have been conventionally assumed as archaic and lacking the efficiency and productivity gains of the modern vehicles and institutions. However, they coexisted, completed the financial architecture of Europe, and allowed a substantial extra-European commerce whose expansion was at the core of the Smithian growth of the period. Their persistence, scope and geographical reach were central for the expansion and integration of markets in the early modern globalization. Yet, their understanding is confined to micro-case studies of trades that reliant in cash payments and remittances were lagging in the innovations that revolutionized financial markets and long-distance commerce. This view also ignores their relevance even for the very European economy. Whilst the origins preceded the commercial expansion of Europe, research of the European trade finance has mostly focused on institutions of corporate models of trade finance and their institutional spillovers to bonds markets and banking infrastructure that developed exceptionally in some European economies. The alternative instrument common to these contribution was probably more ubiquitous than others more “modern” and persisted despite the flaws associated with its relative “archaism”.