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

TY - JOUR

T1 - The Untold History of Transparency

T2 - Mercantile Agencies, the Law, and the Lawyers (1851–1916)

AU - Flandreau, Marc

AU - Mesevage, Gabriel Francis

PY - 2014/9/1

Y1 - 2014/9/1

N2 - 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.

AB - 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.

U2 - 10.1093/es/khu014

DO - 10.1093/es/khu014

M3 - Article

SN - 1467-2227

VL - 15

SP - 213

EP - 251

JO - Enterprise and Society

JF - Enterprise and Society

IS - 2

ER -