Litigation and the Social Order: Debt and Downward Mobility

Abstract

Because the day-to-day experience of wealth was based on the maintenance of credit, it was in a real way ‘fortune’ in the sense of being fortunate, because unpaid debts could easily become liabilities, dragging a household into the courts where its credit and wealth could be lost. Even for competent bookkeepers it was impossible to predict whether their own credit would suffer as a result of the unpaid debts of others, because profit was so dependent on the rapidly changing conditions of supply and demand. When it is considered that such insecurity existed in the competitive conditions of an economy with an oversupply of labour, it is not surprising that men had little confidence in the potential longevity of their wealth — because the institutional security provided by banks and other organizations of scale was just not present.

Debt is a consumer of credit and state, of goods and good name.

(Henry Wilkinson, The Debt Book, 1624)¹

Men tumble up and downe in the world.

(Ralph Josselin, Diary, 1653.)²

By extreme sale of their wares [many tradesmen] become rich for a time but afterward fall again into poverty.

(William Harrison, Description of England, 1587.)³

I have liv’d to see, such is the uncertainty of human affairs, and especially in trade, the furious and outrageous creditor become bankrupt himself in a few years, or perhaps months after, and begging the same mercy of others.

(Daniel Defoe, Complete English Tradesman, 1726)⁴