Internal bank archives are used to examine the nature of English bank/firm relationships during periods of business distress in the decades before 1914. The performance of the banks is examined in the context of theoretical assertions regarding relationship and transaction banking and bank response to the problems of adverse selection and moral hazard. New estimates of bank losses on industrial accounts are made. The results indicate that the banks supported their industrial clients during periods of distress by continuing with existing loans but rarely became deeply involved with clients' business. Effective screening of loan applications, the use of short-term loans and of sample collateral stipulations safeguarded against moral hazard and minimised losses for the banks, even with such high risk accounts.

In this paper we try to isolate and measure the respective importance of political and economic aspects in two critical episodes of France interwar. We do this by separating expectations of taxation and of devaluation that are implicitly included in the prices of various categories of French and foreign bonds. Concerning the 1924–26 crisis, we show first that there was no expectation of a government default; second that the rise of interest rates in 1925 results from expectations of a capital levy; third that no hyperinflation was ever expected. After stabilisation, we show that the markets expected an appreciation of the franc up to 1931 and a devaluation afterwards.

The paper investigates the initial phase of the cooperative organisation of agricultural processing firms in Denmark. It argues that the variations observed can be explained within the framework of the theory of industrial organisation. The focus is on the success of cooperative creameries. In 1903, twenty years after the first establishments, the owners of about 80 per cent of all Danish milch cows supplied their product to a cooperative. The success of cooperatives within other fields of production was smaller by comparison. The point is that dairying cooperatives, given the existing technology of gathering information and of preserving and transporting a perishable product, were ideally suited to overcome the problems of potential lock-in and of asymmetric information.

Did the relatively high level of literacy in Sweden prior to 1850 play any role in agrarian change and economic growth? According to influential scholars, such as Carlo Cipolla and Lars Sandberg, this was not the case. In this article, however, the authors put forward literacy as a transaction technology. Freeholders in the agrarian economy that expanded during the early nineteenth century used it as such and empirical evidence is presented for its significance during the enclosure movement and in the expansion of the rural credit market. The authors also discuss the use of literacy as a proxy-variable for ‘human capital’ or ‘knowledge’ in growth accounting and stress the existence of different literacy cultures. They maintain that the functional literacy of the Swedish freeholders – reading and writing – can be used as a proxy-variable for human capital. That is not necessarily the case with the mere reading ability more typical for women, tenants on manorial land, and the lower agrarian classes. The Swedish example indicates that the literacy variables used in international comparisons actually mirror very different kinds of literacy.