Financing the Dutch Golden Age: The Credit Market of Enkhuizen, 1580-1700

Abstract

Little is known on which credit instruments early modern entrepreneurs used to fund and manage their enterprises. By using the city of Enkhuizen as a case study, this thesis demonstrates that seventeenth-century entrepreneurs used a range of different techniques for this end. Generally, it shows the all-important use of credit in early modern trade. Privately contracted loans and supplier credit formed the basis of early modern funding, especially for small-scale entrepreneurs. The inherent need for credit caused by early modern trade caused entrepreneurs to resort to the local credit market. On this market also creditors had a lot of different investments options. As a result entrepreneurs had to compete with all other types of securities offered on this market. In Enkhuizen, especially securities of Holland and bonds issued by the local chamber of the VOC at times dominated the financial market. Moreover, this thesis demonstrates that even a large company such as the VOC needed to resort to different credit instruments to solve its liquidity needs. Although the local chamber of the VOC was at first anxious to resort to the local credit market, it started to borrow heavily from 1615, and gradually a consolidated debt arose.