The fairness of contractual exchange in a private law society : early modern credit markets as a case study

Abstract

Quite apart from the question of the justifiability – based on prior normative commitments – of legal rules controlling the substance of contractual exchange, such as a fair price rule, a common complaint against such rules is based on the difficulties of implementing and enforcing them. Rather than proceeding from first principles, it is also possible to examine the consequences of ex ante and ex post controls on the fairness of contractual exchange in contexts where they have been imposed before testing such consequences against any normative commitments. Such an approach allows both to examine whether practical constraints on enforcing rules over the fairness of exchange are truly binding and, even if they are, whether such rules can have other either beneficial or negative effects on parties and on contract law more broadly. We present a case study of credit markets in a rural community in early modern France marked by the relative absence of the State as a regulatory agent. Our analysis points to, even very provisionally, possible functions of a weak mandatory rule even when overinclusive and difficult to enforce.