ABSTRACT
This chapter shows that the central importance of the bill of exchange as a means of payment during the industrial revolution and the legal reasons for its contribution to bankruptcy proliferation. It designs to throw further light upon both of these topics by examining some of the leading bankruptcies in the 1810 crisis. The chapter suggests that the communication of commercial distress during the crisis of 1810 was largely attributable to the widespread use of bills of exchange. Before illustrating this process it is necessary to discuss briefly the bill mechanism and to explain its popularity, abuse and status in bankruptcy proceedings. The bill became the principal instrument of international payments and by the end of the seventeenth century a sophisticated foreign exchange market had developed in London. The bill was popular essentially because the alternative forms of payment were either inadequate or less well-developed.
