This paper explores the phenomenon of as practiced in mid-nineteenth-century California. A sample of newspaper advertisements from 1857 76 reveals that despite the obvious inefficiencies of linking labor and capital markets, job-loan trading was both common and profitable. I assess labor market bonding against moral hazard or adverse selection as a possible explanation, but conclude that the job-loan trades primarily provide evidence of substantial Pacific Coast capital market imperfections. This conclusion has implications for the broader question of how financial markets develop.
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Volume (Year): 54 (1994) Issue (Month): 01 (March) Pages: 34-63 Download reference. The following formats are available: HTML
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