The Journal of Economic History


Marine Insurance in Britain and America, 1720–1844: A Comparative Institutional Analysis

Christopher Kingston a1
a1 Assistant Professor, Department of Economics, Amherst College, Amherst MA 01002. E-mail:


This article examines how the marine insurance industry evolved in Britain and America during its critical formative period, focusing on the information asymmetries and agency problems that were inherent to the technology of overseas trade at the time, and on the path-dependent manner in which the institutions that addressed these problems evolved. I argue that the market was characterized by multiple equilibria because of a potential lemons problem. Exogenous shocks and endogenous institutional development combined to bring about a bifurcation of institutional structure, the effects of which persist to the present day.