Hostname: page-component-76fb5796d-wq484 Total loading time: 0 Render date: 2024-04-26T16:26:16.965Z Has data issue: false hasContentIssue false
  • English
  • Français

Working-Class Household Consumption Smoothing in Interwar Britain

Published online by Cambridge University Press:  22 August 2012

PETER M. SCOTT  and
JAMES WALKER
PETER M. SCOTT*
Affiliation:
Professor of International Business History, Henley Business School at the University of Reading, P.O. Box 218, Whiteknights, Reading, Berkshire RG6 6AA, United Kingdom. E-mail: p.m.scott@henley.reading.ac.uk.
JAMES WALKER*
Affiliation:
Reader International Business and Strategy, Henley Business School at the University of Reading, P.O. Box 218, Whiteknights, Reading, Berkshire RG6 6AA, United Kingdom. E-mail: j.t.walker@henley.reading.ac.uk.
Get access Rights & Permissions [Opens in a new window]

Abstract

We examine the strategies interwar working-class British households used to “smooth” consumption over time and guard against negative contingencies such as illness, unemployment, and death. Newly discovered returns from the U.K. Ministry of Labour's 1937/38 Household Expenditure Survey are used to fully categorize expenditure smoothing via nineteen credit/savings vehicles. We find that households made extensive use of expenditure-smoothing devices. Families' reliance on expenditure-smoothing is shown to be inversely related to household income, while households also used these mechanisms more intensively during expenditure crisis phases of the family life cycle, especially the years immediately after new household formation.

Type
ARTICLES
Information
The Journal of Economic History , Volume 72 , Issue 3 , 22 August 2012 , pp. 797 - 825
Copyright
Copyright © The Economic History Association 2012

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Marks & Spencer plc Archives, A05 413 D. Annual Report of the Joint Secretary and Chief Accountant, 1938 (1939).Google Scholar
Mass Observation Archive, University of Sussex, Topic Collection.Google Scholar
The National Archives, London (TNA), LAB 17, Papers of the 1937/38 Ministry of Labour Working-Class Household Expenditure Survey.Google Scholar
University of East Anglia Archives, Pritchard Papers.Google Scholar
Women's Library, London Metropolitan University. Women's Group on Public Welfare Papers.Google Scholar
Ardener, Shirley.. “The Comparative Study of Rotating Credit Associations.” Journal of the Royal Anthropological Institute of Great Britain and Ireland 94, no. 2 (1964): 202–29.CrossRefGoogle Scholar
Banerjee, Abhijit V., Besley, Tim, and Guinnane, Timothy W.. “Thy Neighbor's Keeper: The Design of a Credit Cooperative with Theory and a Test.” Quarterly Journal of Economics 109, no. 2 (1994): 491–515.CrossRefGoogle Scholar
Banerjee, Abhijit V., and Duflo, Esther. “The Economic Lives of the Poor.” Journal of Economic Perspectives 21, no. 1 (2007): 141–68.CrossRefGoogle ScholarPubMed
Benson, Susan P.Counter Cultures: Saleswomen, Managers, and Customers in American Department Stores, 1890-1940. Urbana: University of Illinois Press, 1988.Google Scholar
Besley, Tim.. “Savings, Credit, and Insurance.” In Handbook of Development Economics, Volume 3, Chapter 36, edited by Behrman, Jere and Scrinivasan, T. N., 2123–2207. Amsterdam: Elsevier, 1995.Google Scholar
Besley, TimCoate, Stephen, and Loury, Glenn. “The Economics of Rotating Savings and Credit Associations.” American Economic Review 83, no. 4 (1993): 792–810.Google Scholar
Bonfield, Margaret.. Our Towns: A Close-Up. London: Oxford University Press, 1944.Google Scholar
Boyer, George.. “Living Standards, 1860-1939.” In The Cambridge Economic History of Modern Britain. Volume II: Economic Maturity, 1860-1939, edited by Floud, Roderick and Johnson, Paul, 280–313. Cambridge: Cambridge University Press, 2004.CrossRefGoogle Scholar
Carr-Saunders, , Morris, Alexander, Sargant Florence, Philip, and Peers, Robert. Consumers' Co-operation in Great Britain. London: Allen & Unwin, 1942.Google Scholar
Cherry, Steven.. “Before the National Health Service: Financing the Voluntary Hospitals, 1900-1939.” Economic History Review 50, no. 2 (1997): 305–26.CrossRefGoogle Scholar
Co-operative Union. Report of the Seventieth Annual Co-operative Congress, Scarborough, 1938. Manchester: Co-operative Union, 1938.Google Scholar
Coopey, RichardO'Connell, Sean, and Porter, Dilwyn. Mail Order Retailing in Britain: A Business and Social History. Oxford: Oxford University Press, 2005.CrossRefGoogle Scholar
Daunton, Martin.. “Payment and Participation: Welfare and State Formation in Britain 1900-1951.” Past & Present 150 (1996): 169–216.CrossRefGoogle Scholar
Dyhouse, Carol.. “Working-Class Mothers and Infant Mortality in England, 1895-1914.” Journal of Social History 12, no. 2 (1978): 248–67.CrossRefGoogle ScholarPubMed
Gazeley, Ian and Newell, Andrew. “The End of Destitution: Evidence from Urban British Working Households, 1904-37.” Oxford Economic Papers (forthcoming).Google Scholar
Geertz, Clifford.. “The Rotating Credit and Saving Association: A ‘Middle Rung' in Development.” Economic Development and Cultural Change 10, no. 3 (1962): 241–63.CrossRefGoogle Scholar
Guinnane, Timothy W. “A Failed Institutional Transplant: Raiffeisen's Credit Cooperatives in Ireland, 1894-1914.” Explorations in Economic History 31, no. 1 (1994): 38–61.CrossRefGoogle Scholar
Guinnane, Timothy W. “Cooperatives as Information Machines: German Rural Credit Cooperatives, 1883-1914.” The Journal of Economic History 61, no. 2 (2001): 366–89.CrossRefGoogle Scholar
Hannah, Leslie.. Inventing Retirement: The Development of Occupational Pensions in Britain. Cambridge: Cambridge University Press, 1986.CrossRefGoogle Scholar
Harris, Bernard.. The Origins of the British Welfare State: Social Welfare in England and Wales, 1800-1945. Basingstoke: Palgrave Macmillan, 2004.CrossRefGoogle Scholar
Hilton, John.. Rich Man, Poor Man. London: Allen & Unwin, 1938.Google Scholar
Hilton, Matthew.. Consumerism in Twentieth-Century Britain: The Search for a Historical Movement. Cambridge: Cambridge University Press, 2003.CrossRefGoogle Scholar
Jefferys, J. B.Retail Trading in Britain, 1850-1950. Cambridge: Cambridge University Press, 1954.Google Scholar
Johnson, Paul.. Saving and Spending: The Working-Class Economy in Britain, 1870-1939. Oxford: Oxford University Press, 1985.Google Scholar
Lee, C. H.British Regional Employment Statistics, 1841-1971. Cambridge: Cambridge University Press, 1980.Google Scholar
Mishkin, Frederic S. “The Household Balance Sheet and the Great Depression.” The Journal of Economic History 38, no. 4 (1978): 918–37.CrossRefGoogle Scholar
O'Connell, Sean. Credit and Community: Working-Class Debt in the UK Since 1880. Oxford: Oxford University Press, 2009.CrossRefGoogle Scholar
O'Connell, Sean and Reid, Chris. “Working-Class Consumer Credit in the UK, 1925-60: The Role of the Check Trader.” Economic History Review 57, no. 2 (2005): 378–405.CrossRefGoogle Scholar
Olney, Martha.. Buy Now, Pay Later: Advertising, Credit, and Consumer Durables in the 1920s. Chapel Hill: University of North Carolina Press, 1991.Google Scholar
Pilgrim Trust. Men Without Work. Cambridge: Cambridge University Press, 1938.Google Scholar
Parker, Jonathan A., and Preston, Bruce. “Precautionary Saving and Consumption Fluctuations.” American Economic Review 95, no. 4 (2005): 1119–43.CrossRefGoogle Scholar
Prais, S. J. and Houthakker, Hendrik S.. The Analysis of Family Budgets, Second Impression. Cambridge: Cambridge University Press, 1971.Google Scholar
Rowntree, Benjamin Seebohm. Poverty: A Study of Town Life. London: Macmillan, 1901.Google Scholar
Rowntree, Benjamin SeebohmPoverty and Progress: A Second Social Survey of York. London: Longmans, 1941.Google Scholar
Scott, Peter.. “The Twilight World of Interwar Hire Purchase.” Past & Present 177, no. 1 (2002): 195–225.CrossRefGoogle Scholar
Scott, Peter.. “Did Owner-Occupation Lead to Smaller Families for Interwar Working-Class Households?” Economic History Review, 61, no. 1 (2007): 99–124.CrossRefGoogle Scholar
Scott, Peter.. “Mr. Drage, Mr. Everyman, and the Creation of a Mass Market for Domestic Furniture in Interwar Britain.” Economic History Review 62, no. 4 (2009): 802–27.CrossRefGoogle Scholar
Taylor, Avram.. Working-Class Credit and Community Since 1918. Basingstoke: Palgrave Macmilan, 2002.CrossRefGoogle Scholar
Topham, Edward and Simm, J. S.. Mutuality Club Trading. Manchester: Co-operative Union, 1931.Google Scholar
Trumbull, J. Gunnar, “Regulating for Legitimacy: Consumer Credit Access in France and America.” Paper presented at 2011 EHA meeting, Boston.CrossRefGoogle Scholar
United Kingdom, Parliament, Royal Commission on the Distribution of the Industrial Population. Report (Cmd. 6153 of 1940). London: HMSO, 1940.Google Scholar
Vincent, David.. Poor Citizens: The State and the Poor in Twentieth-Century Britain. London: Longmans, 1991.Google Scholar
Marks & Spencer plc Archives, A05 413 D. Annual Report of the Joint Secretary and Chief Accountant, 1938 (1939).Google Scholar
Mass Observation Archive, University of Sussex, Topic Collection.Google Scholar
The National Archives, London (TNA), LAB 17, Papers of the 1937/38 Ministry of Labour Working-Class Household Expenditure Survey.Google Scholar
University of East Anglia Archives, Pritchard Papers.Google Scholar
Women's Library, London Metropolitan University. Women's Group on Public Welfare Papers.Google Scholar
Ardener, Shirley.. “The Comparative Study of Rotating Credit Associations.” Journal of the Royal Anthropological Institute of Great Britain and Ireland 94, no. 2 (1964): 202–29.CrossRefGoogle Scholar
Banerjee, Abhijit V., Besley, Tim, and Guinnane, Timothy W.. “Thy Neighbor's Keeper: The Design of a Credit Cooperative with Theory and a Test.” Quarterly Journal of Economics 109, no. 2 (1994): 491–515.CrossRefGoogle Scholar
Banerjee, Abhijit V., and Duflo, Esther. “The Economic Lives of the Poor.” Journal of Economic Perspectives 21, no. 1 (2007): 141–68.CrossRefGoogle ScholarPubMed
Benson, Susan P.Counter Cultures: Saleswomen, Managers, and Customers in American Department Stores, 1890-1940. Urbana: University of Illinois Press, 1988.Google Scholar
Besley, Tim.. “Savings, Credit, and Insurance.” In Handbook of Development Economics, Volume 3, Chapter 36, edited by Behrman, Jere and Scrinivasan, T. N., 2123–2207. Amsterdam: Elsevier, 1995.Google Scholar
Besley, TimCoate, Stephen, and Loury, Glenn. “The Economics of Rotating Savings and Credit Associations.” American Economic Review 83, no. 4 (1993): 792–810.Google Scholar
Bonfield, Margaret.. Our Towns: A Close-Up. London: Oxford University Press, 1944.Google Scholar
Boyer, George.. “Living Standards, 1860-1939.” In The Cambridge Economic History of Modern Britain. Volume II: Economic Maturity, 1860-1939, edited by Floud, Roderick and Johnson, Paul, 280–313. Cambridge: Cambridge University Press, 2004.CrossRefGoogle Scholar
Carr-Saunders, , Morris, Alexander, Sargant Florence, Philip, and Peers, Robert. Consumers' Co-operation in Great Britain. London: Allen & Unwin, 1942.Google Scholar
Cherry, Steven.. “Before the National Health Service: Financing the Voluntary Hospitals, 1900-1939.” Economic History Review 50, no. 2 (1997): 305–26.CrossRefGoogle Scholar
Co-operative Union. Report of the Seventieth Annual Co-operative Congress, Scarborough, 1938. Manchester: Co-operative Union, 1938.Google Scholar
Coopey, RichardO'Connell, Sean, and Porter, Dilwyn. Mail Order Retailing in Britain: A Business and Social History. Oxford: Oxford University Press, 2005.CrossRefGoogle Scholar
Daunton, Martin.. “Payment and Participation: Welfare and State Formation in Britain 1900-1951.” Past & Present 150 (1996): 169–216.CrossRefGoogle Scholar
Dyhouse, Carol.. “Working-Class Mothers and Infant Mortality in England, 1895-1914.” Journal of Social History 12, no. 2 (1978): 248–67.CrossRefGoogle ScholarPubMed
Gazeley, Ian and Newell, Andrew. “The End of Destitution: Evidence from Urban British Working Households, 1904-37.” Oxford Economic Papers (forthcoming).Google Scholar
Geertz, Clifford.. “The Rotating Credit and Saving Association: A ‘Middle Rung' in Development.” Economic Development and Cultural Change 10, no. 3 (1962): 241–63.CrossRefGoogle Scholar
Guinnane, Timothy W. “A Failed Institutional Transplant: Raiffeisen's Credit Cooperatives in Ireland, 1894-1914.” Explorations in Economic History 31, no. 1 (1994): 38–61.CrossRefGoogle Scholar
Guinnane, Timothy W. “Cooperatives as Information Machines: German Rural Credit Cooperatives, 1883-1914.” The Journal of Economic History 61, no. 2 (2001): 366–89.CrossRefGoogle Scholar
Hannah, Leslie.. Inventing Retirement: The Development of Occupational Pensions in Britain. Cambridge: Cambridge University Press, 1986.CrossRefGoogle Scholar
Harris, Bernard.. The Origins of the British Welfare State: Social Welfare in England and Wales, 1800-1945. Basingstoke: Palgrave Macmillan, 2004.CrossRefGoogle Scholar
Hilton, John.. Rich Man, Poor Man. London: Allen & Unwin, 1938.Google Scholar
Hilton, Matthew.. Consumerism in Twentieth-Century Britain: The Search for a Historical Movement. Cambridge: Cambridge University Press, 2003.CrossRefGoogle Scholar
Jefferys, J. B.Retail Trading in Britain, 1850-1950. Cambridge: Cambridge University Press, 1954.Google Scholar
Johnson, Paul.. Saving and Spending: The Working-Class Economy in Britain, 1870-1939. Oxford: Oxford University Press, 1985.Google Scholar
Lee, C. H.British Regional Employment Statistics, 1841-1971. Cambridge: Cambridge University Press, 1980.Google Scholar
Mishkin, Frederic S. “The Household Balance Sheet and the Great Depression.” The Journal of Economic History 38, no. 4 (1978): 918–37.CrossRefGoogle Scholar
O'Connell, Sean. Credit and Community: Working-Class Debt in the UK Since 1880. Oxford: Oxford University Press, 2009.CrossRefGoogle Scholar
O'Connell, Sean and Reid, Chris. “Working-Class Consumer Credit in the UK, 1925-60: The Role of the Check Trader.” Economic History Review 57, no. 2 (2005): 378–405.CrossRefGoogle Scholar
Olney, Martha.. Buy Now, Pay Later: Advertising, Credit, and Consumer Durables in the 1920s. Chapel Hill: University of North Carolina Press, 1991.Google Scholar
Pilgrim Trust. Men Without Work. Cambridge: Cambridge University Press, 1938.Google Scholar
Parker, Jonathan A., and Preston, Bruce. “Precautionary Saving and Consumption Fluctuations.” American Economic Review 95, no. 4 (2005): 1119–43.CrossRefGoogle Scholar
Prais, S. J. and Houthakker, Hendrik S.. The Analysis of Family Budgets, Second Impression. Cambridge: Cambridge University Press, 1971.Google Scholar
Rowntree, Benjamin Seebohm. Poverty: A Study of Town Life. London: Macmillan, 1901.Google Scholar
Rowntree, Benjamin SeebohmPoverty and Progress: A Second Social Survey of York. London: Longmans, 1941.Google Scholar
Scott, Peter.. “The Twilight World of Interwar Hire Purchase.” Past & Present 177, no. 1 (2002): 195–225.CrossRefGoogle Scholar
Scott, Peter.. “Did Owner-Occupation Lead to Smaller Families for Interwar Working-Class Households?” Economic History Review, 61, no. 1 (2007): 99–124.CrossRefGoogle Scholar
Scott, Peter.. “Mr. Drage, Mr. Everyman, and the Creation of a Mass Market for Domestic Furniture in Interwar Britain.” Economic History Review 62, no. 4 (2009): 802–27.CrossRefGoogle Scholar
Taylor, Avram.. Working-Class Credit and Community Since 1918. Basingstoke: Palgrave Macmilan, 2002.CrossRefGoogle Scholar
Topham, Edward and Simm, J. S.. Mutuality Club Trading. Manchester: Co-operative Union, 1931.Google Scholar
Trumbull, J. Gunnar, “Regulating for Legitimacy: Consumer Credit Access in France and America.” Paper presented at 2011 EHA meeting, Boston.CrossRefGoogle Scholar
United Kingdom, Parliament, Royal Commission on the Distribution of the Industrial Population. Report (Cmd. 6153 of 1940). London: HMSO, 1940.Google Scholar
Vincent, David.. Poor Citizens: The State and the Poor in Twentieth-Century Britain. London: Longmans, 1991.Google Scholar