Consumer Credit on the Eve of Affluence

2018 ◽  
pp. 20-47
Author(s):  
Stuart Aveyard ◽  
Paul Corthorn ◽  
Sean O’Connell
Keyword(s):  
Consumer Protection ◽  
Free Market ◽  
Demand Management ◽  
Consumer Credit ◽  
Credit Market ◽  
Balance Of Payments ◽  
Consumer Durables ◽  
Keynesian Theory ◽  
Election Victory

The chapter begins with an examination of debates around consumer protection and hire purchase in the 1930s. It explains the emergence and significance of the Hire Purchase Act, 1938. It explores radical (but thwarted) Labour plans to reshape important sectors of the consumer credit market during the 1940s. The chapter then explains the influence of Keynesian theory and its role in generating new policy on economic demand management. The Conservative election victory of 1951 owed much to the party’s courtship of voters with free market rhetoric, but this government instigated hire purchase controls to improve the balance of payments and combat inflation. Labour dubbed the measures ‘a very vicious piece of class legislation’. This policy created long-standing disagreement between the Treasury and the Board of Trade (and consumer durables manufacturers) about the damage to UK manufacturing. The chapter outlines developments up until the Radcliffe Committee was tasked to examine the issue.

Regulating the Price of Consumer Credit

1971 ◽  
Vol 35 (4) ◽  
pp. 21-28 ◽  
Author(s):  
John J. Wheatley ◽  
Guy G. Gordon
Keyword(s):  
Consumer Protection ◽  
Low Income ◽  
Free Market ◽  
Consumer Credit ◽  
Market Process ◽  
Protection Devices ◽  
Credit Channels ◽  
The Impact ◽  
Low Income Consumers

Laws to limit the rate of interest or service charges on consumer credit are presented as consumer protection devices on the grounds that credit grantors have an advantage over their customers. Opponents of such laws argue that they impair the free market process, that consumers will have to pay credit costs indirectly (such as through increased prices), and that low-income consumers may be forced out of regular credit channels and into the arms of illegal loan sharks. This article summarizes a study to determine the impact of a credit rate limitation law on businesses and consumers.

Crisis and Credit Control, 1964–1971

2018 ◽  
pp. 93-123
Author(s):  
Stuart Aveyard ◽  
Paul Corthorn ◽  
Sean O’Connell
Keyword(s):  
Demand Management ◽  
Consumer Credit ◽  
Bank Lending ◽  
Management Tool ◽  
Economic Management ◽  
Consumer Durables ◽  
British Industry ◽  
The Uk ◽  
The Cost ◽  
The International Monetary Fund

Between 1964 and 1971 the UK suffered great economic difficulties, including repeated balance of payments crises, leading to a prolonged credit squeeze, the seeking of loans from the International Monetary Fund (IMF), and the devaluation of sterling in 1967. These issues dominated control over consumer credit. Hire purchase terms control continued to feature in government economic management, producing stronger objections from the consumer durables sector. While the Treasury saw them as a useful demand management tool, the Board of Trade complained of their damage to British industry and the Crowther Committee established to examine consumer credit called for their abandonment. There was also growing pressure, particularly from the Bank of England, to move away from the use of ceilings on bank lending. In 1971, a new system of credit control was introduced, reliant on changes in the cost of credit rather than restrictions on its overall availability.

The Economic and Social Background to the Consumer Durables Revolution

2017 ◽  
Author(s):  
Peter Scott
Keyword(s):  
Durable Goods ◽  
Consumer Credit ◽  
Social Background ◽  
Living Standards ◽  
Consumer Expenditure ◽  
Household Demand ◽  
Fertility Rates ◽  
Real Wages ◽  
Consumer Durables ◽  
Technological Improvements

By 1939 rising living standards provided access to an array of durable goods that many people regarded as necessities, but would have been beyond the dreams of their parents twenty-five years earlier. Rising real wages, falling fertility rates, and an expansion and liberalization of consumer credit, collectively made affordable goods that cost several weeks’, months’, or (in the case of housing) years’ income. This chapter examines these trends and then discusses their impacts on household demand for durable goods. For most durables, demand is shown to have risen substantially faster than incomes, producing a major rise in their share of total consumer expenditure. This was partly driven by technological improvements, though successful marketing (both of the goods and the consumer credit that made them affordable) also played a key role.

A Sisyphean Task

2018 ◽  
pp. 72-92
Author(s):  
Stuart Aveyard ◽  
Paul Corthorn ◽  
Sean O’Connell
Keyword(s):  
Monetary Policy ◽  
Consumer Protection ◽  
Consumer Credit ◽  
Strong Impact ◽  
Cooperative Movement ◽  
Consumer Durable ◽  
Affluent Society ◽  
The Impact

Chapter 3 examines debates about controls on consumer credit from late 1957 to 1964. As in Chapter 2, this chapter provides a fresh appraisal of Labour’s response to the affluent society. The party attempted to outflank the Conservatives on the issue of consumer protection. It embarrassed the Conservatives over their sluggish response to the Molony Committee’s recommendations on hire purchase legislation. The chapter also supports previous analyses that have identified the strong impact of new consumerist groups, particularly the Consumers’ Association and the weakening role of the Cooperative Movement. The issue of credit controls became more contentious. The Radcliffe Committee on monetary policy (1958) highlighted the weaknesses of the system. Of particular concern was the impact of controls on consumer durable industries. They were removed in 1958, but reintroduced, in 1960, following a dangerous rise in consumer indebtedness.

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