Business: Facts on Instalment

Year ago, the highly reputable National Bureau of Economic Research got a fund from the Rockefeller Foundation and the Association of Reserve City Bankers to study instalment credit. It found a red-haired University of Pennsylvania professor named Ralph Young, and a black-haired Hunter College girl named Blanche Bernstein who knew her onions, having plowed through difficult statistical jobs with NRA, WPA, U. S. Department of Labor, etc. These two, with three assistants, were set up in N.B.E.R.’s financial research workshop—an estate (next door to Arturo Toscanini), in swank Riverdale, N. Y., with tennis court, swimming pool, view of the Hudson. Handed to them was a stack of raw material: statistics on the purchases of 60,000 U. S. families, collected by white-collar WPAsters in 1935-36.

Last week the Bureau published The Statistical Pattern of Instalment Debt, a 23-page pamphlet, which told the results of the study of non-relief families in 1935-36. Prime facts:

> Nearly one in four U. S. families were making instalment payments.

> Peak instalment buying was among families with revenues of $1,750-$2,000.

> The 1935-36 recovery caused 70% of instalment-buying families to increase their instalment indebtedness. The net increase amounted to $407,000,000 or $580,000,000 when single persons and relief families were included.

> Automobiles were the largest item of instalment buying in dollar volume, accounted for 50% of the gross increase. Next: furniture (18%); electric refrigerators (15%).

> Heaviest instalment buying was in biggish cities; small cities have less, metropolises like New York and Chicago (where fewer families own automobiles) still less. Farm families did least instalment buying of any.