Moral Economy, Informal Insurance, or What? The Logic and Effectiveness of Informal Transfers between Households in Early 20th Century Finland

Sakari Saaritsa, University of Helsinki

Informal transfers between households have been the subject of much research in economic history and development economics, as they have been suggested to play an important role in providing support to those in need, particularly in contexts where formal safety nets are lacking. Empirical data enabling thorough historical analysis is rare. This paper aims to analyze informal transfers between households in early 20th century Finland using household budget data from approximately 1700 households from rural and urban contexts, including within-year panel data. The study will explore the determinants of transfers statistically and investigate their effectiveness. The data includes variables on gifts and assistance, informal credit, and savings. The paper will draw on literature on informal insurance in development economics and build upon previous work by the author (2008 and 2011). It will seek to understand the logic that determined informal transfers and relate it to new advances in informal insurance literature in development economics. The paper will also examine the effectiveness of informal transfers in income smoothing, and heterogeneity in effectiveness along the income distribution. The findings will contribute to an empirical understanding of the historical role of informal transfers in shaping economic outcomes and have implications for understanding the dynamics of informal transfers in other contexts.

No extended abstract or paper available

 Presented in Session 133. Presidential Session: Household Wealth and Well-Being