P. W. S. Andrews: circular letter to builders , [July 1939] [d]


See accompanying letter to Harrod


Institute of Statistics, Oxford

[July 1939]

Dear Sir,

I ask your patient consideration of the questionnaire which I have taken the liberty of enclosing, and will explain the reason for my approaching you.

I am writing on behalf of a group of economists in Oxford which is studying the question of trade fluctuation. Its special interest is to bring the theory of the subject which, as you are aware, is of the greatest importance for national economic and financial policy, into closer relation with the facts of business life. We have interviewed a number of representative producers and traders with this object.

One department of our study is the influence of the rate of interest. We have secured answers to questions on this matter from about 400 business men, but they included only one or two builders.

It has occurred to us that the building industry, supplying as it does durable consumers' and producers' goods, should be more carefully investigated. We have therefore modified our original questionnaire to suit the special circumstances of the building industry. This is the questionnaire enclosed (Q 11 R). It is intended to secure information as to whether the cost of borrowing money, or the facility with which loans can be obtained, has affected various decisions by those responsible for the supply of building.

At the same time, the peculiar position of the building industry makes us anxious to know more about the demand side--about any effect that the factors which we enumerate in our questionnaire may have on the demand for your houses or buildings. It is appreciated that it will not be possible for you to give such specific information on this matter as upon your personal decisions. I therefore ask about these less formally in this letter, as follows:--

Our general question is

What information can you give us about any instance you know of the factors a to i mentioned in our questionnaire 1 causing users of either domestic or industrial or commercial buildings to anticipate "building" (this phrase to cover reconstruction and repairs) which they would not otherwise have done until later; to order or to acquire domestic or industrial or commercial "building" which otherwise they would not have done at all, or to postpone "building" either for a period or indefinitely, which they would otherwise have had done.

We particularly want instances with dates of such favourable or unfavourable effects on the demand side and at the same time would like your general opinion upon this matter. A separate sheet is attached at the end of this letter headed "Demand Side", for your answer to this question. The supply side, namely the question of how your own decisions are directly affected by interest rates, and not merely through a change in demand, is covered by the questionnaire enclosed. A blank sheet for additional comments on the supply side is also enclosed.

We do not need to have your name on the replies. We should, however, like you to put your identity on the reply so that we may acknowledge it and, subsequently, send you a copy of any publication that may result. In any event your reply will be treated as strictly confidential. All published reference to information received will be strictly anonymous, and extreme care will be taken when publishing that no information is disclosed which could indirectly lead to the identification of a particular firm. As above mentioned, about 400 business men have provided us with information, often extremely confidential, in answer to our various inquiries, subject to similar assurances.

Should you feel that, before replying, you would like a personal interview with a member of the Group, I shall be very pleased to endeavour to arrange one.

Hoping that you will be good enough to co-operate with us by providing answers,

Yours very truly,


p.p. [not signed]


Oxford Economists' Research Group

  1. 1. Since only a few builders replied to the Oxford Economists' Research Group February 1939 questionnaire on the rate of interest, the Group circulated a modified questionnaire suited for the building industry. The accompanying letter was drafted by Andrews, and sent to Harrod for comments (see P. W. S. Andrews, "A Further Inquiry into the Effects of Rates of Interest", Oxford Economic Papers 3, March 1940, pp. 33-73).

    The final draft is reported here after Harrod's letter. As can easily be ascertained, most of Harrod's suggestions were incorporated in the final version, while a couple of observations led to partial redrafting of the text.

    2. See [jump to page] .

    3. See [jump to page] .

    4. Page not indicated in Ms.

    5. See footnote [i] to [jump to page] .

    6. No correspondence is extant between Harrod and Kahn on this matter.

    7. Refers to the questionnaire cited in note 1 to this letter.

    1. a. ALS, four pages on two leaves, in ABP 45.

      b. Quotation marks added.

      c. Indentation emended in order to facilitate the reading.

      d. TL, mimeo, not signed, four pages on four leaves, in ABP 49 and 170.

1. These are :

a. Bank Rate

b. Rate of Discount on Bills

c. The level of interest charged on bank overdrafts

d. The facility with which bank overdrafts can be obtained

e. The rate of interest charged on loans from building societies or mortgage brokers

f. The facility with which loans can be obtained from building societies or mortgage brokers.

g. The yield on government securities

h. (If a public company) the price at which your shares are being quoted.

i. (If a public company) the facility with which you can raise new capital from the public [Andrews's footnote].

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