Years of plenty, years of want? An introduction to finance and the family life cycle

ABSTRACT Research suggests that until recently families in history could only avoid episodes of poverty if they put money aside. By helping to smooth consumption over the family life cycle, finance could prevent impoverishment, and is also likely to have had an effect on family life. Saving may have influenced cohabitation structures and the timing and incidence of birth, marriage, and death. That families depended on finance is underlined by the fact that some financial institutions and instruments were specifically developed to help families to smooth consumption over the life cycle. Families’ demand for finance thus also shaped financial institutions and instruments. This Introduction provides an overview of how families’ demand for finance shaped financial institutions and instruments, and how finance may have helped families to prevent episodes of poverty, and explains how the contributions to this special issue tie into this.