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Purchasing Power: The Economics of Modern Jewish History

Editor(s):Kobrin, Rebecca
Teller, Adam
Reviewer(s):Chiswick, Carmel U.

Published by EH.Net (March 2016)

Rebecca Kobrin and Adam Teller, editors, Purchasing Power: The Economics of Modern Jewish History.  Philadelphia: University of Pennsylvania Press, 2015.  vii + 355 pp. $65 (cloth), ISBN: 978-0-8122-4730-5.

Reviewed for EH.Net by Carmel U. Chiswick, Department of Economics, George Washington University.

Purchasing Power is a collection of eleven well-researched and well-documented essays about the economic life of Jews in a particular industry, time period, or location, usually as producers but sometimes also as consumers.  This subject has only recently been treated seriously as an important aspect of Jewish history, earlier work typically either ignored the practicalities of earning a living or else relied on — or even generated — stereotypes that obscure rather than illuminate.   The editors of Purchasing Power, Rebecca Kobrin of Columbia University and Adam Teller of Brown University, have made a good start on rectifying the situation with this book.

Part I of this collection, “Networks and Niches,” has five historical essays on the economic activities of Jews in various circumstances.  Chapter 1 by Bernard Dov Cooperman (University of Maryland) is about Jewish moneylenders in early modern Rome.  Chapter 2 by Carsten L. Wilke (Central European University, Budapest) focuses on the Jews of the French Pyrenees who held the tobacco monopoly in seventeenth-century Spain.  Chapter 3 by Cornelia Aust (Leibniz-Institute for European History, Mainz, Germany) uses bankruptcy data from eighteenth-century Central Europe to draw insights about the credit-worthiness of Jewish merchants.  Chapter 4 by Glenn Dynner (Sarah Lawrence College) considers whether residential restrictions affected (or did not affect) the success of Jewish businesses in nineteenth-century Poland, including some interesting analysis of unintended consequences.  Chapter 5 by Adam D. Mendelsohn (College of Charleston) tells the story of a family of English Jews that exported clothing to British colonies during the nineteenth century.  Chapter 6 by Jonathan Karp (Binghamton University, SUNY) describes twentieth-century American and British Jews whose economic niche was in (phonograph) record stores catering to collectors of early Rock’n’Roll and folk music.

Together these chapters provide a nuanced view of Jewish business networking, evidence that being Jewish was neither a necessary nor a sufficient condition for inclusion in a successful business relationship.  Most if not all of these networks depended on non-Jews for certain activities, and not every Jew was sufficiently reliable and trustworthy to be included.  In each instance, a person’s good name (i.e., reputation) would be much more important than his religion when it came to building a successful business network.  Jewish businessmen operating in the larger society and belonging to the Jewish community were subject to the (sometimes conflicting) laws and ethical standards of both, and while this could be unduly restrictive it might also provide some wriggle-room for evading the less advantageous legal context.  In a hostile socio-political environment Jews might make a living in niche industries that were scorned by others, but even in friendly environments Jewish innovators created successful niches in new industries or markets.  The reader cannot help but be struck by the entrepreneurship and innovation demonstrated in these chapters.

While the chapters in Part I focus on how Jews earned a living, those in Part II give examples of how economically successful Jews used their wealth to help their less-fortunate co-religionists.  Chapter 7 by Abigail Green (Brasenose College and University of Oxford) considers the nineteenth-century appearance of international Jewish philanthropy, as increasingly high-income Jews in the liberal West tried to alleviate the poverty and powerlessness of Oriental Jews.  Chapter 8 by Derek Penslar (University of Oxford and University of Toronto) describes how Israel was able to finance its 1948 War of Independence with donations from Diaspora Jewish organizations, from wealthy Jewish philanthropists, and from the many contributions of individual middle- and low-income Western (especially American) Jews.  Chapter 9 by Veerle Vanden Daelon (Centre for Historical Research and Documentation on War and Contemporary Society in Brussels) follows the fortunes (good and bad) of Antwerp’s Jews in the diamond industry as they weathered the crises of two World Wars, struggled with the twin challenges of modernization and globalization, and interacted with Belgian governments that were sometimes friendly and sometimes not.  Chapter 10 by Jonathan Dekel-Chen (Hebrew University of Jerusalem) takes the late twentieth-century “Free Soviet Jewry” movement as an example of how financial resources and political activism greatly influenced Jewish communities in the U.S. and UK, even though it is unclear how much of this actually effected change in the Soviet Union.  Chapter 11 by Adam Sutcliffe (King’s College, London) concludes the volume with a re-examination of how Werner Sombart’s important work on Jews and capitalism reflected the popular stereotypes of his time and place, influencing the politics of Jewish economic history for decades to come.

With a few exceptions, Purchasing Power focuses on big successes, whether tracing the growth of business empires or the distribution of wealth to improve the welfare of others.  It is a welcome contribution to the growing literature on the economic activities of Jews.  Part I is myth-busting, providing evidence that the most successful Jewish commercial networks were probably not nearly so parochial as common stereotypes might suggest.  Part II deals with another stereotype, that of a few powerful Jews using their wealth to manipulate world events, but its focus is on politics within the Jewish community rather than influences on the larger society.  Each of the two Parts are composed of chapters that are themselves useful references that open new doors for further research.

As an economist interested in Jewish economic history, I welcome the (belated) entry of historians into this field.  I look forward, however, to new studies that place this literature in a broader perspective.   Most Jews would have earned their livelihood in small businesses, in crafts and trades, or in professions like medicine or clergy, and it would be interesting to know how their economic lives affected the Jewish community as well as the broader economy.  Since Jews were typically a tiny minority in their respective societies, it would be interesting to compare their philanthropic patterns with those of non-Jewish neighbors.  (Any such comparison might well consider that religious philanthropy typically occurred in the context of a state religion for non-Jews but not for Jews, an important difference explored in the growing literature on the economics of religion.)  Perhaps the greatest contribution made by the collection of essays in Purchasing Power is that each chapter is important not only for the light it sheds on the economic activity of Jews but also as a foundation for further research into the economic history of the Jewish people.

Carmel U. Chiswick is the author of Judaism in Transition:  How Economic Choices Shape Religious Tradition, Stanford University Press, 2014.

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Subject(s):Business History
Financial Markets, Financial Institutions, and Monetary History
History of Economic Thought; Methodology
International and Domestic Trade and Relations
Markets and Institutions
Social and Cultural History, including Race, Ethnicity and Gender
Geographic Area(s):Europe
Middle East
North America
Time Period(s):16th Century
17th Century
18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII