Background:
The expression appears to originate from a character in a moralistic tale, The History of Little Goody Two-Shoes, published in 1765, which is believed to have been written by John Newbery, one of London's earliest publishers of children's books.
According to the story, poor Margery Meanwell (who lives in Mouldwell) is an orphan with only one shoe to her name. When she's given a pair she is so pleased that she runs around showing everyone, shouting "Two Shoes". Eventually, through her hard work and virtue, she becomes both educated and rich.
Goody, a contraction of goodwife, was used as a form of address to married women of certain social classes, much as Mrs. is used today.
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