William Scott Green, "Writing with Scripture: The Rabbinic Uses of the Hebrew Bible," Writing with Scripture: The Authority and Uses of the Hebrew Bible in Formative Judaism, ed. Jacob Neusner (Philadelphia, 1989; Atlanta, 1993) 16.
...rabbis reinforced the impression of scripture's autonomy and centrality by making ownership of a sefer Torah a religious obligation for every Jew. From a rabbinic perspective, scripture was not only the distinctive possession of all Israel; more important, it was the personal property of each individual Israelite.
This seems to imply that most Jews in rabbinic times were literate. This is a debated issue within scholarship, as a past post of mine and Steph's comments under it indicate: Jesus the Literate, Slavery, Had Adam and Eve Done It Right.
I like the idea of every Israelite having access to the nourishment of Scripture. But Green also states that Judaism was not always or solely a "religion of the book," for the temple played a huge role in Jewish religious life.
This reminds me of a discussion I once had at Harvard. I was in William Abraham's class on "Crossing the Threshold of Divine Revelation," which had a number of evangelical students. I was a fundamentalist at the time, so I was affirming the inerrancy of the Bible and its vitality in the Christian religious life. The Bible is God's communication to humanity, after all! One of the evangelical students was taking issue with my stance. He said that people in the evangelical sub-culture are used to rituals like daily quiet times, which involve the reading of Scripture. But he wondered if ancient Israel had that same preoccupation. The public reading of the Torah occurred every seven years (Deuteronomy 31:10), which isn't exactly a "daily" or "weekly" quiet time. While I pointed out that the Israelites taught their kids God's commandments and wrote biblical passages on their homes and their gates (Deuteronomy 6:6-9), I now wonder if that constitutes "Bible study" in the modern evangelical sense of the word, since people debate about what exactly the Israelites passed on to their children or wrote on their homes and gates. Was it the shema? The ten commandments? The entire Book of Deuteronomy, or at least the legal parts?
I think that Torah study existed in some way, shape, or form in ancient Israel, since the Psalms talk about meditation on God's law (Psalm 1; 119; etc.). When this occurred in the history of Israelite religion and how widespread it was, I do not know. Maybe the idea of Deuteronomy is that the Israelite people would learn by doing, as the central sanctuary and the courts kept them informed about their obligations. If things ran as they were supposed to run, the Israelites would be part of a culture with rituals and laws, so they'd know what to do. But they'd still need to hear the Torah every seven years for inspiration and to refresh their memories about what specifically God wanted from them. At some point, a more regular meditation/recitation of God's "teaching" was encouraged.