Brian W. Kernighan and Rob Pike, chapter 2.6 -- "The Directory Hierarchy":
"/etc (et cetera) we have also seen before. It contains various administrative files such as the password file and some systems programs such as /etc/getty, which initializes a terminal connection for /bin/login. /etc/rc is a file of shell commands that is executed after the system is bootstrapped. /etc/group list the members of each group."
I looked through Ritchie and Thompson's "The UNIX Time-Sharing System" and found no mention of /etc, so that's the best I could do from my own bookshelf.