Economics at LSE since 1895

1. Foundation, 1895

"The growing importance of social and economic subjects has drawn attention to the need of further provision for systematic training in economic and political science, and the promotion of original investigation and research… It is now proposed to attempt to remedy this deficiency (by establishing the London School of Economics and Political Science)." LSE Calendar, 1895-96.

The School's first Director, W A S Hewins stated that, "The significance of the foundation of the London School of Economics was that the institution was deliberately intended to represent important aspects of economic science and practical investigation whether they were in agreement or not with orthodox economics."

Friedrich von Hayek later pointed out that if Sidney Webb (founder of LSE) and Hewins were guided by any one conviction "it was that the theoretical and individualistic economics of Ricardo and Mill had kept their dominant position far too long and that it was time to give other schools a chance."

Edwin Cannan was the principal economist at LSE from its foundation until his retirement in 1926. His lectures to first year students were published in 1914 as Wealth: a brief explanation of the causes of economic welfare. The preface to this book indicates Cannan's view of economics:

"The really fundamental questions of economics are why all of us, taken together, are as well off – or as ill off, if that way of putting it be preferred – as we are, and why some of us are much better off and others much worse off than the average."

Cannan's lectures to second and third year students were published in 1929 as A review of economic theory.

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2. Early years, 1896-1918

In 1898, the Director W A S Hewins reported on the School's progress to the government. On economics teaching Hewins remarked:

"After some experiments, the present system of classes, consisting of a description of the general structure of modern business and the general features of modern industrial and commercial organisation, the meaning and use of economic terms, the outlines of economic history, and elementary statistics, was adopted, the full course to extend over two years. On this basis a superstructure of theoretical and historical training is imposed, leading up to the final or research course."

At that stage in its history LSE students were not able to study for degrees. However this changed following the School's admittance to the University of London in 1900. As a result, in 1901 the School offered students the chance to study for a new B.Sc. (Econ.) degree - the first qualification of its type in Britain.

The School awarded its first doctorates in 1903 to two women:

  • Alice E Murray on the history of commercial and financial relations between England and Ireland

  • Amy Harrison on the history of factory legislation.

Both works were published by LSE in the long-running series, Studies in Economics and Political Science.

Other than Edwin Cannan, economists who taught at LSE before the First World War included William Acworth (railway economics), Arthur Bowley (statistics), Hugh Dalton (economics), Lawrence Dicksee (accounting and business organisation), William Cunningham (economic history), Hubert Foxwell (banking and currency) and Arthur Sargent (commerce).

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3. The Beveridge years, 1919-37

"If economics could be reduced to half a sheet of note-paper, there would be no School of Economics. You come here, you find this place, only because those who founded it believed there was a need for, and possibility of, a Science of Society. That science is hard, not easy." William Beveridge in an address to new students, 10 October 1934.

The inter-war years were a great period of change for LSE, mainly due to the influence of the School's Director, William Beveridge.

At this time the departmental structure of LSE was very loose. Beveridge noted in 1925 that the School fell into two main groups:

"One group is concerned with economic relations of men and comprises, beside the department of Economics in the narrow sense, such subjects as accounting and business organisation, banking and currency, commerce and industry, and transport."

The other group was concerned with political and social relations. Beveridge states that history and statistics were common to both groups.

Edwin Cannan retired as Chair of Political Economy in 1926, a position he had held only on a part-time basis. One of Beveridge's priorities was to raise enough money for endowing a full-time Chair. He believed that, "The holder of the Chair, if he were worthy of the post, would by his situation in London occupy a very important public as well as academic position."

Fortunately funds were secured, partly from the Laura Spelman Rockefeller Memorial, and Allyn Young from Harvard was appointed in 1927. On the announcement of his appointment The Edinburgh Evening News headlines read, "American Professor for London. No suitable Englishman available." Sadly, Young died within two years. He was replaced in 1929 by Lionel Robbins, who held the Chair until 1961.

Other economists who joined the School in these years included: Roy George Douglas Allen, Vera Anstey, David Gawen Champernowne, Ronald Harry Coase, John Coatman, Evan Frank Mottram Durbin, Friedrich August von Hayek, John R Hicks, Nicholas Kaldor, Frank Walter Paish, Frederic Rudolph Mackley de Paula, Arnold Plant and Richard Sidney Sayers.

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4. From war to peace, 1938-1960s

On the outbreak of the Second World War the School was evacuated to Cambridge and most of the School's economists undertook war service as civil servants.

Lionel Robbins, for example, was Director of the Economic Section of the War Cabinet, 1941-45 (along with future LSE academics Ely Devons and James Meade). He was also one of the leading British delegates at Bretton Woods (1944) and he was involved in the negotiations for an American loan to Britain (1945). This use by governments of economists as economic advisers continued after the war.

LSE returned to its premises in October 1945 and following an initial reconstruction period it soon started to expand again. By the late 1950s, the School had over 4000 students (of whom 2500 were regular, full-time students). Its size meant that formal recognition of the academic departments within the School was necessary. So, in the early ‘60s the School was divided into fourteen departments, each with its own Convenor:

Accounting; Economic History; Economics; Geography; Government; International History; International Relations; Law; Modern Languages; Philosophy, Logic and Scientific Method; Social Anthropology; Social Science and Administration; Sociology; Statistics.

A report on the Economics Department in October 1965 indicates that it had 47 academic staff (out of about 300 in the School as a whole):

  • 10 Professors - P T Bauer, E H Phelps Brown, A C L Day, E Devons, A W H Phillips, Lord Robbins (part time), J D Sargan, R S Sayers, P Wiles and B S Yamey

  • 7 Readers

  • 5 Senior Lecturers

  • 19 Lecturers

  • 5 Assistant Lecturers

  • 1 Honorary Lecturer (Professor Sir Ronald Edwards).

Other economists who joined the School, 1938-69, included: William Moore (Terence) Gorman, Harry Johnson, Arthur Lewis, James Meade, Dennis Holme Robertson and Alan Walters.

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5. Convenors and Heads of Department

The departmental structure of the School was quite loose until 1962, when each department was required to appoint a convenor to act as "head of department", usually for three academic years. The following is a list of convenors for the Economics Department, 1962-present:


Professor Ely Devons (1913-67)

(June 1964-January 1965, Professor Phelps Brown)


Professor Basil S Yamey


Professor John Denis Sargan (1924-96)


Professor Alan C L Day


Professor Alan Richmond Prest (1919-84)


Professor Peter Thomas Bauer (1915-2002)


Professor Hla Myint (1920-89)


Professor Richard Layard


Professor Meghnad J Desai


Professor Charles A E Goodhart


Professor Kevin W S Roberts


Professor Christopher A Pissarides


Professor Charles R Bean


Professor Richard Jackman


Professor John Sutton


Professor Danny Quah


Professor Alan Manning


Professor Michele Piccione

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Previous exhibitions

Current exhibition

  • World War One @ LSE

    WW1 @ LSE: a common cause

    WW1 @ LSE: a common cause draws on the Library's collections to feature a selection of digital images related to the First World War.