The eminent British economist James Meade (1907–95), winner of a Nobel Memorial Prize in Economic Sciences in 1977, often described himself as a Utopian economist and, in his Cambridge years from 1957 onwards, an ivory tower economist. Yet his practical achievements include the creation of the first official national income accounts in 1940–41, the preparation of the first memoranda that resulted in the British government’s White Paper on Employment Policy in 1944, the first proposal for an ‘International Commercial Union’ in 1942 – and hence a ‘founding father’ of the 1947 General Agreement on Tariffs and Trade – the drafter of the employment clauses in the 1948 Charter for an International Trade Organization approved at the United Nations Conference on Trade and Employment in Havana, Cuba, in 1948 and of the International Wheat Agreement in force from 1949 until the 1980s, and two ‘Meade Reports’ The Economic and Social Structure of Mauritius to the Governor of Mauritius (1961b) and The Structure and Reform of Direct Taxation for the Institute for Fiscal Studies (IFS) (1978a).
But, apart from perhaps the national income estimates where his collaborator was Richard Stone, he is remembered more for his academic work – from his role in the ‘Cambridge Circus’ group of young economists who met in 1930–31 to criticize John Maynard Keynes’s A Treatise on Money (1930) and thus set Keynes on the path to his General Theory of Employment, Interest and Money (1936), to the first Keynesian textbook in economics (An Introduction to Economic Analysis and Policy (1936a)), his contribution to the enquiries of the Oxford Economists Research Group in 1936–37, his 1950s work on the theory of international economic policy (for which he received the 1977 Nobel Prize jointly with Bertil Ohlin), and on customs unions – to the long series of academic articles and 30 books. My intention in this biography is to tell the story of his involvement in policymaking as well as to describe the development of his more theoretical work in economics.
His most decisive influence on economic policy came when he was working for the British government during and after the Second World War, first under Winston Churchill’s wartime coalition as a temporary wartime civil servant in what became the Economic Section of the Cabinet Offices and then from November 1944 as a permanent official, succeeding Lionel Robbins as the director of the Section on 1 January 1946 and serving the first majority Labour government under Clement Attlee until he resigned in frustration (and ill health) in 1947. That service was preceded by two and a half years (1937–40) at the headquarters of the League of Nations in Geneva, where he was the editor of two of the League’s annual World Economic Surveys.
His academic career comprised a fellowship at Hertford College Oxford 1930–44, Chair of Commerce with special reference to international trade at the London School of Economics (LSE) 1947–57, the Cambridge Chair of Political Economy 1957–68 and a Nuffield Foundation senior research fellowship 1968–74; from 1957 he was also a fellow of Christ’s College Cambridge. His theoretical work was in many fields of economics: macroeconomics and monetary economics, international finance and international trade, price theory, national income accounting, nationalization and planning, externalities, population problems and economic development, public finance, welfare economics, growth theory, income and wealth distribution and inequality, wage determination, labour-managed firms and the share economy. As he began his LSE inaugural lecture in 1948, his ‘main concern’ was ‘theoretical analysis and … the contribution which economic analysis has to make to the solution of problems of practical economic policy’.
He had begun to advise the Labour Party on economic policy in the 1930s and it was in that connection that he first wrote on the ‘economics of Utopia’. Utopia (Greek for ‘no place’; it is also a pun on ‘eutopia’, a ‘happy’ or ‘fortunate’ place) was the invention of the English lawyer, author and public servant, Thomas More (1478–1535). More wrote (in Latin) his ‘elusive work of fiction’ Utopia (1515) when he was ‘accustoming himself to the prospect of entering royal service’ under King Henry VIII (as he did in 1518). ‘He knew … that princes were not inclined to listen. But he accepted the duty to sacrifice private liberty for the public good … Utopia was written and published for those who advised princes. … He hoped that by presenting an ideal, and confronting this ideal with lamentable reality, reform might be generated’ (Brigden Reference Brigden2001, 3–4). In the story ‘Morus’ debates with a philosopher, Raphael Hythloday, who has travelled with Amerigo Vespucci to the New World and discovered the fictional island of Utopia: there he found ‘the best state of the commonwealth’. There the Utopians had abolished private property and held everything in common; labour was a communal, universal duty and without money or ownership everyone was rich; and they were ‘freed to concern themselves with the common good. … Their society was pacific and benevolent, tolerant and temperate’. Hythloday contrasted this with contemporary England which was neither just nor happy. At the end of the book Morus takes him to dinner and comments (More Reference More, Logan and Adams2016, 113): ‘[W]hile I can hardly agree with everything he said … , yet I freely confess that in the Utopian commonwealth there are very many features that in our own societies I would like to see.’Footnote 1
The first chapter of this book describes James’s life before Oxford – his family background, his schooling and the beginnings of his interest in economics. He was brought up in Bath, Somerset, and like others of his social class educated at a preparatory school (Lambrook) and a public (i.e. private) school (Malvern College). Although he disliked Malvern and its emphasis on sports it did foster his musical interests and he excelled in the study of Greek and Latin, gaining a scholarship to Oriel College Oxford in 1926. At Oxford he studied classical language and literature for two years before switching to the new degree Philosophy Politics and Economics (PPE). As he wrote in his own account of his life up to 1977 (Meade 1988a, 1),
Like many of my generation I considered the heavy unemployment in the United Kingdom in the inter-war period as both stupid and wicked. Moreover, I knew the cure for this evil, because I had become a disciple of the monetary crank, Major C.H. Douglas, to whose works I had been introduced by a much loved but somewhat eccentric aunt. But my shift to the serious study gradually weakened my belief in Major Douglas’s A + B theorem, which was replaced in my thought by the expression MV = PT.
On graduation in 1930 with a first-class degree, he was elected to a fellowship at Hertford College. The next three chapters describe his life at Oxford. As an undergraduate (Chapter 2) he joined the Oxford University Labour Club and several other undergraduate societies (including the ‘Thomas More Society’ for which he created and edited a magazine) and he rowed for his college; through these activities he made lifelong friends. The chapter also describes the teaching in economics he received in 1928–30. These first two chapters show how early James’s philosophical and political views were formed. His views on economic theory and policy were to be settled in his first postgraduate year in 1930–1 and by world economic events in 1931–3.
Chapter 3 covers his first three years as a fellow of Hertford College, the first of which he spent at Trinity College Cambridge as a postgraduate student in order to learn more economics before teaching it to undergraduates. At Hertford he began to give tutorials and lectures on economics and wrote his first book, The Rate of Interest in a Progressive State (1933b). He also wrote his first policy pamphlet, Public Works in Their International Aspect, which was published by the New Fabian Research Bureau (NFRB) in 1933a. James wrote of his Oxford years (1988a, 2):
My job was to teach the whole corpus of economic theory, but there were two subjects in which I was especially interested, namely the economics of mass unemployment and international economics. In the 1930s one was aware of two great evils – mass unemployment and the threat of war. I thought – and I still think – that the government of the United Kingdom could in those days have altered the course of world history by listening to Keynes on employment policy and by backing to the hilt the League of Nations for the preservation of peace.
In 1933 James married Margaret Elizabeth Wilson, the daughter of a prominent Quaker family and the secretary of the Oxford branch of the League of Nations Union (LNU, formed in 1918 to promote international justice, collective security and a permanent peace between nations based upon the ideals of the League of Nations). After their marriage (Chapter 4) he began to publish in the journals and wrote his textbook (1936), as well as serving as Bursar of his college and preparing policy papers for the Labour Party. He produced one of his most well-known articles, ‘A simplified model of Mr Keynes’s system’ (1937a), for the first European Econometric Society Conference held in Oxford in September 1936. Before he went, on leave from Hertford, to work for the League of Nations in Geneva at the end of 1937 he was an important member of the Oxford Economists Research Group and prepared its famous (and influential) report on the group’s interviews of businessmen about the effects of interest rates (Meade and Andrews 1938). He also wrote articles on international trade for the LNU Economics Committee. In his last Oxford summer he wrote a short book, Consumers’ Credits and Unemployment (1938a), advocating a ‘social dividend’ (now known as basic income), which harked back to C.H. Douglas’s ‘national dividend’ – an idea which was ‘present in his writings from the 1930s onwards as a central ingredient of a just and efficient economy’ (Van Parijs and Vanderborght Reference Van Parijs and Vanderborght2017, 81).
Chapter 5 describes the nature of his work with his colleagues for the Financial Section and Economic Intelligence Service of the League of Nations, primarily the preparation of its World Economic Surveys for 1937–38 and 1938–39 but also involvement in the discussions of Jan Tinbergen’s econometric work on business cycles and of depression policy. In the first months of the Second World War, unable to visit the USA as he had hoped, he wrote another short book, The Economic Basis of a Durable Peace (1940), already looking ahead to a postwar world.
When war broke out in September 1939, James was keen to return to England to work for the government but the family could not leave Geneva until May 1940: in their small Ford car ‘we left … with our three children, aged 4 years, 2 years and 2 weeks only to become part of the disordered refugee crowds fleeing across France from the German army. After some adventures we reached England …’. James then persuaded a very reluctant Margaret to accept the offer of some American Rhodes Scholars to accommodate children – with a few mothers – of Oxford dons in the USA for the duration.Footnote 2 In mid-June James joined the other economists in the War Cabinet Offices. There, beside ‘the day-to-day task of giving advice at a moment’s notice on any economic problem ranging from points-rationing for foodstuffs to the price policy of nationalised industries’ he had ‘three major tasks’ (1988a, 2–3):
First and foremost in 1941 Richard Stone and I prepared the first official estimates of the UK national income and expenditure … the first true double-entry social accounts prepared for any country. Second, there were the discussions and drafts leading up to the White Paper on Employment Policy of 1944, in which the UK government accepted the maintenance of employment as an obligation of governmental policy. Third, there were the discussions, state papers and conferences leading up to the post-war international settlement, namely the International Monetary Fund, the International Bank for Reconstruction and Development and the General Agreement on Tariffs and Trade. I was especially concerned with the last of these.
The first of the four wartime chapters, Chapter 6, concentrates on the origin and production of those first official national estimates, commenced during the Blitz on London when James and his sister Mary were almost immediately bombed out of her flat. As well as describing James’s wartime life in London, it covers the Economic Section’s work on points rationing for food, ‘one of [the government’s] big home front successes of the war’ (Hancock and Gowing Reference Hancock and Gowing1949, 332).
Chapter 7 is concerned with the first efforts at postwar planning of the domestic and international economies, in which the Economic Section was heavily involved. James played a crucial role, taking the lead on domestic employment policy and on international trade policy, putting forward his proposal for an ‘International Commercial Union’ in July 1942 to complement Keynes’s ‘International Currency Union’. As President of the Board of Trade, the economist and Labour MP Hugh Dalton – for whom James had written policy papers in the 1930s – seconded him part-time to his department to work on the commercial union plan. As deputy director of the Section, James, with Keynes and Robbins negotiated with William Beveridge over the cost of the proposals of his Committee on Social Insurance and Allied Services before their publication in a White Paper (Cmd 6404); James took the opportunity to produce another plan, this one for the countercyclical variation of social insurance contributions. The chapter ends with Margaret and the children’s return from the USA on a troop ship in November 1942.
Chapter 8 carries the postwar planning story into 1943, beginning with the official interdepartmental committee which considered James’s commercial union proposals. The year saw progress with respect to domestic employment policy and the first Anglo-American discussions on the postwar international order in Washington, DC, which included James as a member of the British ‘Law mission’ of September–October 1943. James also participated in the series of conferences on postwar economic matters with representatives of British Commonwealth governments, which began in London in October–November 1942, usually to explain and defend his own commercial union proposals against opposition from Dominions, especially Australian, officials. In the following eighteen months (Chapter 9), while there was little or no progress on postwar international trade policy, the UK government published its White Paper on Employment Policy (Cmd 6527) in May 1944 and the United Nations International Monetary and Finance Conference at Bretton Woods, NH, in July agreed to the creation of the IMF and the IBRD. From November 1944, the Economic Section – with James as director-designate – began to prepare to implement the White Paper policy as soon as the war was over; James also had to try to recruit economists for a postwar Economic Section.
With the election of a Labour government in July 1945, James had to concern himself with its attempts to implement Labour policy, including budgetary policy and the nationalization of major industries (Chapter 10), against the background of the protracted negotiations in Washington for a desperately needed loan from the USA. His last months in Whitehall (Chapter 11), in addition to continued concern with domestic financial policy, were almost entirely taken up with preparations for and attendance at the Commonwealth and international conferences in London and Geneva which eventually produced GATT in the summer of 1947.
When James returned to academic life in September 1947 as Professor of Commerce at LSE, he had decided on a major research project: to replace his 1936 textbook with a multi-volume treatise on economic theory and policy which would incorporate the many insights gained in his official work. ‘So, as I was appointed at the LSE to teach international economics, I started on The Theory of International Economic Policy … [which became two volumes]. These books took up practically the whole of my ten years at the LSE; but even so they did not cover the whole of the international problem … but the part which I did manage to cover was sufficient eventually for me to gain the Nobel award’ (1988a, 3). But first he used some of what he had learned in Whitehall in his first postwar book, Planning and the Price Mechanism (1948a), his contribution to current debate on economic planning. The two chapters here on those ten years are divided into Chapter 12, on life at the School and his work on the first volume, The Balance of Payments (1951a), and Chapter 13, on the development of the ideas which went into the second volume, Trade and Welfare (1955b), and his related work on the theory (and practice) of customs unions, which produced three books and several articles. He made long visits to the USA and Australia, in 1952 and 1956, both of which significantly influenced his current and his later academic work.
As Professor of Political Economy in Cambridge, he resumed his efforts to produce a multi-volume Principles of Political Economy, but that had not been completed by the time he decided to resign his chair in 1968, or even by the end of his subsequent research fellowship six years later – at which point he was asked to chair the IFS committee on tax reform. The four chapters on James’s occupancy of the Cambridge chair cover his initial experience of the Cambridge Faculty of Economics and Politics and his 1961 book on the theory of economic growth (Chapter 14); his mission to Mauritius in 1960 (Chapter 15); his extensive involvement in policy debates in the early 1960s (Chapter 16); and then (Chapter 17) his efforts as Treasurer to change the role of the Eugenics Society and some more on Faculty life before his further work in growth theory, his Wicksell Lectures on Efficiency, Equality and the Ownership of Property (1964a), and the first two volumes of his Principles of Political Economy, The Stationary Economy (1965a) and The Growing Economy (1968a).
James completed the next two volumes of his Principles (The Controlled Economy (1971a) and The Just Economy (1976)) during his Nuffield research fellowship, but he also gave several famous, important public lectures (Chapter 18). The deliberations of the Meade Committee on taxation in 1975–78, from which he said he ‘learned as much as in … three years as in any other comparable period of my life’, are the subject of Chapter 19. The chapter also describes his substitute for a fifth volume of Principles, The Intelligent Radical’s Guide to Economic Policy (1975a), his Nobel lecture and his famous Snow Lecture on ‘Stagflation’.
In the twenty years of his ‘retirement’ James led a major research project on stagflation (the coincidence of high inflation and unemployment) which produced three books. He then published three more books which he entitled, reflecting his longstanding concerns, Agathotopia: The Economics of Partnership (1989a), Liberty, Equality and Efficiency (1993a) and Full Employment Regained? (1995a). Chapter 20 describes the first stage of the stagflation project along with James’s involvement with the new Social Democratic Party (SDP); Chapter 21 is mainly concerned with the second stage of the stagflation project and his concurrent work on labour-managed firms and the share economy, but also the celebrations of Keynes’s centenary and James’s own eightieth birthday.
The final chapter concentrates on his final alternative to Utopia which he propounded in his last three books and other writings in the last years of his life. Agathotopia is a good place, not a Utopia which would require a change in human behaviour but one which would harness the best instincts of existing imperfect humans to produce a just society.
In preparing a biography of James, I am grateful first of all to Margaret, whose suggestion it was that I write one, and to the members of their family who have consistently provided encouragement and information: Margaret herself, Cherry Lewis, Bridget and Edward Dommen, and Carol and Partha Dasgupta. Margaret gave me copies of her memoirs, ‘My Life’ and ‘Part II June 1940’, long before I began to write this book; Cherry gave me typescripts of her parents’ wartime correspondence and his later letters from the USA; Carol gave me a copy of ‘JEM: My Childhood: Conversation with Carol Dasgupta (1994)’ and of James’s letters to his parents from his prep school, as well as her own memoirs (2013). I am deeply grateful to James himself for having asked me to edit his Collected Papers in 1985. Many others have shared their memories of James or provided valuable information on his life and work, including Stefan Boljevic, Alec Cairncross, Max Corden, Geoff Harcourt, Marjorie Harper, Philippe Hein, Doug Irwin, David Laidler, Michael McClure, Francine McKenzie, Don Moggridge, David Nelson, George Peden, Adrian Silcock, Geoff Whittington and Donald Winch. I particularly want to thank the Master and Fellows of Christ’s College Cambridge for welcoming me into the college – especially Frank Kelly, William Peterson, John Wilson, Cecil Courtney, Nick Gay, David Jones, Geoffrey Martin, Peter Lachmann and Julia Shvets. I am very grateful to my friend Ian Bent, who, having attended the concert of the Christ’s College Musical Society at which James sang Schumann’s Dichterliebe, obtained from his friend Peter Wright the programme and Wright’s recording of the concert, and put me in touch with James’s accompanist, David Nelson, who generously wrote up his recollections. I am also grateful for the opportunities to talk about James to the Fellows and to the Economics Society of Christ’s College in 2015 and 2016, to the annual meetings of the History of Economics Society in New York City in 2019 and of the History of Economic Thought Society of Australia in Melbourne in 2022, and to the Financial History Seminar in Cambridge in 2023. Several friends have read and commented on drafts of various chapters or papers – Bill Allen, Bradley Bateman, Selwyn Cornish, Carol and Partha Dasgupta, Bridget and Edward Dommen, Anthony Endres, Geoff Harcourt, Doug Irwin, Cherry Lewis, Francine McKenzie, Ivo Maes, Alex Millmow, David Vines, Martin Weale and Geoff Whittington. David Laidler nobly read the whole manuscript and has been the most constructive critic. I am especially grateful to Don Moggridge for asking me to join him in editing James Meade’s and Lionel Robbins’s unpublished diaries and for his support and encouragement over nearly fifty years.
The archival evidence relating to James’s life and career has been invaluable – especially, of course, his papers in the British Library of Political and Economic Science at LSE. Documents from these and other archives have been referred to by the name of the collection and file number (e.g. Meade 2/1). Files in the UK National Archives are identified by their call numbers (e.g. T 230/1). The archives consulted are listed before the published sources (referred to in the text by author and date of publication). For invaluable archival assistance, I am indebted to Sue Donnelly, Anna Towlson, Virginia MacDonald, Colin Harris, Rob Petrie, Geoffrey Martin, Julie Durrant and Amelie Roper. For permission to cite and quote from archival material, I thank the British Library of Political and Economic Science; the Bodleian Library; the Master and Fellows of Oriel College and Hertford College and the Warden and Scholars of Nuffield College, Oxford; the Master and Fellows of Christ’s College, Trinity College and Churchill College, and the Provost and Fellows of King’s College, Cambridge; Cambridge University Library; the Marshall Library of Economics; the Australian National University; the University of Melbourne; the Controller of His Majesty’s Stationery Office; the Reserve Bank of Australia; the Bank of England; League of Nations Archives; Library and Archives Canada; the Australian National Archives; the Bancroft Library, University of California at Berkeley; the Hoover Institution on War, Revolution and Peace, Stanford University; the Special Collections Research Center, University of Chicago; Princeton University Library; the Rare Book, Manuscript and Special Collections Library, Duke University; the Director of the Universitätsbibliothek Basel; the Royal Institute of International Affairs; and the family of James Meade. I must also thank Ruth Martin for making the index.
