The best biographies of late 20th century economists

Since the global financial crisis of 2007-8, everyone knows about the transformation of financial markets that has taken place in recent decades. It also well known that developments in information technology have played a major role in that transformation. What is less well known is where the ideas that made it all possible came from. In this book, Perry Mehrling tells the story of Fischer Black, one of the creators of the Black-Scholes formula for pricing options (rights to buy or sell assets at a specified price at some point in the future) which are one of the foundations on which modern finance rests. The book shows how these ideas emerged out of a new type of community that spanned university economics departments and business schools as well private-sector financial firms, many of them founded in order to trade on the basis of the theories their founders had developed.

In the 1950s and 1960s, J. K. Galbraith was probably America’s most famous economist. A Canadian, whose career began as an agricultural economist, Galbraith achieved notoriety in the United States as Director of the wartime Office of Price Administration, until he was forced to resign. He was one of the economists responsible for spreading Keynesian ideas in America, and became active in the Democratic Party, and a close friend and adviser to President John F. Kennedy. He was the author of a string of best-sellers: American Capitalism, The Great Crash:1929, The Affluent Society, and The New Industrial State, as well as a talented essayist and speech-writer, coining phrases that have become well known, including “the conventional wisdom” and “private wealth and public squalor.” Holding radical political views, he became an outsider to an economics profession that increasingly turned away from his non-technical literary style. Parker has written the definitive biography of an economist whose influence was greater outside the field of economics than within it.

I have picked this book because it tells a story that should interest anyone even if they have no interest in technical economics. Albert Hirschman was born into a Jewish family in Berlin and in his teens became politically committed as a socialist, at a time when the rise of the Nazi party made this a dangerous activity. The book tells the story of his exploits in Germany and occupied Europe before he ended up in the United States, where he made his career as a specialist on economic development, spending a significant part of his life advising the government of Colombia.

Hopefully, the book gives an account of Hirschman’s economic ideas in a way that will make sense even to readers who don’t know any economics, but even without that, it is a sufficiently gripping story of the life of an exile from inter-war Germany who ended up as a prominent development economist.

Lionel Robbins was very important in twentieth-century British economics, primarily because he was a key figure at the London School of Economics, which by mid-century came to dominate the field. Susan Howson tells the story of his life, from his birth on a farm just outside London, through his military service in the First World War to his career as an economist. His views brought him into conflict with Keynes over how government should (or should not) take action to cure the Great Depression, and he was responsible for bringing the Austrian economist, Friedrich Hayek, to London. In the Second World War, he worked alongside Keynes in what later became the Government Economic Service. However, he was much more than an economist and after the war he became a major public figure, important for the arts and laying out a blueprint for the development of British higher education. It is a big book but that is because there are so many sides to Robbins’s activities.

Joan Robinson is widely considered to be the woman who should have received the Nobel Memorial Prize in economics but never did. This book is the story about how she managed to forge a career as an economic theorist, at a time when such a career path was unusual, in the misogynistic environment of Cambridge. Not only did she succeed in writing a book that arguably changed the way firms and markets were analysed, but she also became involved in the Keynesian revolution. Her career did not just happen: it needed to be promoted and for that strategy was important. Aslanbegui and Oakes focus on the interpersonal interactions through which her career developed taking the story up to the outbreak of the Second World War, by which time she was established as one of the most distinguished economists at Cambridge.