✍ Scribed by Peter Lawrence; John Loxley
No coin nor oath required. For personal study only.
Walter Newlyn, who died on October 4th 2002, was one of the UK's leading figures in international development. He helped found the Development Studies Association in 1977 and was its first President. He joined the University of Leeds in 1948 immediately after graduating from LSE, and held the chair of development economics there from 1967 to 1978.
The bare bones of Newlyn's biography hide an extraordinary and rich life history. Walter was born in 1915, left school without any formal qualifications and went to work for a grain shipping firm in the City as an office boy. His interest in economics was aroused by a visit to a Welsh coal mine in the 1930s, but war intervened and, after being evacuated from Dunkirk, he was posted to India. LSE admitted him to read economics in 1945, in spite of his lack of formal qualifications. He was a fellow student of Bill Phillips and together they built the famous hydraulic model of the circular flow of money.
Walter is internationally known for his textbook Theory of Money (1961), which was translated into several languages and is still to be found on money and banking course reading lists around the world. (The Emmet cartoon in Punch, which immortalised the Phillips-Newlyn machine, can be found in the 1971 edition of this book.) The book made a major impact on the literature on money. Described in an Economic Journal review as 'a rigorous and elegant statement of the theory of money' and 'original and stimulating' in its presentation, it was given serious academic consideration by no lesser authorities than Milton Friedman and Anna Schwarz in an article in the Journal of Money Credit and Banking. They recognized the originality of Walter's work in the book (and subsequently in an article in the Economic Journal) on the definition of what constituted money, and especially in the distinction between money as an asset and as a medium of exchange. They disputed Walter's 'neutrality criterion' for identifying money as a medium of exchange (another original contribution to the theory of money) and this led to a debate in which Walter showed that their objections to his work were incorrect.
Before then, Walter had co-authored, with David Rowan, the seminal Money and Banking in British Colonial Africa, published in 1954. Not only does this book give a detailed account of the colonial money and banking systems, but its recommendations for change are governed by a recognition that economic analysis has to be complemented with political, sociological, anthropological and historical analyses of individual and institutional behaviour. They recognized the importance of informal relationships between African entrepreneurs and financial institutions. They drew attention to the dependent character of the African colonial economies and the resentment engendered by dependence on trade with the rest of the world and especially with the UK, and the vulnerability of these economies to world trading conditions. In these areas, as in many others, their work anticipated much that is now conventional wisdom in the development literature.
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