At the London School of Economics, a few weeks before Christmas, in 1949, the Lionel Robbins seminar was about to begin. The prestigious event was at the razor’s edge of postwar economic thought: Robbins, a giant of economics, had made the LSE a rival to John Maynard Keynes’s Cambridge, recruiting future Nobel laureates such as Friedrich Hayek, John Hicks, Arthur Lewis and the classicist turned economist James Meade.
This lecture, however, promised to be more of a curiosity than a masterclass. Meade had persuaded Robbins to invite an unlikely speaker: a small, shy, incessantly smoking mature student from New Zealand, who had just failed in his attempt to get a degree in sociology. Meade’s protégé had brought an extraordinary device with him — a Heath Robinson-esque contraption resembling an adventure playground for non-existent fish. Half a dozen or more Perspex tanks were linked together through a network of pipes, dams and sluice gates and filled with water stained a deep pink with cochineal dye. It looked like the sort of thing a mad genius might produce if asked to design a water clock. What it could have to do with economics was anyone’s guess. But curiosity is a powerful thing, and many of the School’s finest economists were there to gawp at what promised to be an outlandish display.
The subject of this sudden attention, Alban William Phillips, had been born on a dairy farm in Te Rehunga in rural New Zealand 35 years earlier. His father, Harold, had equipped the farm with a flush toilet, a generator powered by a waterwheel, and electric light, long before the neighbouring farms had any such wonders. As a result, Bill Phillips and his siblings were able to read late into the night — or at least until Harold called “lights out”, and inserted a lever into a winch in the bedroom, which pulled a wire, which pulled a chain, which, far across the farmyard, disconnected the wheel from the generator and plunged the bedroom into darkness.