Role of London School of Economics in Indian History

The London School of Economics is not merely a congested cluster of buildings in the heart of London. It has also produced leaders who have gone on to shape the lives of millions of people.

When India became independent, the LSE-educated Bhimrao Ambedkar wrote India’s constitution and later went on to champion the rights of untouchables. His bronze bust stands at the entrance of Clement House at LSE. Another figure from LSE who made a deep impact on post-partitioned India was Sardar Tarlok Singh. He was the Director General of Rehabilitation in the Punjab responsible for the resettlement of over ten million refugees. Making two key innovations, he made the biggest refugee resettlement operation a resounding success.

India’s first Prime Minister, Jawaharlal Nehru chose Krishna Menon (from LSE) as a key advisor and India’s defence minister. Menon, who had earlier been India’s first Ambassador to the UK, helped shape the mindset of India that was suspicious of Pakistan but a supporter of socialism. In 1962, China’s victory in a war against an ill-prepared India forced Menon to resign.

Stepping into her father’s shoes in 1966, Indira Gandhi chose P.N. Haksar (also from the LSE) as her Chief Advisor. Haksar had earlier interned with Menon in London.

In an obituary to Menon, P.N. Haksar described how he met Krishna Menon:

I can recall in all its detail the day I met him. I recall the year. It was 1937. The month was November. It was lunch time. I was stepping out of London School of Economics. Next door to it, in the Houghton Street where the School was situated, was a small cafe run by a cheerful Italian. As I was turning towards it. I met Feroze Gandhi (also at the LSE who went on to marry Indira Gandhi). Feroze and I walked into Aldwych past a group of buildings called the Bush House, then on to the Strand, up a flight of dark stairs, we entered a room. There for the first time I saw Krishna Menon.

Under Haksar's strategy, Indira moved sharply to the left. She became the icon of hundreds of millions of India's poor, by adopting socialist economic policies. She eliminated the allocations to India's ex-royalty and nationalized the banking system. Haksar also sought to boost India’s military forces, which helped India win the war against Pakistan in 1971. Her landslide victory soon after was accredited to Haksar’s political and military strategy.

In recent years, India has had KR Narayanan as President in the 1990’s, who happened to study to LSE. IG Patel, ex-Governor of India’s Central Bank served as the Director of LSE from 1984-90. The IG Patel Chair was established in his honour at the LSE last year. In 1998, Amartya Sen was awarded the Nobel Prize in Economics for his work in Development economics, much of which was done as a teacher at the LSE. The influence does not stop here. Many of the world's leading economists working on India are here at LSE, notably, Maitreesh Ghatak, Tim Besley, Robin Burgess, Lords Stern and Desai and several graduate students.

If a country’s history is decided by the institutions its policy makers went to, LSE can rightfully claim to have had the biggest hand in shaping modern India. 

The Big G-School Puzzles

1. Why do poor students in government schools undertake extra tuitions costing 12 times more than the government school fees?
• Bad teaching: Teaching in government schools is only to the level required for answering questions in the exam, and not catered to applying concepts.
• Peer pressure: Children see other students doing better than them (who take tuitions) and make the causal inference that tuitions = better marks.
• Parental conscience: “If Sharma ji’s son is taking tuitions, we should also send our son. We can compromise on our living expenses but not our son’s education. Even though we are not educated, we cannot deprive our son of a good education.” [Note: the gender preference in the above statement is intentional.]
• Tuition teachers work harder: As they are paid on an hour basis, they have a greater incentive to put in more effort. The market is competitive as there are a large number of teachers who can provide tuitions.
• Job prospect theory: If a child goes for tuitions, he will get better marks, which will get him to a good college, which will get him a good job.

2. Why do government colleges have a better environment than government schools?
• Motivated students: As there is a cutoff for entry even in government colleges, above average students self-select themselves into government colleges.
• Better teachers: The teachers are paid more and thus better skilled teachers are chosen for college teaching.
• Higher fees: Colleges are not as subsidized as primary schools, so there is a greater incentive to provide better quality because it is charging the students.
• Age: As children mature, they become more subdued (and have a better understanding of complex concepts).
• The good trap: If students understand better, teachers are more effective and this increases the students’ level of understanding leading to a self-reinforcing mechanism.


3. Why do we have “bad teaching” in government schools?
• Self-selection: Bad (under-skilled, under-motivated and over-weight) teachers self-select themselves into positions that require less effort per hour and there is less chance of them getting fired.
• No explicit goals: There are no set goals and often teaching is only to cater to the exams rather than making students better at applying concepts or exploring creative answers.
• Tuition disadvantage: Teachers know that students are going to take tuitions, so why bother? This in turn, leads to more tuition.
• No feedback: Students hardly ever give feedback. They are often shy or instead, they fear retribution if the feedback is not kept anonymous. They are required to uphold teachers as gods and listen to every word without ever questioning them. This leads to moral-hazard (hidden action) for teachers.
• No top-down sticks: The principals of the schools do not care about the quality of teaching as they too have no incentive to monitor classes. There are no explicit goals (except in some cases, marks obtained) which can be addressed to by the teachers by awarding marks copiously.

4. Why do religious schools tend to do “better” than government schools?
• Discipline: Religious schools enforce discipline in code of conduct which regulates the students and makes them fulfill their daily commitments.
• Intrinsic motivation: These schools are often run by people who do not have a monetary goal in mind, but are driven by their passion to instill a value-based education in students (the value being correlated with the religion they represent).
• Self-selection: These students are often brought up in a religious environment at home too. Religious environments at home are arguably correlated with less deviance, less domestic violence, more discipline and less junk food and less idiot box watching (which reinforces their faith).
• Similar preferences: Peers are more often than not of the same religion and the same sex. This leads to a greater social capital and trust and more productivity or greater retribution if one is deviant.
• External support: These schools get a great deal of funding from religious organizations that have a stake in the system and are driven by their zeal to instill their values in the youth.

5. Why do students in government schools lack fluency in English or knowledge about current affairs?
• Teachers’ ability: The government school teachers are on average worse in spoken English and general knowledge.
• Family income: As I observed in our interviews with children who had applied for scholarship, family income is a strong predictor of English fluency of the child. On the other hand, parents may have lower earning potential because they are not good at English. This also leads to a “Bad English trap”.
• Exposure to people who speak better: Low exposure to English-speaking students, teachers, and parents’ social network lowers the bar and makes children end up like those whom they have coffee with (in this case mid-day meals).
• No exam: There are no exams on verbal ability and current affairs in government schools and so no immediate incentive for students.
• Infrastructure and technology utilization: Libraries have locked shelves. Librarians are bored individuals who only care about books not being stolen. The perceived marginal benefit from reading an Enid Blyton or a J.K. Rowling is cipher. There is hardly any hands-on experience to prepare students for the ever innovating tech-world (internet, email, google, video chat, Powerpoints, Windows, etc.).