International Finance Section, The,

International Finance Section, The, which is associated with the Department of Economics, was established in 1929 to provide research as well as research training in a field of increasing importance in world affairs. Its first director, Edwin W. Kemmerer, had been chairman of commissions to stabilize the finances of ten countries on five continents. He had noticed a scarcity of qualified specialists and found that Princeton was singularly well equipped to train the needed experts.

The section was funded chiefly by a gift of $490,000 from Gerard B. Lambert '08 and his family in memory of James Theodore Walker '27, who died in an airplane accident two days after his graduation. Additional gifts, including $20,000 from Kemmerer himself, together with funds transferred from general endowment, gave the Walker Foundation of International Finance a value of $690,000 in 1930. Its income has financed the section and the Walker Professorship of Economics and International Finance.

During the early years Frank Dunstan Graham, Frank Whitson Fetter, and Charles Ray Whittlesey were associated with Kemmerer, who was both Walker Professor and director of the section. After Kemmerer's death in 1945, Graham became Walker Professor. In 1949, Gardner Patterson was brought in to direct the section; associated with him in its research were Friedrich A. Lutz, and Jacob Viner, who on Graham's death in 1949, became Walker Professor.

Patterson relinquished the directorship in 1958, and Viner retired as Walker Professor in 1960. Thereupon, the two positions were reunited: Fritz Machlup was called from Johns Hopkins to serve in both capacities. On Machlup's retirement in 1971, Peter B. Kenen, called from Columbia, assumed both positions.

The major achievements of the section are threefold: (1) research and research training, (2) publications of singular importance and timeliness, and (3) organization of conferences with great influence on governmental and intergovernmental policies. The research findings of the directors and associates of the section have been published in five different series of essays, papers, and studies, as well as in scores of books and articles. Probably no other single source of knowledge on international financial affairs has been more extensively used and cited by scholars and writers in this field than the publications of the section.

The usefulness of the conferences is demonstrated by the number of top officials of national governments and international organizations who participate. The ``Joint Conference of Officials and Academics on International Monetary Reform,'' first convened in Bellagio, Italy, and widely known as the Bellagio Group, met eighteen times between 1964 and 1977, in Bellagio, Washington, and Princeton, as well as in eight other European centers. Another series of conferences, held in Brgenstock, Switzerland, which became known as the Brgenstock Group, included also practitioners from the private sector~ -- executives of commercial banks and multinational corporations. Both types of conferences have been credited with having had a wholesome influence on international negotiations in monetary affairs.

Fritz Machlup

From Alexander Leitch, A Princeton Companion, copyright Princeton University Press (1978).

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