Institute of Economic Affairs

The Institute of Economic Affairs (IEA) is a British right-wing free market think tank, which is registered as a charity. Associated with the New Right, the IEA says that it seeks to "further the dissemination of free-market thinking" by "analysing and expounding the role of markets in solving economic and social problems".

Founded by businessman Antony Fisher in 1955, the IEA was one of the first modern think tanks, and promoted Thatcherite ideology, and free market and monetarist economic policies. It published climate change denial material throughout the 1990s and 2000s. It has advocated for privatisation of, and abolition of complete government control of, the National Health Service (NHS), in favour of a healthcare system with market mechanisms. In 2018 the director of the IEA met with foreign donors and offered to arrange access to government ministers in return for financial contributions. This initiated an investigation by the UK charity regulator, the Charity Commission, as to whether the group had failed to uphold its legal obligations. Following complaints of the IEA's conduct by cross-party politicians in 2024, the Charity Commission opened a compliance case into the IEA in May 2025.

The IEA is headquartered in Westminster, London. It subscribes to a neoliberal world view and advocates positions based on this ideology. The IEA has been criticised for operating in a manner closer to that of a lobbying operation than as a genuine think tank, and for receiving some funding from tobacco companies whilst campaigning on tobacco industry issues.

In 1945 Antony Fisher read an article in Reader's Digest by Friedrich Hayek that summarised Hayek's work The Road to Serfdom. Later that year, Fisher visited Hayek at the London School of Economics. Hayek dissuaded Fisher from embarking on a political and parliamentary career to try to prevent the spread of socialism and central planning. Instead, Hayek suggested the establishment of a body that could engage in research and reach the intellectuals with reasoned argument, saying that a think tank would have far more "decisive influence in the great battle of ideas". Set up by Fisher and Oliver Smedley, the IEA was thus founded after Hayek had suggested that an intellectual counterweight through think tanks was necessary to combat the prevailing post-war consensus around Keynesianism and the Butskellism of Rab Butler and Hugh Gaitskell. Fisher, Smedley, and others were successful in building the IEA and its affiliates of Atlas Network into a bastion of free-market economics and neoliberalism, which supplanted the post-war Keynesian paradigm.

The IEA's first location was a cramped, £3-a-week room with one table and chair at Oliver Smedley's General Management Services, which housed various free-trade organisations at 4 Austin Friars, a few dozen yards from the Stock Exchange in the heart of the City of London. In June 1955, The Free Convertibility of Sterling by George Winder was published, with Fisher signing the foreword as Director of the IEA. In November 1955 the IEA's Original Trust Deed was signed by Fisher, Smedley, and John Harding. Ralph Harris (later Lord Harris) began work as part-time General Director in January 1957. He was joined in 1958 by Arthur Seldon who was initially appointed Editorial Advisor and became the editorial director in 1959. Smedley wrote to Fisher that it was "imperative that we should give no indication in our literature that we are working to educate the public along certain lines which might be interpreted as having a political bias. ... That is why the first draft [of the IEA's aims] is written in rather cagey terms".

The Social Affairs Unit was established in December 1980 as an offshoot of the Institute of Economic Affairs to carry the IEA's economic ideas onto the battleground of sociology. "Within a few years the Social Affairs Unit became independent from the IEA, acquiring its own premises." In 1986 the IEA created a Health and Welfare Unit to focus on these aspects of social policy. Discussing the IEA's increasing influence under the Conservative government in the 1980s in relation to the "advent of Thatcherism" and the privatisation of public services, Dieter Plehwe, a Research Fellow at the WZB Berlin Social Science Center, has written that "[t]he arguably most influential think tank in British history ... benefited from the close alignment of IEA's neoliberal agenda with corporate interests and the priorities of the Thatcher government.

During the 1990s the IEA began to focus its research on the effects of regulation, and began a student outreach programme. Free-market publications continued to be the core activity of the IEA. Oliver Letwin said of the organisation in 1994: "without the IEA and its clones, no Thatcher and quite possibly no Reagan; without Reagan, no Star Wars; without Star Wars, no economic collapse of the Soviet Union. Quite a chain of consequences for a chicken farmer!" In 2007 British journalist Andrew Marr called the IEA "undoubtedly the most influential think tank in modern British history". Damien Cahill, a professor of Political Economy at the University of Sydney, has characterised the IEA as, "Britain's oldest and leading neoliberal think tank". In October 2009 the IEA appointed Mark Littlewood as its Director General, with effect from 1 December 2009. In September 2022 an associated think tank, the Free Market Forum, was founded. In December 2023 Mark Littlewood stood down as the IEA's Director General and was replaced by Tom Clougherty under the title of Executive Director.

In 2018 the IEA's then-director Mark Littlewood said "We want to totally reframe the debate about the proper role of the state and civil society in our country ... Our true mission is to change the climate of opinion." The IEA promotes the market and has two prominent themes in its publications: first, a belief in limited government and, second, "the technical (and moral) superiority of markets and competitive pricing in the allocation of scarce resources."