Tag Archives: Albert Hirschman

Hirschman’s trespassing creativity

Economist Rajiv Sethi writes an appreciation of the great economist Albert Hirschman on his 96th birthday.  In The Self-Subversion of Albert Hirschman he writes:

Interesting lives make for interesting ideas, and Hirschman’s is a case in point. Born to a German family of Jewish origin in 1915, he was baptized (but never confirmed) as a Protestant. His education was in French and German, though he would later become fluent in Italian, and eventually in Spanish and English. By the age of sixteen he had joined the youth movement of the Social Democratic Party. Through his sister Ursula (who was a major influence on his life and thought) he met Eugenio Colorni, whose Berlin hotel room was used for the production of anti-fascist pamphlets and fliers. Ursula would later marry Colorni, and one of their daughters, Eva, would go on to become an economist in her own right and marry Amartya Sen. (Eva’s untimely death and her influence on Sen’s thought is acknowledged in the emotional leading footnote of this paper.)

Hirschman watched the rise of Hitler with increasing alarm, and fled Berlin for Paris alone at the age of 18 just a couple of months after the Reichstag fire. Over the course of the next few years he would live in France, England, Spain, and Italy. He spent a year at the London School of Economics in 1935-36, taking courses with Robbins and Hayek, but finding greater intellectual affinity with a younger group of economists among whom was Abba Lerner.

When war broke out in 1939 he joined the French Army and, for fear of being shot as a traitor by approaching German forces, was compelled to adopt a new identity as a Frenchman, Albert Hermant. By 1941 he had migrated to the United States, where he met and married Sarah Hirschman. (They have now been married for seventy years.) He joined the US Army in 1943, and found himself back in Italy as part of the war effort soon thereafter.

At the end of the war Hirschman returned to the US and was involved with the development of the Marshall plan. He subsequently spent four years in Bogota, first as an adviser to the government on development policy, and then as a private economic consultant. After a sequence of appointments at Yale, Stanford, Columbia and Harvard, he moved to the Institute for Advanced Study in Princeton where he and Sarah remain.

As far as methodology is concerned, Hirschman expresses “a dislike for too unilateral and uniform diagnoses,” preferring instead to imagine the unexpected:

Short Links: anthropology and loyalty

1) From Savage Minds, An interactive Anthropological theory timeline, and another, non-interactive, one.

2) Economist Rajiv Sethi reflects on Albert Hirschman‘s classic book Exit, Voice and Loyalty – I last read it over 15 years ago, Sethi’s reflection inspire me to reread it.  Sethi writes on The Astonishing Voice of Albert Hirschman:

This is a book with dozens of sparking insights tied together by a coherent vision. The vision allows for a broad range of human motivation, encompassing (but not limited to) standard hypotheses regarding rational behavior. Economic actors in Hirschman’s world shop for lower prices and higher quality, to be sure, but they also capable of making a nuisance of themselves, engaging in self-deception, and displaying fierce loyalty to organizations with which they are affiliated. This rich, complex conception of human behavior allows for a sweeping analysis that is as penetrating as it is ambitious.

Hirschman’s Rhetoric of Reaction

HirschmanOn the Ecological Economics weblog Dave Iverson reminds us of the great American economist Albert Hirschman‘s book The Rhetoric of Reaction: Perversity, Futility, Jeopardy.

Iverson writes on Hirschman’s thoughts on dialogue and democracy:

As I read it, I wondered, once again, “How many economic arguments are simply the stuff of reactionary rhetoric?” Too many, I fear.

In The Rhetoric of Reaction, Hirschman gives us three theses to ponder:

  • The Perversity Thesis: reform efforts will backfire, tending toward effects opposite those desired
  • The Futility Thesis: reform efforts are doomed to fail from the get-go
  • The Jeopardy Thesis: reform efforts will unravel earlier (better) reforms, or they will unravel the entirety of whatever system is in play…

Hirschman explains how easily both conservatives and progressives get drawn into the rhetorical standoffs, impasses really: “… To the dangers of action it is always possible to oppose the dangers of inaction. …” Here is how Hirschman frames a hypothetical point/counterpoint:

Reactionary: The contemplated action will bring disastrous consequences.

Progressive: Not to take the contemplated action will ring disastrous consequences.

Reactionary: The new reform will jeopardize the older one.

Progressive: The new and the old reforms will mutually reinforce each others.

Reactionary: The contemplated action attempts to change permanent structural characteristics ([natural] “laws”) of the social order; it is therefore bound to be wholly ineffective, futile.

Progressive; The contemplated action is backed up by powerful historical forces that are already “on the march”; opposing them would be utterly futile.

Hirschman concludes with:

Recent reflection on democracy have yielded two valuable insights …. Modern pluralistic regimes have typically come into being not because of some preexisting wide consensus on “basic values,” bur rather because various groups that had been at each others’ throats for a prolonged period had to recognize their mutual inability to achieve dominance. Tolerance and acceptance of pluralism resulted eventually from a standoff between bitterly hostile opposing groups.

This historical point of departure of democracy does not bode particularly well for the stability of these regimes. The point is immediately obvious, but it becomes even more so when it is brought into contact with the theoretical claim that a democratic regime achieves legitimacy to the extent that its decisions result from full and open deliberation among its principal groups, bodies, and representatives. Deliberation is here conceived, as an opinion-forming process: the participants should not have fully or definitively formed opinions at the outset; they are expected to engage in meaningful discussion, which means that they should be ready to modify initially held opinions in the light of arguments of other participants and also as a result of new information which becomes available in the course of the debate. …

If this is what it takes for the democratic process to become self-sustaining and to acquire long-run stability and legitimacy, then the gulf that separates such a state from democratic-pluralistic regimes as they emerge historically from strife and civil war is uncomfortably and perilously wide. A people that only yesterday was engaged in fratricidal struggles is not likely to settle down overnight to those constructive give-and-take deliberations. Far more likely , there will initially be agreement to disagree, but without any attempt at melding the opposing points of view—that is indeed the nature of religious tolerance. Or, if there is discussion, it will be a typical “dialogue of the deaf”—a dialogue that will in fact long function as a prolongation of, and a substitute for, civil war. Even in the most “advanced” democracies, many debates are, to paraphrase Clausewitz, a “continuation of civil war with other means.” Such debates, with each part on the lookout for arguments that kill, are only too familiar from democratic politics as usual.

There remains then a long and difficult road to be traveled from the traditional internecine, intransigent discourse to a more “democracy-friendly” kind of dialogue. …

One question lingers with me: How far have we, particularly here in the US, backpedaled in our quest for pluralistic reasoning?

When “values” of various stripes are trotted out before us on a daily basis, asking us to pledge allegiance to ‘values’ framed as ‘moral absolutes’ in-ever-more-strident urgings, why are we not in the streets screaming, Stop! We are losing the very platform on which democracy can flourish!

Or maybe I’m just being reactionary?

Economic Understanding

Foreign Policy magazine has brief editorial essay Economist Class by Moisés Naím on the state of current economics.

A survey published in the Journal of Economic Perspectives found that 77 percent of the doctoral candidates in the leading departments in the United States believe that “economics is the most scientific of the social sciences.” It turns out, however, that this certitude does not stem from how well they regard their own discipline but rather from their contempt for the other social sciences. Although they were nearly unanimous about the relative superiority of their profession, only 9 percent of the respondents were convinced that economists agree on fundamental issues.

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