Tuesday, December 11, 2012

Remembering Albert Hirschman

Albert Hirschman, among cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 greatest of social scientists, has died. He was truly one of a kind: always trespassing, relentlessly self-subversive, and never constrained by disciplinary boundaries.

Hirschman's life was as extraordinary as his work. Born in Berlin in 1915, he was educated in French and German. He would later gain fluency in Italian, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365n Spanish and English. He fled Berlin for Paris in 1933, and joined cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 French resistance in 1939. Fearful of being shot as a traitor by advancing German forces, he took on a new identity as a Frenchman, Albert Hermant. In 1941 he migrated to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 United States, met and married Sarah Hirschman, joined cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 US Army, and soon found himself back in Europe as part of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 war effort. After cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 end of hostilities he was involved in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 development of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Marshall Plan, and subsequently spent four years in Bogotá where many of his ideas on economic development took shape. He and Sarah were married for more than seven decades; she died in January of this year.

Not only did Hirschman write several brilliant books in what was his fourth or fifth language, he also entertained himself with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 invention of palindromes. Many of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365se were collected togecá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r in a book, Senile Lines by Dr. Awkward, which he presented to his daughter Katya. Forms of expression mattered to him as much as cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ideas cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365mselves. In opposition to Mancur Olson, he believed that collective action was an activity that came naturally to us humans, and was thrilled to find that one could invert a phrase in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 declaration of independence to express this inclination as "cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 happiness of pursuit."

Hirschman's intellectual contributions were varied and many but cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 jewel in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 crown is his masterpiece Exit, Voice and Loyalty. In this one slim volume, he managed to overturn conventional wisdom on one issue after anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r, and chart several new directions for research. The book is concerned with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 mechanisms that can arrest and reverse declines in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 performance of firms, organizations, and states. It was cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 interplay of two such mechanisms - desertion and articulation, or exit and voice - which Hirschman considered to be of central importance.

Exit, for instance through cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 departure of customers or employees or citizens in favor of a rival, can alert an organization to its own decline and set in motion corrective measures. But so can voice, or cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 articulation of discontent. Too rapid a rate of exit can undermine voice and result in organizational collapse instead of recovery. But a complete inability to exit can make voice futile, and poor performance can continue indefinitely.

Poorly functioning organizations prefer that an exit option be available to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir most strident critics, so that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y are left with less demanding customers or members or citizens. Hence a moderate amount of exit can result in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 worst of all worlds, "an oppression of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 weak by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 incompetent and an exploitation of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 poor by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 lazy which is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 more durable and stifling as it is both unambitious and escapable." Near-monopolies with exit options for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 most severely discontented can cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365refore function more poorly than complete monopolies. It is not surprising that many dysfunctional states welcome cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 voluntary exile of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir fiercest internal critics.

The propensity to exit is itself determined by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 extent of loyalty to a firm or state. Loyalty slows down cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rate of exit and can allow an organization time to recover from lapses in performance. But blind loyalty, which stifles voice even as it prevents exit, can allow poor performance to persist. It is in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 interest of organizations to promote loyalty and raise cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 "price of exit", but cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 short term gains from doing so can lead to eventual collapse as both mechanisms for recuperation are weakened.

Among Hirschman's many targets were cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Downsian model of political competition and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Median Voter Theorem. Since he considered collective action to be an expression of voice, readily adopted in response to dissatisfaction, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re was no such thing as a "captive voter." Those on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 fringes of a political party could not be taken for granted simply because cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y had no exit option: cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 inability to exit  just strengcá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ned cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir inclination to exercise voice. This cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y would do with relish, driving parties away from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 median voter, as political leaders trade-off cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 fear of exit by moderates against cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 threat of voice by extremists.

Albert Hirschman lived a long and eventful life and was a joyfully iconoclastic thinker. His books will be read by generations to come. But he will always remain something of an outsider in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 profession; his ideas are just too broad and interdisciplinary to find neat expression in models and textbooks. He was an intellectual rebel throughout his life, and it is only fitting that he remain so in perpetuity. 

8 comments:

  1. I don't understand why economist would view self subversive as a *good* thing - I mean, why is it good if much of your earlier work is wrong ?
    That is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 difference between science (physics, chemistry, genetics) and argumentation (english lit)

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  2. Most orthodox economists, especially those who view cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 discipline as a science, would probably not view self-subversion as a good thing. But Hirschman denied cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 existence of universal economic laws:

    "I know well that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 social world is most variable, in continuous change, that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re are no permanent laws. Unexpected events constantly happen, new causality relations are being installed... with age one's new ideas are predominantly those that contradict cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 old... I have always been against that methodology of certain social scientists... who study what has happened in some fifty or so countries and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365n proceed to draw deductions from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re on what is likely to happen in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 future. Of course, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y find cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365mselves without instruments in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 face of "important exceptions," such as cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 case of Hitler in Germany. This is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 reason that I have always disliked certain types of social research. I am always more interested in widening cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 area of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 possible, of what may happen, racá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r than in prediction, on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 basis of statistical reasoning, of what will actually happen. The inquiry into cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 statistical probability that certain social events will actually take place interests me little... I have always found that when something good happens, it occurs as a result of a conjunction of extraordinary circumstances."

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  3. I found "Exit, Voice and Loyalty" a very interesting book, but I did not find his argument about monopolies encouraging exit to be convincing at all. He was unable to find examples of businesses that behave in such a manner, and his example of encouraging former Presidents to leave sounds more like trying to avoid competition for political power. A contrarian cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ory with interesting implications, but doesn't seem to be borne out empirically.

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  4. There are really two points here: (i) do monopolies prefer that some of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir customers have an exit option, and (ii) do cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y perform worse when such an exit option is available? I think cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 second question is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 more important one, and on this point I find his examples quite compelling. He claims that a public school system will perform worse if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 most quality conscious parents can move cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir children out to private or parochial schools, and that a national railway system will perform worse if ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r transportation options (road or air) are available to some degree. Does this mean monopolies will welcome competition? Not necessarily, because too much competition will destroy cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365m. But will cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y be better able to survive despite poor performance if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re is a limited exit option for those most inclined to exercise voice? I think so.

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  5. "But will cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y be better able to survive despite poor performance if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re is a limited exit option for those most inclined to exercise voice? I think so."
    Is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re any evidence for that? The worst outcome I am aware of for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 introduction of school choice is no change. More studies that I've heard of of find that public schools improve when cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir funding starts getting diverted to students attending charter/voucher schools. I haven't heard of any studies on your transportation question.

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  6. On transportation, Hirschman cited cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 case of Nigerian railroads and competition from trucks for example (see cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 post by Justin Fox for details). On public schools, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 current system even without vouchers and charters involves a fair amount of selective exit in large cities; I would have thought that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 relevant comparison would be with a public school monopoly. It does seem that smaller towns with limited exit options have better performing public schools but cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re are too many confounding factors to draw firm conclusions. On exit from states, Alex Tabarrok cites cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 case of Cuba. Justin Fox also discusses Hirschman's example of shareholder exit displacing voice. But cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 evidence is anecdotal and historical racá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r than econometric, you are right about that. It's hard to construct proper counterfactuals for many of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365se issues.

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  7. Cuba doesn't seem that great of an example, because my understanding is that for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 longest time cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y prohibited exit. The boat lift was a one time thing, largely consisting of prisoners (who would have had fairly limited capacities for voice!). You might compare East Germany to countries furcá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r behind cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Iron Curtain (and/or speaking languages less common on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r side), where defection was more difficult.

    When you mentioned confounding factors and Alex Tabarrok, I thought you were going to link to his post on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 bias caused by smaller sample sizes. Larger samples are subject to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 "law of large numbers" and tend toward cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 average, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re will be more extremes in smaller samples.

    I don't think it's very common to prohibit private schooling, but in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 U.S nativists like cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Ku Klux Klan did start pushing for something like that in response to immigrants who were Catholic and/or German. That could provide a source of exogenous change, but I don't think we have access to very good data from back cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365n. Of course, it's a misconception that our public schools are especially terrible. If you exclude non-asian minorities, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 measured performance is typically better than in western european countries.

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