Albert O. Hirschman

Albert Otto Hirschman (born Otto-Albert Hirschmann; April 7, 1915 – December 10, 2012) was an influential economist and the author of several books on political economy and political ideology. His first major contribution was in the area of development economics.^[1] Here he emphasized the need for unbalanced growth. Because developing countries are short of decision making skills, he argued that disequilibria should be encouraged to stimulate growth and help mobilize resources. Key to this was encouraging industries with a large number of linkages to other firms.

His later work was in political economy and there he advanced two simple but intellectually powerful schemata. The first describes the three basic possible responses to decline in firms or polities: Exit, Voice, and Loyalty. The second describes the basic arguments made by conservatives: perversity, futility and jeopardy, in The Rhetoric of Reaction.

In World War II, he played a key role in rescuing refugees in occupied France.

Life

Otto Albert Hirschmann was born in Berlin, Germany, the son of Carl and Hedwig Marcuse Hirschmann, and brother of Ursula Hirschmann.^[2] After he had started studying in 1932 at Friedrich-Wilhelms-Universität, he was educated at the Sorbonne, the London School of Economics and the University of Trieste, from which he received his doctorate in economics in 1938.^[2]

Soon thereafter, Hirschman volunteered to fight on behalf of the Spanish Republic in the Spanish Civil War. After France surrendered to the Nazis, he worked with Varian Fry to help many of Europe's leading artists and intellectuals to escape to the United States; Hirschman helped to lead them from occupied France to Spain through paths in the Pyrenees Mountains and then to Portugal.

A Rockefeller Fellow at the University of California, Berkeley (1941–1943), he served in the United States Army (1943–1946) where he worked in the Office of Strategic Services,^[3] was appointed Chief of the Western European and British Commonwealth Section of the Federal Reserve Board (1946–1952), served as a financial advisor to the National Planning Board of Colombia (1952–1954) and then became a private economic counselor in Bogotá (1954–1956).

Following that he held a succession of academic appointments in economics at Yale University (1956–1958), Columbia University (1958–1964), Harvard University (1964–1974) and the Institute for Advanced Study (1974–2012).

Hirschman helped develop the Hiding hand principle in his 1967 essay 'The principle of the hiding hand'.

In 2001, Hirschman was named among the top 100 American intellectuals, as measured by academic citations, in Richard Posner's book, Public Intellectuals: A Study of Decline.^[4]

In 2003, he won the Benjamin E. Lippincott Award from the American Political Science Association to recognize a work of exceptional quality by a living political theorist for his book The Passions and the Interests: Political Arguments for Capitalism before Its Triumph.

In 2007, the Social Science Research Council established an annual prize in honor of Hirschman.^[5]

He died at the age of 97 on December 10, 2012, some months after the passing of his wife of over seventy years, Sarah Hirschman (née Chapro).^[6]

The Passions and the Interests

This is a history of the ideas laying the intellectual groundwork for capitalism. Hirschman describes how thinkers in the seventeenth and eighteenth centuries embraced the sin of avarice as an important counterweight to humankind's destructive passions. Capitalism was promoted by thinkers including Montesquieu, Sir James Steuart, and Adam Smith as repressing the passions for "harmless" commercial activities. Hirschman noted that words including "vice" and "passion" gave way to "such bland terms" as "advantage" and "interest."

Hirschman described The Passions and the Interests as the book he most enjoyed writing. According to Hirschman biographer Jeremy Adelman, the book reflected Hirschman's political moderation, a challenge to reductive accounts of human nature by economists as a "utility-maximizing machine" as well as Marxian or communitarian "nostalgia for a world that was lost to consumer avarice."^[7]

Herfindahl-Hirschman Index

In 1945, Hirschman proposed a market concentration index which was the square root of the sum of the squares of the market share of each participant in the market.^[8] Orris C. Herfindahl proposed a similar index (but without the square root) in 1950, apparently unaware of the prior work.^[9] Thus, it is usually referred to as the Herfindahl-Hirschman index.

Books

• 1945. National Power and the Structure of Foreign Trade 1980 expanded ed., Berkeley : University of California Press^[8]
• 1955. Colombia; highlights of a developing economy. Bogotá: Banco de la Republica Press.
• 1958. The Strategy of Economic Development. New Haven, Conn.: Yale University Press. ISBN 0-300-00559-8
• 1961. Latin American issues; essays and comments New York: Twentieth Century Fund.
• 1963. Journeys toward Progress: studies of economic policy-making in Latin America. New York: Twentieth Century Fund
• 1967. Development Projects Observed. Washington, D.C.: The Brookings Institution. ISBN 0-815-73651-7 (paper).
• 1970. Exit, Voice, and Loyalty: Responses to Decline in Firms, Organizations, and States. Cambridge, MA: Harvard University Press. ISBN 0-674-27660-4 (paper).
• 1971. A bias for hope : essays on development and Latin America. New Haven: Yale University Press.
• 1977. The Passions and the Interests: Political Arguments For Capitalism Before Its Triumph. Princeton, NJ: Princeton University Press. ISBN 0-691-01598-8.
• 1980. National power and the structure of foreign trade. Berkeley: University of California Press.

• 1981. Essays in trespassing: economics to politics and beyond. Cambridge (Eng.); New York: Cambridge University Press.
• 1982. Shifting involvements: private interest and public action. Princeton, N.J.: Princeton University Press.
• 1984. Getting ahead collectively: grassroots experiences in Latin America (with photographs by Mitchell Denburg). New York: Pergamon Press
• 1985. A bias for hope: essays on development and Latin America. Boulder: Westview Press.
• 1986. Rival views of market society and other recent essays. New York: Viking.
• 1991. The Rhetoric of Reaction: Perversity, Futility, Jeopardy. Cambridge, MA: The Belknap Press of Harvard University Press. ISBN 0-674-76867-1 (cloth) and ISBN 0-674-76868-X (paper).
• 1995. A propensity to self-subversion. Cambridge, Mass.: Harvard University Press.
• 1998. Crossing boundaries: selected writings. New York: Zone Books; Cambridge, Mass.: Distributed by the MIT Press.
• 2013. Worldly Philosopher: The Odyssey of Albert O. Hirschman by Jeremy Adelman. ISBN 9780691155678. Princeton University Press. Princeton, NJ (2013)
• 2013 The Essential Hirschman edited by Jeremy Adelman (Princeton University Press) 384 pages; 16 essays

Selected articles

• "On Measures of Dispersion for a Finite Distribution." Journal of the American Statistical Association 38, no. 223 (September 1943): 346–352.
• "The Commodity Structure of World Trade." The Quarterly Journal of Economics 57, no. 4 (August 1943): 565–595.
• "Devaluation and the Trade Balance: A Note." The Review of Economics and Statistics 31, no. 1 (February 1949): 50–53.
• "Negotiations and the Issues." The Review of Economics and Statistics, 33, no. 1 (February 1951): 49–55.
• "Types of Convertibility." The Review of Economics and Statistics, 33, no. 1 (February 1951): 60–62.
• "Currency Appreciation as an Anti-Inflationary Device: Further Comment." The Quarterly Journal of Economics, 66, no. 1 (February 1952): 117–120.
• "Economic Policy in Underdeveloped Countries." Economic Development and Cultural Change, 5, no. 4 (July 1957): 362–370.
• "Investment Policies and 'Dualism' in Underdeveloped Countries." The American Economic Review 47, no. 5 (September 1957): 550–570.
• "Invitation to Theorizing about the Dollar Glut." The Review of Economics and Statistics 42, no. 1 (February 1960): 100–102.
• "The Commodity Structure of World Trade: Reply." The Quarterly Journal of Economics 75, no. 1 (February 1961): 165–166.
• "Models of Reformmongering." The Quarterly Journal of Economics 77, no. 2 (May 1963): 236–257.
• "Obstacles to Development: A Classification and a Quasi-Vanishing Act." Economic Development and Cultural Change 13, no. 4 (July 1965): 385–393.
• "The Political Economy of Import-Substituting Industrialization in Latin America." The Quarterly Journal of Economics 82, no. 1 (February 1968): 1–32.
• "Underdevelopment, Obstacles to the Perception of Change, and Leadership." Daedalus 97, no. 3 (Summer 1968): 925–937.
• "An Alternative Explanation of Contemporary Harriednes." The Quarterly Journal of Economics 87, no. 4 (November 1973): 634–637.
• "The Changing Tolerance for Income Inequality in the Course of Economic Development", World Development, Vol. 1, No. 12, (December '1973').
• "On Hegel, Imperialism, and Structural Stagnation", Journal of Development Economics,('1976').
• "Beyond Asymmetry: Critical Notes on Myself as a Young Man and on Some Other Old Friends." International Organization 32, no. 1 (Winter 1978): 45–50.
• "Exit, Voice, and the State." World Politics 31, no. 1 (October 1978): 90–107.
• "The Rise and Decline of Development Economics." International Symposium on Latin America, Bar-Ilan University, Israel, '1980'.
• "'Exit, Voice, and Loyalty': Further Reflections and a Survey of Recent Contributions." The Milbank Memorial Fund Quarterly. Health and Society 58, no. 3 (Summer 1980): 430–453.
• "Rival Interpretations of Market Society: Civilizing, Destructive, or Feeble?." Journal of Economic Literature 20, no. 4 (December 1982): 1463–1484.
• "Against Parsimony: Three Easy Ways of Complicating Some Categories of Economic Discourse." Bulletin of the American Academy of Arts and Sciences 37, no. 8 (May 1984): 11–28.
• "Against Parsimony: Three Easy Ways of Complicating Some Categories of Economic Discourse." American Economic Review 72, no. 2 (1984): 89–96
• "University Activities Abroad and Human Rights Violations: Exit, Voice, or Business as Usual." Human Rights Quarterly 6, no. 1 (February 1984): 21–26.
• "The Political Economy of Latin American Development: Seven Exercises in Retrospection." Latin American Research Review 22, no. 3 (1987): 7–36.
• "Exit, Voice, and the Fate of the German Democratic Republic: An Essay in Conceptual History." World Politics 45, no. 2 (January 1993): 173–202.
• "Social Conflicts as Pillars of Democratic Market Society." Political Theory 22, no. 2 (May 1994): 203–218.

Schema-based articles

• Shu-Yun Ma. "The Exit, Voice, and Struggle to Return of Chinese Political Exiles," Pacific Affairs. Vol. 66, No. 3. (Autumn 1993) pp. 368–385.
• Michael Laver. "Exit, Voice, and Loyalty revisited: The Strategic Production and Consumption of Public and Private Goods," British Journal of Political Science. Vol. 6. (Oct. 1976). pp. 463–482.

See also

• Hirschman cycle

References

External links

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• Albert Hirschman Papers at the Seeley G. Mudd Manuscript Library, Princeton University
• Albert Hirschman on orthodoxy and monoeconomics
• The New York Review of Books Bibliography
• Amherst Commencement Recognition
• Albert O. Hirschman Prize and Lecture
• Obituary from the Institute for Advanced Study
• "A great lateral thinker died on December 10th"
• Book review of “Worldly Philosopher: The Odyssey of Albert O. Hirschman” (Princeton), by Jeremy Adelman : The Gift of Doubt: Albert O. Hirschman and the power of failure by Malcolm Gladwell