Rediscovering Albert Hirschman

To consider the life story of development economist turned moral philosopher Albert Hirschman is to appreciate that no other generation is likely to accumulate the experience of the European émigrés to America who came of age just before World War II, survived it, and went on to contribute to the political and scholarly foundations of postwar civilization. Of that generation, nobody did so with more range and grace than Hirschman.

There was a time in the 1970s and 1980s when Hirschman, who died last December at 97, enjoyed a wide general audience. But outside of academia, his works connecting economics and policies to core human values haven’t made it into the canon of writings that educated people feel they need to read. The results of my informal survey suggest that even among teachers who admire him, Hirschman’s work is invoked but not routinely assigned. This is a loss to our collective wisdom. We can hope that the publication of Jeremy Adelman’s new biography, Worldly Philosopher, and the 2015 centenary of Hirschman’s birth will rekindle interest.

Hirschman’s life breaks roughly into three phases. He was born in Berlin in 1915 to a moderately affluent German Jewish family and entered university in the fateful year 1932, completing one semester before Jewish students were expelled by the new Hitler government. The journey to finish his studies took him to Paris and London and Trieste; he also served in the Spanish Civil War and the French underground, running an operation under the noses of the Gestapo that helped more than 2,000 anti-fascists escape over the Pyrenees. Hirschman, bearing forged documents under the nom de guerre Albert Hermant, was not yet 26. In 1941, he took the same route out and came to the United States.

After serving in the U. S. Army and trying to gain his professional footing, in 1951 he accepted an improbable offer from Colombia’s National Planning Council to take up residence as a senior adviser. He relocated to Bogotá with his family and spent much of his midlife either based in Latin America or regularly traveling there, earning admiration as an expert who went into the field and listened to locals and whose empirical approach transcended the usual left and right categories.

Had Hirschman’s life ended in the late 1960s, he would be remembered as a development economist with a specialist audience. But in the third phase, he re-emerged as a modern philosophe. Beginning in 1970, he published a profusion of books and essays that crossed disciplinary boundaries, drawing on his fluency in five languages, integrating his far-flung experience and reading with his self-description as a trespasser. Above all, these works combined respectful attention to what was unique and particular about the subject at hand with a capacity to infer universal insights about human behavior and society.

What linked Hirschman’s early classical education and Latin American fieldwork to his later writings was an appreciation of human complexity. In his 1984 essay “Against Parsimony” (a characteristically playful title), he writes, “Economists often propose to deal with unethical or antisocial behavior by raising the cost of that behavior rather than by proclaiming standards. … They think of citizens [only] as consumers. ... This view tends to neglect the possibility that people are capable of changing their values.” Economic orthodoxy ignores the trait of self-evaluation.

Others have criticized the one-dimensional view of homo economicus but none with Hirschman’s wit and dazzling gift for forging connections. Yet he was sufficiently esteemed in his own profession that a revised, gentler version of this essay, like others of his, was published in the flagship American Economic Review, where the typical article has more algebra than text.


Hirschman is best known for a short book with an odd title, Exit, Voice, and Loyalty, published in 1970. When I first came across it, the juxtaposition of those three words in the title seemed quirky, as if each one referred to a different category of concept. But as I wrote in an obituary appreciation last December, Hirschman’s core insight is elegant and coherent. Citizens, consumers, and workers, he writes, when they find anything from a product to an employer, politician, neighbor, or nation unsatisfactory, have two basic ways of responding. They can walk away (Exit) or stay and provide constructive feedback (Voice). Though most economists emphasize Exit as the main source of market discipline—consumers abandoning high prices or shoddy goods, workers pursuing different jobs, shareholders deserting failing companies, emigrants seeking new shores—Hirschman observed that Voice had an important place in both politics and economics. Voice made possible civil society. Voice made business enterprises more than a collection of spot transactions. Voice offered useful feedback that facilitated “recuperation” of an enterprise, community, or polity. And to complete the trilogy of his title, Voice engendered reciprocity and Loyalty.

In the 1960s and 1970s, various social sciences were straining to emulate the natural sciences: Economics and political science chased the premise of “rational choice,” while psychologists chased rats. Hirschman aimed to restore the humanistic essence of the social sciences, reconnecting economics, politics, sociology, psychology, history, and philosophy. Long before the new specialty of behavioral economics arrived in the 1980s, with a richer empirical approach to complex economic motivations than either its rat-lab or rat-choice predecessors (yielding a Nobel Prize for one of its pioneers, Daniel Kahneman), Hirschman was laying the groundwork. At the time Hirschman made his transition from development expert to philosopher, the field of political economy had pretty much been left to Marxists. Hirschman redeemed it for liberals.

It’s surely the moment for a rediscovery of Albert Hirschman. A new generation is demanding Voice, whether immigrants seeking inclusion, women pursuing equality that acknowledges difference, workers who experience corporate employers as deaf to their needs, or young people finding self-expression in social media. As the democratic enterprise itself becomes captured by financial elites, discouraged citizens are increasingly opting for Exit when they should be redoubling civic Voice.

To read Hirschman at the peak of his intellectual powers is to enter a discourse filled with erudition, wordplay, and paradox, with taproots drawing from a vast range of sources. Exit, Voice, and Loyalty was informed not only by the classics and the upheavals of the 1960s but by Hirschman’s insights about the inefficiency of the Nigerian rail system, the arrogance of Milton Friedman, consumer complaints forwarded to Hirschman by Ralph Nader, Hirschman’s reinterpretation of Lord Acton, and the multiple exits and entrances of his own life. Reread after 40 years, Hirschman’s writing is above all fresh.

Exit, Voice, and Loyalty won Hirschman a devoted following and remains one of the most-cited works of social science. From his mid-fifties to his late seventies, Hirschman followed with books and dozens of essays imaginatively exploring how thinkers since the Enlightenment had addressed the interplay of market and society.

Hirschman was credible as a critic of his profession because he had serious training as an economist. His dissertation at Trieste was a careful piece of technical work on French public finance. His faculty appointments at Harvard, Yale, and Columbia were in economics. In the standard HH index still used in antitrust cases that measures the degree of market concentration, one “H” stands for Hirschman. Exit, Voice, and Loyalty includes four short appendices putting his arguments into formal mathematics. But the brilliance of Hirschman’s work is his synthesis of the sensibility of economist and anti-economist. He is dismayed at how orthodox economics settles by assumption issues that beg for curiosity.

 Where did such a man come from? Jeremy Adelman, a distinguished historian of Latin America at Princeton, has written the first major Hirschman biography—close to an authorized one, since Adelman had access to Hirschman’s papers, diaries, and letters; he interviewed Hirschman while his subject was still active and enjoyed the cooperation of his family and colleagues. Worldly Philosopher will be the definitive work on Hirschman for some time. But despite 657 pages and scads of fascinating new details, the book stops just short of being a full intellectual biography.

The first half, on Hirschman’s youth and early adulthood, is superb. Hirschman, we learn, grew up in a warm home filled with books and classical music on the gramophone. He was athletic as well as intellectual. There were summer beach vacations, winter ski holidays, backpacking trips. Hirschman’s father, Carl, was a doctor, and the family was not just assimilated but patriotic. Hirschman’s original name was Otto Albert Hirschmann (with a second “N”): Otto for Chancellor Otto von Bismarck, Albert for his own grandfather. Known as OA, he showed an early affinity for wordplay in multiple languages. Devouring Hegel and Thomas Mann, he epitomized the German tradition of Bildung—intellectual and spiritual cultivation of the self.

He was an idealist, even a romantic, but above all a survivor. Unlike some German Jews, Hirschman, not yet 18, was never in denial of what was coming. On April 1, 1933, the day of his father’s funeral, Adelman writes, “the first wave of government-sanctioned violence swept Berlin, with assaults and boycotts on Jewish shops and businesses.” Among the mourners, his 13-year-old sister Eva “was inconsolable,” and Carl’s widow, Hedwig, “burst in great fits of sobbing.” But Otto Albert “was a model of unfeigned stoicism. … As evening approached, OA emerged from the bedroom to inform the guests and his mother that he would be leaving very soon for Paris. … On April 2, he was gone.” Not until decades later, in the introduction to a German translation of Exit, Voice, and Loyalty, did Hirschman acknowledge that his own abrupt exit had informed his sensibilities.

Through Berlin contacts and recommendations from his old lycée, Hirschman applied to Paris’s grandes écoles. A colleague discouraged him from trying for the prestigious Sciences Po, which primarily graduated civil servants and diplomats. He was accepted at the school of business and accounting, the École des Hautes Études Commerciales (HEC), with delicate hints that this was the better place for a Jew. In Paris, he found political mentors. The lover and later husband of his older sister Ursula, an Italian philosopher and socialist of range and depth named Eugenio Colorni, six years Hirschman’s senior, became a cherished friend. Colorni, later a notable anti-fascist underground activist, survived Mussolini only to be murdered by a Nazi gang in 1944. Exit, Voice, and Loyalty is dedicated to him.

Hirschman chafed at the narrow confines of the HEC, and in 1935 he applied for a fellowship at the London School of Economics. There he encountered the great economists of the age, both left and right. He was standing in line at the campus bookshop when Keynes’s General Theory went on sale, Adelman reports. “It was not just what economists were arguing about that intrigued Hirschman,” Adelman writes, “it was the fact that they were arguing about ideas.”

But ideas were under assault from multiple quarters, and in 1936, Hirschman joined up with anti-fascist intellectuals volunteering to fight in the Spanish Civil War. Italian exiles in Paris had organized some of the first international brigades. One of the early casualties was Hirschman’s former Italian tutor. Fighting alongside Italian volunteers, Hirschman narrowly escaped death—most likely in the grisly battle of Monte Pelato on the Aragonese front, according to Adelman. After three months in Spain, Hirschman followed Ursula to Trieste.

By the time Hirschman finished his doctorate, Jews were being hounded out of Italian academia. Hirschman again served as a resistance fighter. One of the most vivid parts of his story is his Casablanca-like role as forger, courier, and visa procurer in Marseille. The tale has been told before, but Adelman enriches the story. To give refugees false identities, Hirschman purchased demobilization papers from former French soldiers. He did a brisk business in forged Czech, Lithuanian, Polish, and Panamanian passports that qualified the holder for a transit visa. Working with the American journalist Varian Fry, he traced out a refugee escape route over the Pyrenees into fascist though neutral Spain—none too hospitable—and thence to allied Portugal. Among those saved were Marc Chagall, Hannah Arendt, Marcel Duchamp, Alma Mahler, Max Ernst, and Jacques Lipchitz, as well as opposition leaders of Europe’s socialist and liberal parties.

Hirschman followed the same path out in late 1940, armed with a fellowship offer from the Rockefeller Foundation. When he landed, the immigration authorities at Elizabeth, New Jersey, stripped the second “N” from his surname and Hirschman flipped the order of his first and middle names to go by the more American sounding Albert. Exit, again.

This part of Adelman’s book is valuable not just for the gripping story but for the new information about the soil in which Hirschman grew. One lifelong concept Hirschman took from Colorni was that of piccole idee—small insights that could grow into a large idea. Hirschman and his wife Sarah, whom he was to meet at Berkeley, mostly spoke French at home and were forever exchanging and celebrating petites idées. The phrase became an endearment reflecting the affinity of an intellectually and emotionally close marriage that spanned six decades. Adelman, who notes Hirschman’s good looks and enjoyment of the company of women, reports that among his other virtues there is not a shred of evidence that Hirschman ever had an affair. Loyalty was something he lived.

In 1942, after finishing his fellowship at Berkeley, Hirschman enlisted in the U.S. Army and was assigned to the Office of Strategic Services as a translator. In Italy, he served as interpreter at one of the first allied war-crimes trials. During the five-day proceeding, Hirschman sat side by side with Nazi general Anton Dostler, who’d given an order to execute prisoners. The New York Times reported that the young interpreter turned pale as he translated the death sentence.

If you liked Edmund de Waal’s The Hare with Amber Eyes, you will find Adelman’s story of Hirschman’s early life riveting—a book-club quality read. The book’s second half, however, is slower going. Adelman recounts a forest of primary-source detail on comings and goings, logistics and academic politics. Occasionally he misses the tree—Hirschman himself.


Hirschman became a development expert almost by accident. He’d been invited to work on the Marshall Plan but was denied a security clearance. As an active anti-Nazi in the 1930s, he had inevitably consorted with radicals. A fine chapter reflecting Adelman’s extensive detective work describes how postwar bureaucratic paranoia led to the conclusion that this anti-fascist, anti-communist intellectual might be a security risk. So off the Hirschman family went to Colombia. Hirschman’s initial charge was to help formulate a master plan for Colombian development. But he ended up traversing the country to gain insight on the “micro-foundations of economic development.” As Adelman writes, “He crisscrossed Colombia, pen in hand and paper handy, examining irrigation projects, talking to local bankers about their farm loans, and scribbling calculations about the costs of road building.”

In the postwar years, Latin America was assumed by mainstream economists to be a victim of internal obstacles to development, which ranged from corruption to protectionism to the legacy of feudalism. Radicals, by contrast, emphasized neocolonial influences and the region’s dependency on global capitalism. In his own work on development, Hirschman criticized the dominant theories of the time, like those associated with economists Paul Rosenstein-Rodan of the World Bank and MIT’s W.W. Rostow, which held that underdeveloped economies needed a big, Western-style push to allow “takeoff” and “self-sustaining growth.”

While advocates of “balanced growth” tended to favor grand plans and large infrastructure projects, Hirschman, ever embracing paradox, thought growth in fits and starts would produce pressure for needed infrastructure. In Hirschman’s term, development “linkages” could either reach forward to products or backward to inputs. Rejecting universal blueprints, Hirschman urged countries to play to their distinctive strengths.

Oddly, given that Adelman is a historian of Latin America, this is one of the weaker parts of the book. It may be that he is too close to the material or that he got bogged down in the detail of Hirschman’s endless trips. For all of Adelman’s fine reporting, his discussion of Hirschman’s intellectual debate with other development theorists is somewhat murky, and he neglects to address how Hirschman’s views have stood the test of time. In fact, many successful late-industrializing nations, from Korea to Brazil, opted for the big push of which Hirschman was so skeptical, though they did often reject the World Bank’s formula.

One important thing we do learn from Adelman is that Hirschman’s courageous rescue instincts followed him from Marseille to Buenos Aires and Santiago. He used foundation and university contacts to secure positions in the U.S. for at-risk intellectuals in countries under dictatorships, much as the Rockefeller Foundation had done for him four decades before. Adelman also suggests how Hirschman’s fieldwork reinforced habits that aided his great capacity for synthesis later on:

“As he travelled, Hirschman filled his notebooks with petites idées, insights he accumulated along the way: observe, infer, compare, generalize, and then check these generalizations against new observations—and where possible, aphorize. There was a thread in all this: tracing the hidden, unexpected, and sometimes surprisingly positive effects of projects often missed in cost-benefit calculus.”


In 1968, on sabbatical at the Institute for Advanced Study in the Behavioral Sciences at Palo Alto, Hirschman wrote the essay that became the germ of Exit, Voice, and Loyalty. Adelman describes the book as a “hyphen linking an ‘early’ Hirschman concerned with economic development in Latin America to a ‘later’ Hirschman working from a broadened intellectual palette.” Yes, but this leaves out the formative Hirschman—the voracious student of political classics, resistance fighter, and refugee scholar who unmistakably makes a reappearance in the later philosophical works.

Hirschman, who found teaching a chore, thrived in an interdisciplinary milieu with colleagues but not students. In 1972, he landed in a setting that could have been made for him.  He was recruited for a visiting fellowship at the Institute for Advanced Study in Princeton, and after a one-year stint he was approved (by the unusually enthusiastic vote of 14-0) for a rare permanent position.

Discussing Hirschman in his most influential period, Adelman pinpoints arguments and sources from the notebooks that fed into the writing. He doesn’t always get the import quite right. In The Passions and the Interests, Hirschman explored how Enlightenment political philosophers hoped that passions, explosive and nonnegotiable, could be tamed into interests available for brokering and compromise. With contending passions, there could be no civil society, Hirschman wrote. But with interests, there could be the give-and-take of democracy. In Adelman’s retelling, “The rule of passions, without checks, could lead to horrible utopias; the reign of interests to soulless pragmatism.” This wasn’t Hirschman’s point.

In his 1982 essay “Rival Views of Market Society,” Hirschman marveled at the fact that over three centuries, conservatives and radicals have switched sides on the question of whether markets are supportive or destructive of society. Adam Smith was embraced by 18th-century liberal reformers, who correctly foresaw that market forces would overthrow aristocratic privilege. Conservatives like Edmund Burke feared the same disruptive consequences. But by the 19th century, conservatives were cheering the dynamism of markets, while critics such as Marx deplored the trampling of historic rights of peasants and artisans. Later, 20th-century liberals such as Karl Polanyi and Hirschman saw markets as crowding out other values. Advocates from Montesquieu onward hoped that the bonds of commerce would tame bellicose impulses; two world wars among trading partners demolished that hypothesis. In Adelman’s account, Hirschman comes across as somewhat friendlier to Smith than Hirschman does in his own work—and Hirschman became less enamored of Smith over time.

Though hard to pigeonhole, Hirschman was a man of the moderate left. As American politics moved to the right and free-market ideas gained traction in the academy, his critique became more explicit. In The Rhetoric of Reaction (1991), a wholly original synthesis of the classic and the modern, Hirschman notes the recurrence of three conservative arguments against social reform through the ages. He names them Perversity, Futility, and Jeopardy. Reform allegedly hurts the very people it hopes to help (Perversity); it incurs costs only to end in failure (Futility); and it undermines cherished values (Jeopardy). Thus the arguments of modern reactionaries such as Charles Murray have precise antecedents in the 18th century, such as Bernard de Mandeville’s essay “The Fable of the Bees.”  The book displays Hirschman’s almost childlike joy of discovery. It is his innocence as a seeker that keeps him from seeming pretentious or show-offy.


Hirschman’s life, Adelman aptly points out, “can be recounted as the biography of a reader. … Such a narrative would arc across familiar categories of an intellectual biography, from formation to contribution, from absorption to creation.” Exactly so, though in the biography Adelman has chosen to write, we learn more of the life than the life of the mind. Despite blemishes, however, Worldly Philosopher is a prodigious piece of research, lovingly told and immensely worthwhile for the new light that it sheds on the odyssey of a writer whose small ideas add up to major insights.

Late in Adelman’s book there is a poignant chapter on Hirschman’s return trip to Berlin in 1990 and 1991. Hirschman’s notes on the visit, prepared for an essay he never completed, reflect on the “silent exit” of so many refugees. As he visited monuments to the deportations, Hirschman seemed defiant, according to his son-in-law Peter Gourevitch’s interview with Adelman—as if to say, “I survived. I am back. You lost.”

If Hirschman’s survival as a widely read author is in doubt, Adelman offers some clues as to why. Hirschman was a crosser of boundaries, and no one discipline can quite claim him. He is not a natural for either an undergraduate syllabus or for recreational reading. He was modest and bookish, far from a self-promoter. But as we pursue the recovery of Voice, Hirschman should be part of our common heritage. He is one of a small number of 20th-century social scientists whose work can be called timeless.

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