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Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations and States
PDF Ebook Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations and States
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Book
- Sales Rank: #1201844 in Books
- Published on: 1994
- Binding: Paperback
Most helpful customer reviews
5 of 5 people found the following review helpful.
Why fast food firms do not listen to customer complaints about cold french fries.
By Junglies
This little book makes for compelling reading even so many years after publication.
I first read the book whilst an undergraduate in economics. Given the formalistic nature of economics then, and even more so now, the contents were disturbing. While standard neoclassical theory attempts to make science out of human behaviours, it cannot make allowances for certain things such as differences in quality of products, choosing instead to assume those differencesaway.
Hirschman looks at the similar, yet different, different disciplines of economics and politics and examines consumer strategies in each case which he differentiates as exit and voice. In economics the assumption is that unhappy customers will switch to different suppliers and the environment of perfect competition will erode away differences until all products are uniform once more.
In politics where customers who are dissatisfied with the products can exit but the products remain the same or they can effect change through utilizing voice to argue for change.
The theory so far outlined has predictive ability which for some cases, proves correct. Complications though suggest that the usefulness of this theory as is is is limited. Hirschmann goes further and introduces another concept in his model which is loyalty and the combination of all three results in essentially a game with certain outcomes.
Once the model is complete he provides examples from American society and it's historical development to substantiate his reasoning and in doing so provides a coherent narrative of economic and political behaviour in contemporary American Society.
From a subjectivist viewpoint the analysis is an alternative prospectus to the formalist program. It contains subjectivist elements such as product differentiation from the standpoint of the consumer which I find appealing and is to some degree compatable with say, economics from the Austrian tradition or the Institutionalists.
However, I suspect that the validity of this theory is more suitable to the discipline of politics than economics and I examined the way that the Republican Party platforms have changed over recent years in North Carolina until they find their expression in the extreme form that they are today. The phenomena of growing extremism in a political party which is losing membership is readily explained by the contents of this book and thus does not bode well for bridging the political chasm which currently exists between the two major parties nor for the future prospects of the sadly misnamed Libertarian Party.
In any event this is really an important book which can be comprehended by those without a formal training in economics and is not just a book for sceptics but essential reading for anyone who wants to look a little further into a broader understanding of economics, politics, geography and law.
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