Albert O. Hirschman on Economic Evolution

In this paper it will be argued that Albert O. Hirschman’s research work is a remarkable instance of a methodological shift that began in the Fifties, and of which there seems to be scarce awareness nowadays notwithstanding its relevance for some of the issues that are in the agenda of contemporary economics. In his work - so as in the work of other economists of his generation - systems theory was used as a general methodology to frame the study of structural change in the economy. The methodological questions raised by the study of ‘economic evolution’, extensively discussed nowadays, were very much in evidence in economics already in the Fifties in the theory of economic development. Contrary to what it often said, attempts to build a theoretical interpretation of economic change were in fact conducted within this research programme. Indeed, the focus of Hirschman’s research activity has been on the explanation of the relationship between the evolution of the social system and the economic process, and systems theory has been the methodological perspective he has relied upon in the study of this relationship. He was certainly not alone while walking along this pathway. Yet, more than other contemporary economists, Hirschman addressed, although with some elusiveness, a fundamental issue in the study of economic evolution, and namely the micro-foundation of economic change. Most of his research ought to be properly understood as an attempt to put forward micro-founded (meta-)theory of economic evolution. To discuss the whole corpus of Hirschman’s research work would be a too demanding task. The aim of this paper is in fact more modest. It intends to call attention to the methodology that Hirschman elaborated to address the issue of explaining ‘economic evolution’ – and to interpret it as a response to a class of why-questions that have constantly been prominent in the agenda of economists in the last decades.Hirschman, economic evolution, endogenous change, innovation, system theory