“Good and Bad” (not “Good or Bad”): Albert O. Hirschman as a Behavioral Economist

Albert O. Hirschman famously wrote against parsimony. He wanted to complicate economics. The locus of these complications was often individual behavior. This paper makes three arguments about such complications. The first is that the growing experimental evidence on individual behavior broadly supports many of Hirschman’s proposed complications. In particular, there is evidence of preference change under “reflection.” Second, I argue that there is experimental evidence of both “good and bad” preference change in market society. The third is that the policy of “nudging” would not sit well with Hirschman. “Nudging” is a return to the “parsimonious” instinct in economics; and it misses the real implications for policy of the insights from behavioral economics, which, of course, are more complex.