Exit

,
Voice,
and

Loyalty
Responses to Decline

in Firrns, Organizations,
and States

AlbertO. Hirschman

Harvard University Press
Cambridge, MassachusetLs
and London, England

Ì
I

I

I
t
I

t
r
Ë

r.

I

å

Ë

I
&
Ë

å

g
$
å

å
s
$
,Ër

&

å

1

Introduction
and Doctrinal.Background
Under any economiq social, or political system, indivicluals, business firms, ancl organizations in general are
subject to lapses from efficient, rational, iaw_abicling, vir_
tuous, or other¡rise functional behavior. No matter how
well a society's basic institutions are devised, failures of
some actors to live up to the behavior which is expectecl of
them are bound to occur, if oniy for all kinds of accidental
reâ,sons. Each society learns to live with a certain amount
of such dysfunctional or mis-behavior ; but lest the misbehavior feed on itsetf and lead to general decay, society
must be able to marshal from rvithin itself forces which
will make as many of the faltering actors as possible re_
vert to the behavior required for its proper functioning.
This book undertakes initially a reconnaissance of these
forces as they operate in the economy ; the concepts to be
developed will, however, be found to be appticable not only
to economic operators such as business firms, but to a wide
variety of noneconomic organizations and situations.
While moralists and political scientists h¿ve been much
concerned with rescuing individuals from immoral be_
havior, societies from corruption, and governments from
decay, economists have paid little attention fo repairøbte
lø,pses of economic acto¡s. there are two reasons fo¡ this
neglect. First, in economics one assumes either fu y and
undeviatingly rational beh¿vior or, at the very least, an
unchnnging leael of rutionality on the part of the economic
actors. Deterioration of a firrn's performance may result
from an adverse shift in supply and demand conditions
while the willingness and abiìity of the firm to maximize
profits (or growth rate or whatever) are unimpaired; but
it could also reflect some .'loss of maximizing aptitude
or energy" with supply ancl demand factors being un_
1

. economists have t¡aicaily assumecl that a firm that falls behind (or gets ahead) does so " for ø good.Exit Voice. large realms of monopoiy. isn't it the experience of declining revenue and the threat of extinction through competition that will cause its managers to å f ï I make a major effor-t to bring performance back up to where it should be? the¡e can be no doubt that competition is one major mechanism of recuperation. it must obviously be viewed with an alarm approaching that of the political scientist who sees his polity's integ'rity being threatened by strife. In the traditional model of the competitive economy. The latter interpretation woulcl immediately råise the question how the firm's maximizing energy can be brought back up to par. has been alien to their reasoning. subjective f¿ctors that are reversible or ¡emediable as to permanent adverse shifts in cost and demand conditions. however (1) that the implications of this particula-r function of competition have not been adequately spelled out and (2) that a major alternative mechanism can come into play either when the competitive mechanism is unavailable or as a complement to it. t'ne eoncept-centrâl to this bookof a random and more or less easily "repairable lapse. its market share is taken up and its factors are hired by others. and Loyalty changed. But even where vigorous competition prevails. oligopoly. unconcern with the possibiliþ of restoring temporarily laggarcl firms to vigor is hardly justified. At this point. there are the well-know¡r.. As one firm loses out in the competitive struggle. Having accounted for the economist's unconcern we cân immediately question its justification : for the image of the economy as a fully competitive system where changes in the fortunes of individual flrms are exclusively caused by basic shifts of comparative arlvantage is surely a defective representation of the real ¡vorld. and in that câse. corrup2 Introduction and Doctrinaì Background i I î Í tion. in the upshot. the per¿) . or political parties ) that provide services to their me¡nbers without direct monetary counterpart. including newcomers . Is not competition supposed to keep a frrm . mechanisms of recuperation wouid play a most useful role in avoiding social losses as well as human hardship. recovery from any lapse is not really essential. It will here be argued. precisely in sectors where there are 1arge nurnbers of f. trade unions. Enter "Exittt and "Voice" The argument to be presented starts with the firm producing saleable outputs for customers . principally-applicabte to organizations (such as voluntary associations.rms competing with one another in similar conditions. it wili be interjected that such a mechanism of 4ecuperation is readily available through competition itself. or boredom. The second cause of the economist's unconcern about lapses is relatecl to the first. declines in the fortunes of individual firms are just as likely to be ilue to random. at times. In these circumstances. In the first place. and monopolistic competition: deterioration in perforrnance of firms operating in that part of the economy could result in more or less permanent pockets of Lnefficiency and neglect.on its toes"? And if the firm has already slipped. reason" . the reversibility of changes in objective supply and demand conditions is much more in doubt. In other words. the economist can afford to watch lapses of any one of /¿is patients (such as business flrms) with far greater equanimity than either the moralist who is convinced of the intrinsic worth of every one of htls patients (individuals) or the political scientist whose patient (the state) is unique and irreplaceable. With this picture in mind. total resources rnay weìl be better allocated. but it will be found to be largely-and. But the usual interpretation is the former one.

Exit. As a result. changes in eithe¡ price o¡ quality are ¡uled out when both a¡e ¡igidly dict¿ted by a pe¡fectty competitive market. . management once agâin engages in a search for the causes and possible cures of customers' and members' clissatisfaction. that is. (2) The frrm's customers or the organization's members express their dissatisfaction directly to management or to some other authority to which management is subordinate or through general protest addressed to anyone 'who cares to listen: this is the uoì. membership declines. lt is pe¡haps because the whole raage of phenomena here desc¡ibed has no place in the perfectly competitive modeÌ that it has not been paid attention to by economists. for both firms and other organizations. A highly complex relation5 . random causes which are neither so compelling nor so durable as to prevent â return to previous performance levels. then. As a result. Taiking with students of anim¿l behavior (at the Center for Advancecl Stutly in the Behavioral Sciences) about the soci¿l organization of primates I learnt about the smooth¡ess and efficiency with rrhieh leadership succession. shall now step back briefly and indicate how I conceive the subject of this book to be related to economic and social science thought around us. repeâted retrieval trains her not to go a. Here is how the process is described for a typical band of Hamadryas baboons lordecl over by one male leader: I Sub-adult males steal very young females from their mothers and attend them s'-ith every semblance of solicitous nlâternal care. provided mânagers direct their attention and. will le¿d straightarpay to a decline in net ¡evenue. a problem human societies have found so intractable. Voice. without any inte¡mediation on the part of the custome¡s v¡ho remain totally unas/are of the ñrm's troubles. to improve the working of the voice option? Latitude for Deterioration. and Slack in Economic Thought Before setting out to answer some of these questions. in an absolute or comparative deterioration of t}lLe qn\itA of the product or service provided. and.¡¡ay . . was handled in cert¿in baboon bands. the younger animal starts initiating group movements although the direction of eventual movement is dependent upon the older animal's choice.ce opt¿on. in this admittedly unrealistic situation. Oû the other hand. and Loyalty formance of a firm or an organization is assume¿l to be subject to deterioration for unspecified. the female being yet two to three years from child bearing . managers learn about their failings directly and exclusively f¡om ûnancial evidence genelated \¡¡ithin the Érm. and management is impelled to search for ways ântl means to correct whatever faults have led to exit. performânce deterioriation can also be reflected in cost and resulting price increases o¡ in a combination of quality drops and price inc¡eases. detedo¡ation can manifest itsel{ only via irrcreases in cost whieh. Under perfect competition.l Management then frnds out about its failings via two alternative routes : (1) Some customers stop buying the flrm's products or some members leave the orgånization : this is the ¿rrlú option. Fo¡ business firms operating in situations of monopoly or monopolistic competition. At this stage there is no sexuai behaviour.ges. The remainder of this book is largely devotecl to the 1. I will investigate questions such as: Under what conditions will the exit option prevail over the voice option and vice versâ? What is the comparative efrciency of the two options as mechanisms of recuperation? In what situ¿tions do both options come into play jointiy? Wh¿t institutions could serve to perfect each of the two options as meehanisms of recuperation? Are institutions perfecting the exit option compatible with those designed. As these young interlopers mature and the overlord a. with price and quality unchanged. energy to that task. The cleterioration in performance is reflected most typicalìy and generally. . 4 Introduction and Doctrinal Background comparative analysis of these two options and to their interplay. . The young female is rigorously eontrolled. revenues drop.

by paying close attention to one another and. . Yoice. $ ç. Olcl males retain cornrnand of group direction but graclually relinquish sexual control over their females to the younger male animal . In the eighteenth century the expansion of commere¡ and of industry was sometimes hailed not so much because of the increase in welt-being that it would make possible." Bi. and whieh is immediatety destroyed.cal. London). Sociøl Behaoicur i. ed. any homeostatic controls ¡¡¡ith ¡vhich human societies might be equipped are bound to be rough. John Hur¡ell Crook. Recognition of this unpleasant truth has been impeded by a recurring utopian dream: that economic progress. Occasional decline as well as prolonged. to look for social anangements that 2. and which may be th¡own aside antl taken up again at pleasure) . to humans." cooperate in governing group movement.møIs ønd Man (to be published by Academic P¡ess. by the complicated system of modern oeconomy. for example. but because it would bring with it powerful restraints on the willfulness of the prince ancl thereby reduce and perhaps eliminate the system's I t r Ë r å å. while inc¡easing the surplus above subsistence. to faulty political processes. that the evil which might otherwise result from them may be guarded against with eâse The power of a modern prince.nto the Principles of Pol. control over his environment. it will at length come to resemble the delicacy of the watch. 1968). will also bring with it disciplines and s¿nctions of such severity as to rule out any backsliding that may be due. or touched with any but I . The reason for rrhich humans h¿ve failed to develop a f. at least initially.. The passage quoted summarizes resea¡ch by Hans Kummer. å w latitude for deterior¿tion. A priori it would seem futile. "Social Organization of Hamadryas Baboons. foolg or criminals." in J. One characteristic passâge from Sir James Steu¿rt's Inquírg i. "The Socio-Ecology of Primates. merely causes discomfort. It seems that eventuaþ old males resign entirely from their originai reproduction units but retain great influence within the band as a whole. by reciprocal "notification. and Loyalty ship develops between the two anim¿ls which. for splitting of timber.ùti. stones and other hard bodies. immediately becomes limited so soon as he establishes the plan of oeconomy . mediocrity-in relation to achievable performance levels-must be counted among the many penalties of progress. Because of the surplus and the resulting latitude. Most human societies are marked by the existence of a surplus above subsistence. Karger. when the mech¿nism of government wâs more simple than at present. let it be by the constitution of his kingdom ever so absolute. 6 (Basle: S. they âre no\ry' brought under such restrictions.nely built social process assuring continuity and ste¿dy quality in leadership is probably that they did not have to. which is good for no other purpose than to rnark the progression of time. The wide tatitude human societies have for deterioration is the inevitable counterpart of man's increasing productivity and. 6 I Introduction and Doct¡inal Background I would wholly elimin¿te any sort of deterioration of polities and of their various constituent entities. A lorrer level of performance.bliothecø Pri. and young males refer to them continuously particularly before developing the direction of march. therefore.2 Compare this marvel of graduâlness and continuity with the violent ups and downs to ¡¡¡hich human societies have always been subjeet as "bad" government followed upon "good.matologicø. no. which woulcl mean disaster for baboons. ." anal as strong or ivise or good leaders were succeeded by weaklings. Oeconomg (1?67) will sufrce to make the point: How hurtful soever the natural and immediate effects of political revolutions may have been formerly.Exit. IL Crook.n Ani. if put to any other use. the counterpart of this surplus is society's ability to take considerable deterioration in its stride. If his authority formerly resembled the solidity ¿nd force of the wedge (which may indifferently be made use of.

indeed. This posthumously published essay $¡as written in 1947. l. to man's fundamentally ambivalent attitude toward his ability to produce a surplus : he likes surplus but is fearful of paying its price. A å # å å & Ë . 1958).4 History has crueliy disappointed the expectations of both Sir James Steuart and Nieto Artet¿ that economic growth and technical progress would erect secure barriers against "despotism. and Loyalty the gentlest hand .L 3. only a year befo¡e the outb¡eak of the sanguina¡y civil disturbances knov¡¡ as La øi. in a sur_ plus situation: it is producing a surplus. These various obsewations add up to a syndrome.277. therefore. but is not at liberty not to produce it or to produce less of it than is possible . Voice. not unrelated to today's widespread belief that a mâ. El café en ln socied.34J5.. was totally absorbed by the neecl fo satisfy his most basic drives. and ¿ radical but basically simple act of the imagination may well have metamorphosed this condition which one was really & I I arcþ. correlated : [In the pre-coffee era.ana (Bogotá: Breviarios de o¡ientación colombiana. While ulwilling to give up progress he hankers after the simple rigid constraints on behavior that governecl him when he. rather than positively. like alt other creatures.27&-279. pp.bove the narrowly constrainecl condition of all other living creatures was frequently sensed. .ith Ìittte reality-content." with economic¿lly useful resources fully occupied. (Chicago: University of Chicago Press. though it can hardly ever have been avowed. that lhe rise of man a. now be so cleariy disastrous that they will be more securely barrecl than before. The ideological absolutism w-ill disappear a¡rcl the epoch of moderation and sobriety will dawn . It is. is the most effectu¿l bridle ever was invented against the folly of despotism. policy makers] are i¡zical ancl romantic because they cannot yet defer to a product whose output is constantly on the increase. modern oeconomy. The economist ca¡not f¿il to note the similarity of the situation with the model of perfect competition. ancl then again it is not. 4. against all likelihood. Coffee wili bring maturity and seriousness. It is a time of childhood ancl play." ânal irresponsible behavior in general. in effect. It will not permit Colombians to continue playing fast and loose rvith the national economy.8 This noble hope echoes nearly two hundred years later in the writings of a Latin American intellectual similarly predieting. but every individual flrm consiclered in isolation is barely getting by. Fo¡ this model contains the same basic paradox : society as a whole produces a comfo¡table and perhaps steadily increasing surplus. so that a singie false step will be its untloing. everyone is constan y made to perform at the top of his form and society as a whole is operating on its-forever expanding-. nameþ. 8 but tolerabte consequences would. so that certain types of social misbehavior which previously hacl unfortunate Introduction and Doctrinal Bachground Ë * ä si w: w ilt 's. that economic progress and latitude for deterioration will be negatively. even when perfect competition was recognizecl as a purely theoreticaj construct w. ä bare subsistence situation. The common assumption of these constructs is simply stated: while tech¡ical progress increases society's surplus above subsistence it also introduces a mechanism of the utmost complexity and delicacy.production frontier. . just as Sir James St¿ua¡t wrote about the definitive conquest of despotism not long before the rise of Napoleon. 1966). as a fatl. This image of a relentlessly taut economy has helcl a privileged place in economic analysis.¡ Exit. As a result.olenciø. Coffee is incompatible with an- å I F i I ." "anarchy.jor war is unthinkâble ând therefore impossible in the nuclear age. .ød colvnbi. in fact. social behavior is as simply and as rig_ idly prescribecl and constrained as it is in a no-surplus. Luis Edua¡do Nieto Arteta. Yet their line of thought is hardly extinct. Who knows but that this hankering is at the root of the paradise myth ! It seems plausible. As a result society is.

He writes : 6_. Professor M. that market demand curves for individual commodities are negatively inclined) are consistent rvith ¿ wide range of irrational and inefficient behavior on the part of consumers and produeers even though these theorems hacl originally been derivecl on the assumption of undeviating rationality.: Prentice-Hall. community goodwill. market shares. The book contg. the Garden of Eclen." Amerîrøn Econon'ìa Reoìeu. Harvey Leibenstein.' euarterlg Jouranl of E cotnzn:ics. Finally am not concerned with I the large body of writings showing that the actions of conscientiously maximizing private produeers and consumers måy fail to produce a soc'ial optimum. The simple idea that the aþilijl:Jo-prodUce â surplus above subiFnCe mãkes måxtmum ucible su has not modei of the permanently taut economy. who in their book A B ehnuiorql.' Journal of Politir. 56:3924L6 (June 1966). E. But of late there h¿s been increasing attention to the possibility of just such a failure. Inc.umph of M edioct i. he is again fed and is at test.provement. whatever it is that firms do. Ær early.A. I am hungry o¡ thirsty like him. 7.aclc economy begin to be available. Richa¡d M.ins an elabo¡ate statistical demonstration that.'at the mieroeconomic level. elements of a theory of the sl. A. Beh. 10 II. because of the existence of monopolistic elements ancl externalities. they do it the best they can even though the criterion for "best" performance is becoming rather murky. the assumption undertying this dispute is that.) Here again the difference betrveen actual and potential output is not due to some "failure of nerve. _ 8. "A Behavio¡al Model of Rational Cinoice. but when thi¡st or hunger ceåse. and Loyalty Introduction and Doctrinal Background yearning for into its exact opposite.. Eøseelatß. for there is another side to our story. Nor is the question of slack involveil in the dispute about what it is that business firms.. I am not at rest. really do maximize: proflts. Cyert and James G. Becker. Samuel Johnson i¡rtimated this thought in his fable about the Ilappy Valley of . March. 9. Simon's suggestion th"at firms are normally aiming at no more th¿n a "satisfactory" rather than at the highest possible rate of profits. 69:98-118 (1952).õ But we must leave paradise ancl return to social thought. he is hungry and crops the grass. he is satisûed and sleeps. complltely fgrgotten empirical work with a ¡elated theme has the signiflcant title The T'ri. growth. but am not. published in 1933 by the Bureau of Business Research. 5.Simon.. he is lhi¡stV an{ drlnks the süream. his tlLi¡st and hunger âte appeased. Gary Becker showecl that some of the basic and empirically well-tested microeconomic theorems (for example." ( Samuel Johnsoir." At about the same time. over a period of tùre. Gary S. Tlteorg of the FirmT introduced the concept of "organizationai slack. "-Allocative Efficiency versus X-EfÊcieney.ai.e Finally.Wltat makes the diffe¡ence between man and all the ¡est of the animal c¡eatio¡? Every beast that strays beside me has the same corporal necessities witå myself. Postan has recently contended thåt Britain's economic ailments are better understood by focusing on microeconomic slack than on âny mistaken macroeconomic policies. he compares his condition to that of some gtazing goats in the followiag terms: .52:1-13 (Februa¡y 1962).. I am like him pained with want.J. satisûecl with fÌrlness. I am not referring now to unemployment and depression economics slack associatecl with these phenomena results from -the malfunctions at the mac¡oeconomic level which frustrate 1ìrms ¿nd individuals in their supposedly undiminished zeal to maximize profits anrl satisfaction.byssiria. in a widely discussed polemical essay. like him.s The importance of slack was later afrrmed in a particulariy sweeping form by Harvey Leibenstein. and particularly the large corporations. 1968). initially high-pedonning firms q¡ill on the average show dete¡ioration while the initial low performers will exhibit ia.Exit. A seminal contribution in this area was H. No¡thwéste¡n University.by IJotace Secrist.øI Ðconorrug. he rises again and is huagry. -4. 11 ..€ This notion was given considerable underpinning in 1963 by Rich¿rd Cyert and James March.tg in Busitæss. Wìen P¡ince Rasselas ûrst analyzes the discontent he feels in the paradiselike vaIIey. M. "I¡rational Behavio¡ ¿nd Economic Íheory. or some composite functions of such objectives. Voice.o.oral Theory ol the Firm (Englewood Clifis. N.

repressed. 7:2t1-212 (April 1962). to retrieve the id. 5. ancl decision making can be squeezed out of it by pressure meehanisms. and that additional investment. c}:'s.nd Culturd. Bonini. 11. The crucial. Policy Making: Some Converging \iews. or the high level of prices.Exit. ". can be expected to react to their shocking discovery along two principal lines. 1962).s on calling forth and eniisting for development purposes resources ancl abilities t]nat are hidden. 15.l? 13. Hi¡schman. As long as the pressures of competition do not seem to be sufficient. "Economic Development. design. Chades P." BehøuioT øl Sci'ence. 1958)' p. salesmanship. forcing the firm to be "on its toes. as a resuit. 16. See Leibenstein. I stressed. Postan. "The Di¡ection of Technological Change: Inducement Mechanisms anil Focusing Devices. See.18 ( Octobe¡ 1969)." 14. 17. the economy are ordinarily far from doing as well as they might. Research and Development. Nathar Rosenberg. rather similarly the existence of obstacles to entrepreneurial and cooperative behavior needed for the making of development decisions. 44. Cyert antl March refer primarily to the bargaining process that takes place among the various parties whose (shalry) coalition is required for factors to be hired ancl. for example. the advocates of social revolution have contributecl to this line of thought: one of their most seductive arguments has long been that only revolutionary changes can tap and liberate the abundant but dormant. .ls Frequent changes in the environment. or the insufrcient allocation of national resources to research and development. or the behavior of groups of labor.1€ Finally." will be identified as one way of inducing performance closer to the frrm's potential. The immediate and most obvious reaetion is ¿ determinecl search for ways and means to take up the slack. an economy's resources âre rigidly fixed in amount.la Insofar as innovation is concernecl. 12. . for output to be producecl ancl marketed. Carnegie Institute of Technology. 5-8. or alienated energies of the people. p. but in specific failures of its indiviclual cellsmanagement. The basic proposition of ?hø Strategy of Econom'ic Deaeloptnent (1958) was that "development depends not so much on finding optimal combinations for given resources and factors of production a. M. the inducing and focusing virtues of strikes and war have been stressed. Those who have found that the individual economic operators and. E. ancl more to as not be considered play if production into will come resources or factors of ga1imbalances that development is marked by sectoral public private into or authorities vanize entrepreneurs åction .ønge. such as the low rate of såvings.4 Plague of Economists?" Encounter (Janu' ary 1968). "Allocative Efrciency tersus X-Efrciency. ." Econnnic Deoelopû¿ent o.ticøl Economy of G'rowth (Nexr York: Monthly Review Press. but plausible. hours of u'ork. (New Eaven: Yale University P¡ess. Leibenstein's emphasis is on the uncertainties surrounding the produetion function and on the nonmarketability 10. Voice. Lindblom: At any one point of time. Paul 3'ara4 The Poli. aiìments the morbid causes will be found not in the mâlfunctioning of the life processes in the body economic. diss. assumption here is that there is some "slack" in the economy .eal of the taut economy.l Ch." 11 And the term slack actually came under my pen when I summarized later on the essential argument of that book in an article co-authorecl with C. t2 Introduction and Doctrinal Background of managerial and other skills. M. scattered or badly utilized.12 Various reasons h¿ve been invoked for explaining slack.StrûtegA. 1957). 13 . and Loyalty For many (perhaps most) of these . "Simulation of Information and Decision Systems ir the Firm" (unpub.ls My own search concentrated on pressure mechanisms such as intersectoral and intrasectoral i¡nbalances and on production processes that exact high penalties for poorþerformance or do not tolerate it at ali. productivity.lo I feel considerable kinship rvith this group of writings for I had adopted a simiÌar position in dealing with the problem of development. the pressures of adversity will be invoked.

But soon enough a degree of apathy was found to have some compensating advant¿ges in as much as it contributes to the stability and flexibility of a political system and provides for "reserves" of political resources which can be th¡own into the battle in crisis situations.ted as a result of some sort of

entropy characteristic of human. Firms and other organizations are conceived to be permanently and randomly subject to decline and decay. and surplus-producing energ:f. times slack acts like a reserve that can be called upon: excess costs will be cut. no mâtter how well the institutional framework within which they function is tlesigned. while alw¿ys conspicuous in some are¿Ìs. is hardly in undisputed commanil everywhere and at ali times. frrms. imbalances. but that it is cor¿. surplus-producing societies. a blessing in disguise.Exit. it is impersonal face-to-f¿ce confrontation between customer and -any 15 . t4 See belov¡./ tíw. eficiency. who point out that it permits firms to ride out adverse market or other developments. This radical pessimism. Exit belongs to the former realm. categories of exit and voice would be suspiciously neat if it did not faithfully reflect a more funtlamental schism: that between economics and politics. shifts to that of another. our inquiry bifurcates.ouslg being genera. and Loyalty Quite a different reaction to the cliscovery of slack occurs when the discoverer asks himself." could be its motto. Introduction and Doctrinal Backgtound world ¿nd exists in given amounts. and he also sets in motion market forces whieh rnay induce recovery on the part of the firm that has declined in compar¿tive perfor"rnance. more radical step in recognizing the importance and pervasiveness of slack. The customer who. functions was put forward by Cyert and March.ls The immediate response to the discovery of slack has thus been either to assert the rationalíty of a certain level of slack or to look for ways of extirpating excessive levels by invoking exogenous forces such as adversity. It assumes not only that slack has somehow co¡¡ìe into the 18. to a gtadual loss of rationality. The ide¿ that slack fulfills some impoitan! if unintended or latent. as alreâdy explainerl lts breakup into the two contrasting. generates its own cure: for as long as decay. that is. dissatisted with the product of one frrm. 31-32. whether slack may not after all be a good thing. Both these approaches look at slack as a gap of a given magnitude between actual a¡rd potential performance of individuaÌs. Slack in the political system has been rationaiized in a very similar m¿nner. "There's ¿ slacker born every minute. and so on. Exit and Voice as Impersonations of Economics ancl Politics In examining the nature and strength of these endogenous forces of recovery. though not mutuaþ exelusive. innovations that were already within one's g:rasp wili at last be introduced. which views decay as an everpresent force conståntly on the attaek. This book takes a further. more aggressive sales behavior that had been shunned will nov¡ be engaged in. The discovery that citizens do not normally use more than ¿ fraction of their political resources came originally as a surprise and disappointment to political scientists who had been brought up to believe that democracy requires for its functionìng the futlest possible participation of all citizens. uses the market to defend his welfare or to improve his position . voice to the latter. During such bad. revolution. this is the sort of mechanísm economics thrives on. pp. and so on. ancl organizations. lt is neat-one either exits or one does not. after having got over his initi¿l shock. Voice. it is likely that the very process of decline activates certain counterforces.

Clearly. A particularly good illustration of this bias appears in a well-known essay by Milton Friedman which advocates the introduction of the ma¡ket mechanism into public erlucation. one major.:#l & .. if problem-plagued. 2:32-37 (June 1968). The economist tends naturally to think th¿t his mechanism is far more efficient and is in fact the only one to be taken seriously.The Failure ol the Public Schools and the Free Market Remedy. 91. Significantly. for it has been labeled desertion. and it is indirect recovery on the part of the declining firm comes by -åny courtesy of the Invisible Hand. Freedorn (Chicago: University of Chicago Press. however "cumbrous. Levin. In justifying this scheme he says: { t r \ å ä ø ã . The italics are mine. a "trained incapaeíty" (as Veblen called it) for perceiving the usefulness of one of our two mechanisms. In all these respects." is all their members normally have to work ¡vith. defection. "secret" vote in the anonymity of a supermârket.ticø) chan- *1 ï¡l nels. to a much greater extent than is now possible. 6 and the citeal Þassage appears unchanged on p.v * . The essence of the Friedman proposal is the distribution of special-purpose vouchers to parents of school-age chiidren..J. in the politicai realm exit has fared much worse than has voice in the realm of economics. it implies articutation of one's critical opinions rather than a private. Rather than as merely ineffective or "cumbrous.s bias in favor of exit and against voice. 129. 1955). it is direct and straightforward rather than roundabout. ¿.I:i. The Urbøn Eeaieu. Econonuics ønd the Public Intel'est (New Brunswick. In general they can now take this step only by changing their place of residence. by withdrawing their children from one school and sending them to another. thea can erpress tlteir aiews onlg througlt cumbrous poli. "The Role of Government in Education. Voice. and hopefully the slow improvement of these very channels ? In a whole gamut of human institutions. and indeed the democratic. In fact. N. and Loyalty firm rvith its imponderabìe and unpredictable elements is avoided and success and failure of the organization are communicated to it by a set of statisties . ed.irectla.É & å $ $ 'å' & Parents could express their views about sehools d.Ls 19. and finally.: Rutgers University Press." But what else is the political..'. â:.snr (rnÅ. voice is just the opposite of exit. å Introduction and Doctrinal Background I am not interestecl here in discussing the merits of the Friedman proposal. I am citing the above passage as a near perfect example of the economist. In the frrst place. But the economist is by no means alone in having a blindspot.4. 17 . For a good discussion see Ilenry M. For the rest. with these vouchers the parents couid buy educationai services that would be supplied in competition by private enterprise." in Robert . voice. A revised fordr of this essay was included in Friedmaî's Cøpite. as an unintended by-product of the customer's decision to shift. effort presently underway toward better public schools in the iarge cities is to make them more responsive to their members: decentralization has been advocated and unde¡taken as a meâns of making the channels of communication between members and management in the public school systems less "cumbrous" than heretofore. the use. process than the digging. Solo. It is ¿ far more "messy" concept because it can be graduated. all the way from faint grumbling to violent protest.2o Rather. from fhe state to the family. passions and preconceptions must be reduced 20." exit has often been brandecl as crimhnl. 1962) as ch. p. A person less well trained in economics might naiïely suggest that the direct way of expressing víews is to express them ! Secondly..t Exit. Friedman considers withdrawal or exit as the "direct" way of expressing one's unfavorable views of an organization.nd treason. t*. the decision to voice one's views ¿nd efforts to make them prevail are contemptuously referred to by Friedman as a resort to "cumbrous political channejs. 16 #. Voice is politicai action par excellence.

it being understood that the laissez-faire ådvocate's forces of goocl are the interventionist's forces of evil and vice versa. Voice. whereas both laissez-faire and interventionist doctrines have looked at market and nonmarket forces in a strictly Manichaean way.cal concepts. Perhaps it . that is. . this necessariiy conscious.22 process is not These views do not imply.e Strategg of Economic Deøelopment was based: Tradition seems to require that economists argue forever about the question whether.rket f orces are not necessar¿Iq less " wtomøtic" th. 53:947 (December 1963) .an tno. A close look at this interplay between market and nonmarket forces will reveal the usefulness of certain tools of economic analysis for the understanding of political phenomena.ceú. ¡vhen the market fails to achieve an optimal state. From this point of view. p.zirLly and the Econo¡nics of Medical Care. that is. . StralegA. and nonmarket social' institutions 21. possibly also in such a fashion that one gets into the other's way ând undercuts its effectiveness. This reciprocity has been lacking in recent interdisciplinary work as economists have claimed that concepts developed for the purpose of anâlyzing phenomena of scarcity and resource ailocation c¿n be successfully used for explaining politicat phenomena as diverse ås power.Exit. 63. in any disequilibrium situation. have been introduced as trtro principal actors of stricdy equal rank ancl importance. to econonzists the usefulness of politi. political mechanism work side by side. and Loyalty on both sides if advantage is to be taken of an exceptional oppodunity to obser-ve hotv a typical market mechanism and a typic¿I nonmarket. market and nonmarket forces. But they leave room for a conjunction-which could quite possibly be inadequate----of these tr. Now this is certainly an interesting question.vo forces. Ðven more important.Welfa¡e 22. ¿nd nationalism. as both Arrow and I immediat€ly hastened to add. In developing my play on that basis I hope to demonstrate to political scientists the usefulness of economic concepts anl. democracy. or by both acting jointly? It is ow contention that noru?Ll. "fJr.'. and. mnrket forces øcting olone are likely to restore equilibrium. 18 Introduction and Doctrinal Background will arise attempting to bridge it . recognize the gap. society will. Kenneth Arrow has argued along very similar lines for movements from less-than-optimal to optimal states: I propose here the view thåt. A final point. Itaiics in the originaì. that any disequilibrium or nonoptimal state whatever will be eliminated by some combination of market and nonmarket forces. They have thus succeeded in oecupying large portions of the neighboring discipline while politicai scientistswhose inferioriþ complex vis-à-vis the tool-rich economist is equalecl only by that of the economist vis-à-vis the physicist-have shown themselves quite eåger to be colonized ancl have often aetively joinecl the invaders.r ket f or c e s. economic and political mechanisms. Exit and voice. Amærican Econcrmic Review. possibly in harmony and mutual support. Hi¡schman. the analysis of this interplay will lead to a more complete understanding of social processes than ca¡r be afforded by economic or political analysis in isolation. by market or nonmarket forces. 19 . Nor do they exclude the possibility that the to sets of forces could work at cross-purposes. this book can be viewed as the application to â nerv freld of an argument on Ìrhich much of Th. to some extent at least. But as social scientists we surely must address ourselves also to the broader question: is the disequiiibrium situation likeìy to be corre¿ted at all. oice aersa.2t I was concerned here with disturbances of equilibrium ¿nd the return to it.

20 $.l Most authors ¿re content 'lvith general references to its "pressures" and "disciplines. in the iatter capaeity. Which $¡as carried out by David S' French' 2L . Voice. to judge from a determined though inevitably fragmentary search of the vast literature on competition. #. # * É * f & & ffi & ffi ffi jå ä: '. this neglect of what could be considered one of the principal virtues of the "free enterprise system" mây be particularly surprising. Nevertheless the precise modus operandi of the exit option has not reeeivecl much attention.f Exit. but rqtronnemer?¿ as well? I like to think that this could be a by-product of the present essay. the exit option is widely held to be uniquely powerful : by inflicting revenue losses on delinquent management. that firm must ipso facto be assumed to be mortally sick and to be ready to leave the stage while some vigorous newcomer is presumably tvaiiing in the wings to take its place' This "view of the American economy es a biological process in which the old and the senile are continu¿lly being replaced by the young and the vigorous.âli A The avaitability to consumers of the exit option. where the flrm has competitors but enjoys some latitude as both price-maker and qualitymaker-anal therefore. should such a failure nevertheless occur in the c¿se of some firrn. aìso as a qu¿lity-spoiler. As already mentioned." Insofar as the apologetic literature is concerned. exit is expected to induce that "¡ponderful concentration of the mind" akin to the one Samuel Johnson ¿ttributed to the prospect of being hanged. and Loyalty 2 Exit takes an economist to reawaken feelings of identity and pride among our oppressed colìeagues antl to give them a sense of confidence that their concepts too have not onìy grand.eur. but some of the reasons for it have already been suggested' Those who celebrate the invigorating qualities of competition are loath to concede that the system couÌd fail for even a single moment to make everybody perform at his peah form. ancl theit' frequent resort to it." as Galbraith puts it mock- iffil ffi. are characteristic of "norma1" (nonperfect) competition. &r 1.

tat:ísm : The Çoncept power (BoslorLi lloughton -K"11n*\Czlhraith Mifün Co.a Secondly. with the difference that quantity bought is made to depend on changes in quâlity rather than on price. the sentence cited j"_log4. the more massive the exit the greater the losses following upon any given quality drop.ã. '#.vounten)a¿txng . the effect of quality decline on revenue..ilä"råËi'ää" that "anotheï thíng deiired i" tr.normal" lead firms back to efrciency.oã.. In the former case.. in their eager_ ness to stake extravagant claims for their system. Perhaps the simplest way to visualize such a relationship is as a discontinuous threevalue function. p. aï-itr... performance.. p. anal Loyalty Exit ingly. if rather inconclusivelg scru_ tinized...cøn .possib. management undertakes to repair its failings. No reaction occurs for a small drop in revcosts 4. But.. two difierent scales-some measure of quality antl money-are divided into one another. .result in an efrcient allocation of resources within a static framework. has been very largely concerned with discussing the con_ ditio¡s under which competitive market struãtures re_ sult or faii to.unpteasa¡tselicesà"-. 22 # å ff $ W.. whereas in the case of price increases total revenue falls of course only if pzicø-elasticity of demand is gre¿ter than unitv. on the part of the firm. as far as I have been able to ascertain. there exists a management reaction function which relates quaiity improvement to the loss in salesupon finding out about customer desertion... & & * * å å * "&.. The technical economic literature. no study.":.. X.[ T *. total reYenue declines wheneve¡ lln'e quøLity-elasticity of demanil is greater than zero.. :.Joh¡-Mau¡ice Clark. in its lower portion. has been made of the related topic of competitionÈ abiiiiy to . which also shows. Brookinss Instilution. Just as quality is normally assumed to remain unchanged when the effect of price changes on demand are considered. ÈBangety.llimination of Inefrcieût Elements.î"-ätitiå". It would seem thai the apologists of competitive enterprise have missed.ri^'ão.d. theoretical or empirical.ü: ç Exit.le. does mention -ää. This is done irn Appendix A.. any numerical measure other than ze¡o and inûnity is the ¡esult of arbitrary scaling.1ùi. 81.ãt bá-Wi^'ñä"t uompetrhon to llo fo¡ Us?.petition øs a Dynøtnic p"""r"" iWå"ïiîJ"ì. and. Voice. Hence.# Cq¡ti. namely.'Cla¡k dealt at some lenEth with what he considered io be the ten principaL i"". ¿. Costs also remain constant. The response of demand and ¡evenue to quality changes can be graphically represented by mea¡s of a demand cu¡ve with the familiar dow¡ward slope if the ve¡tical axis of the traditional diagra:n is made to measure quality deterioration ¡athe¡ than pdce increase. 1961). One nonstatic aspect of com_ petition has also been amply.dom lapse in emciency rather than from a calculateal attempt..ã"" ¡n seerng'-to jt that faltering ûrms a¡e liquidated rathe¡ ihaa restored to health. systematic or casual. for by definition the quality decline results from a r¿m. This diagram makes clear that the effect on total tevenue of a decline of demand caused by quality decline is much simpler-and more damagingthar that caused by price rises.. øøE exit whatever of consumers in response to quality decline will result in revenue losses . to reduce by skimping on quality. which deals" p-rirnl-rlvwiththe. Whereas an increase in price can result in an increase in the fl¡m's total revenue in spite of some customer exit. onã of the more substanti¿i points to be m¿de in its favor. 4å tr & &" ffi familiar demand function. on the other hand. The first one is a variant of the ^"2. revenue can at best remain unehanged ¿nd will normally decline steadily as quality drops. IJnder these conditions. so it is now convenient to assume that price cloes not change when quality drops.-.ä.^{9-lI_ oI w . and gro'wth standards after they have lapsed from them.ä'"i secrron enu ed "¡.) 23 . the rescue of faltering ûrms is not among "? thãm."p"lìtïoî visiìant to eliminate inefÊciencies of p"". (Unit elasticiþ of demand has no precise rneaning in the case of qualityelasticity."f.. who had a most lively sense of the multi_ prlcrry o1 ïunctrons competition is expected to pedorm..2 does not leave room for sho\ying how competition helps to cure the temporary and remecliable lapses whose importance is stressed here. figure 2. almost as an afterttroughi.." Com. its aptitude to generate innovation and growth. 1956). in ch.l. When the concept of "quality-elasticitv of demand" is put together in a¡alogy to p¡ice-elasticity. ff # ff s .3.. s: È q R & di.iiã"".ã i"ås"" have so depleted their Ìesoùrces as to make rõfrr¡ilitäiio"-ãijfr""rt or im.s IIow the Exit Option Works The conceptual elements needed for such an exploration are straightforwarcl. Amet ì. of course.

According to traditional notions.'For the recuperation potential of the firm to come into play. which is intuitively evident can also be phrased as follows: r'or competitior. in perfect competition (which includes perfect consumer knorvledge as one of its many exacting assumptions) the firm is not deprived of an effective correction mechanism bec¿use performance deterioration.s $ * f #. the world of quasi-perfect competition is not. it is therefore desirable that quality elasticity of demand be neither very large nor very smalì. then again. but one râther far removed from it.¿¿¿¿-cusmìnef *Th-eãIe¡trusiõners provide the frrm with a feedback mechanism v¡hieh starts the effort at recuperation while the inert customers provide it with the time and dollar cushion needed for this effort to come to fruition. But if demand is very elastic. is reflected direetly in a decline in revenue (due to increasing costs). no recuperation ensues-beyond a certain poínt. In other words. It'would be easy to think instead of a continuous ¡eaction cu¡ve. this time because the frrm will be wiped out before it will have had time to find out ¡¡¡hat hit it. while the perfectly competitive world is a feasible one from the point of view of an effective recuperation mechanism. Consideration of competition as a recuperation mechanism reveals that. the more ¿lert the customers the better for the functioning of competitive markets.Exit. o. ¡vhich cannot possibly affect either quality or price. If there is to be a drop in quality it is desirable that it be of the size which leads to recuperation. and Loyalty å enue. and. the concept of a firm with no latitude as to quality whatever. the ¡eaction rtrould turn into ¡einforcement as demo¡alization and other results of ûnancial stringency would compound quality deterioration and thus hasten the fi¡m's dow¡fall. Such a shape of the reaction function vr'ould not change malerially the points that will be made in the lext. the flrm rvould come to produce at qualities superior to the ones at which it started out-to that extent one might speak of a point of . then performance deterioration can (and is perhaps likely to) t¿ke the form of quality decline ancl if the ma¡ket in which the firrn sells is highly competitive. 5. then the optimal årrangement is not one as close ¿s possible to that of perfect competition. as a result of the teaction. and incremental moves in the direction of perfect competition are not neeessarily improvements-the argument of the second best applies here in full force. the recuperation process will not take place either. At a Iater point. full recovery folÌows upon a drop of intermediate size. # & 25 . Evidently if demancl is highly inelastic rvith respect to quality change.1 . revenue losses will be quite small and the firm will not get the message that something is arniss. If one gives up. a r @e-orø¿çz¿-¿n¿. much less to do something about it. But assume now a small departure from the perfecUy competitive model so that the firm has some latitude in varying quålity.& Exit of course.fl ä å T * . disastrous instability might result and firms would miss out on chances to recover from their occasional lapses. Voice.. that is. *: '& . a1though exit of some customers is essential for bringing the mechanism into play. losses will weaken the firm so badly that bankruptcy will occur before any remedial measures can take effect.. quality decline : if all were assiduous re¿ders of Cor¿su. in quality.mer Reports. or deter"rnined comparison shoppers. Remedial action would be small with small sales losses a¡d would the¡ increase and l¿ter decline. This proposition. too soon. beyond a ce¡t¿in loss in sales. Thjs is a câse of "too much.'r*t .. or unperturbed by. fulì of highly knowledgeable buyers. it is senerally best for a firrnJõTave formance lapses..$'l & w w: #.{*i . if the revenue decline exceecls a cer_ tain large percentage of normal sales volume. å *l å gj . It is even conceivable that.g w .optimal deterioration. the firm ¡rill be competed out of existence in very short order. it is important that other customers remain una\ryare of.l ("¡t) to *ork a -" cuperation from per". As has already been noted. as he must in most real cases.ã The interaction between the exit function ancl the reac_ tion function can now be described.

. This argument is explaiaed more fully below. Needless to say my Falcon is the last of any Ford p¡oduct f would conside¡ to purchase. . A competitively produced new product might reveai only through use some of its faults and noxious side-effects. To help him judge I should like to provide some sample passages from letters recently fired off. and (ö) to the General Moto¡s Corporätion: . This is even more the case if the most determined comparisoa shoppers are those who would make most t¡ouble fo¡ the manufactu¡e¡s if there we¡e ao possibility of exit. . 7. The reader c¿n judge whether elements of the foregoing situations can be detected in the economic and commercial life around us. ancl a merger of all firms would appeâr to be socially desirable is. At home we have a Chev¡olet bus and a Chev¡olet van. however. and Loyalty Exit å Competition as Collusive Behavior r $ No matter what the quality elasticity of demand. But why would a firm whose output deteriorates in quality alLraet any new customers at all ? One can actually think of a situation in which this seemingly quite unlikely event would come to pass : when a uniform quality decline hits simultaneously all firms of an industry..'.. when there are other tJrings in this q¡o¡1d where the money could be put to much bette¡ use . the manufacturers have â. . . a slight modification of the previous situation serves to endow it with greater realism and relevance. exit could fail to cause ¿ny revenue loss to the individual firms if tlte fi. Competition in this situation is a considerable convenience to the manufactu¡ers 26 T å i å * å À ð * --. You mav be absolutely ffi * # & o4 atl . all equaily faulty.ç''r Exit.. The competitive mechanism then ¡ids manageûrent of its potentially most troublesome custome¡s. eâch firm would garner in some of the disgruntled customers of the other firms while losing some of its previous customers to its competitors. But even if this premise is droppetl." that is.it loses tl¿e old. who has depleted her bank account buying Falcon transmissions. and hence for delay in bringing pressure on manufacturers for effective improvements in the product. for customer dissatisfaction would then be vented directly and perhaps to some effect in attempts at improving the monopoly's management whereas under competition dissatisfaction takes the form of ineffective flitting back and forth of groups of consumers from one deteriorating firm to another without any firm getting a signal that something has gone awry.. . reasonably attractive. it diverts their energlr to the hunting for the inexistent improved producls that might possibly have been turned out by the because competition. 6.lemons.6 The argument presented so far maintained the premise that the unsatisfactory features of the product turned out by the various competing firms could be eliminated as a result of pressures and a resultant search for solutions. neu customers os. consumers rvould learn to live with inevitable imperfection and would seek happiness elsewhere than in the frantic search for the inexistent "improved" product. You can be assu¡ed that I will aot purchase anothe¡ Ford of any kind no matter what you¡ usual fo¡m letter to me will say .? A few comments may be in order. For the presence of a number of competing firms fosters in this case the perpetual illusion that "the grass is always greener on the other síde of the fence. Voice. it keeps consumers from complaining. (ø) to the Fo¡d Motor Company: '¡. Under these circumstances. .rm acquired. .s # .. In these circumstances the exit option is ineffective in alerting manâgement to its failings. I am a youag girl of 25.èl'. While a simultaneous and uniform deterioration of all frrms in a certåin type of business is of course highly unlikely.ffit å. .. Under monopoly. In this case the claims of the various competing producers are likeiy to make for prolonged experimenting of consumers with alternate brands..". monopoly would replace competition to advan-th¿t tage. that an escape from defectiveness is possible through purchase of the competitor's product. common interest ín the m¿intenance rather than in the abridgement of competition-and may conceivably resort to collusive behavior to that end. . . the competitive solution may again be inferior to one in which a single flrm is the sole producer. ones. by i¡ate owrte¡s of .

Radical critics of societies with stable party systems have often denounced the competition of the dominant parties as offering "no real choice. w & $ $ & 28 #i 29 . one can sureìy conceive of circumstances under which it would turn into a liability. product of any kind on my d¡iveway . American Federation of Labor and Congress of Industriai Orga¡izations.ations other than business ûrms. and that to this extent competition and prod-ûõrdìiêismc¿Eoä is-@ily when. Nevertheless the radical critique is correct in pointing out that competi- K 'w divert what might otherwise be a revolutionary ground swell into tame discontent with the governing party. Conslitution of the AFL-CIO (Washington. #.&i g w AFL merger of 1955 was the No-Raiding Agreement which was concluded between the two organizations trvo years earlier. January 1956). on the relevance of the preceding notions for orgar. . auto and wagon for many years nolv but maybe FORD has a better idea. AFL-CIO Publication no. It was found that most petitions were unsuccessful and that those which were granted were about equally divided between CIO petitions to displace an AFL union and AFL petitions to displace a CIO union. that such changes are desirable) . '. 36. t that the dis'advantages of exit-com s case its per g advantages the assumption @ 8. con"sumers would either bê abie to biînE nioiã-êlÏãcïìîe nre¡surel upon manaseññt toward eneror would sto will that competitive political å iå * & ." It is of course ¿ very open qìtestion whether." Copies of the lettêrs from which these excerpts a¡e taken were mailed by their authors to Ralph Nader who has kindly màde them available to me. .i?. "compel the conclusion that raids between AFL and CIO unions are destructive of the best interests of the unions immediateiy involveil and also of the entire trade union movement. so the report says. Voice.C. and the desirability of devoting the energies of the trade union movement to the organization of unaffiliated workers rather than to raiding. for the sake of the argument. I g # *' æ & & 'w.M. p. addressed by CIO-AFL unions to the National Labor Relations Board for certification as the ofrcial bargaining agents in industri¿l plants. '&. successful or not.a be å systems s' w have frequently been portrayed in just these terms.. The text of this agreement referred to a statistical study of all petitions over a two-year period. in-lts ãbsence. I'I1 try to put up with this LEMON tiu the '?0 models come ouq but you can be sure the¡e will be no G. in the absence of the competitive party system. Exit. the document cites unrest and disunity createcl among the workers as a result of the raids. and Loyalty #. #' . . I am indebted to John Dunlop for the reference and fo¡ discussing this point with me. D. G. A preliminary step to the CIO- . The basie point is that rå.ä '#) Exit .M. A less speculative illustration of the issue under discussion can be drawn from the history of the trade union movement in this country.' tive political systems have a considerable capacity to sure that after all of this trouble and inconvenience and r¡¡asted time shall never own a General Motors product again . Although this capacity may normally be an asset. 2." 8 As reasons for this conclusion. citizens woulcl be better able to achieve fundamental social and political changes (assuming. I have had a.. 'Ihese results." '. ü gg-p:titign@gover of each othets' customers on the part of a group of comng firms .

policies. either as a. The very idea that this is another . As before. But voice is like exit in that it can be overdone : the cliscontented customers or members could become so harassing that their protests would at some point hinder rather than help whatever efforts at recovery are unclertaken.. Powell. Just as in economics it had long been thought that the more elastic demand is (that is. It is the¡efore both legitimate and timely to examine the conditions under which the voice option is likely to make an effective âppearånce... "U state "h"on". Voice is here d"finud r.3 Voice Voice have long dealt systematically with this function and its various manifest¿tions. on the one hand. rather than just go over to the competition. an objectionable of affairs. Nothing remotely similar can be said about the voice option. B. Brown and Co. For reasons that rvill become clear this is most unlikely to happen in relations between customers and. which affirms that the choice is tw neutral terminologlr. and outputs of the firm from which one buys or of the organization to which one belongs.y rff"-pt . complement to exÍt or as a substitute for it. -TirgtG as compared to that of exit. while economists have refused to consider that the discontentecl consumer might be anything but either dumbly faithful or outright traitorous (to the flrrn he used to do business with) . up to a certain point. so it has long been an article of faith of political theory that the proper funcion31 . 30 zation which is remediable provided the attention of management is sufffrciently focused on the task. whether lescape I through-TrìdivÍdÌãf-o'r co1'lèltive-T-e-fitÍõñ-to-the manI agement directly in charge." t Political scientists ].recuperation mechanism" which can come into pìay alongside. Fot a ¡ecent treatment in a comparative perspective see G. that voice is nothing but a basic portion and function of any political system. Co1tupø. ch. then the effeetiveness of voice will increase.t to . through appeal to a higher iauthority with the intention of forcing a change in manj agement. the more rapidly exit ensues whenever deterioration occurs) the better for the functioning of the economic system. Yet.th)e Politícs: A Deøeteym. business firms. is for the customer or member to make an attempt at changing the practices. ' including those that are meant to mobilize pubiic opinion. the exit option is iikely to be met with a mixture of incredulity and raised eyebrows. It is becoming clear. To ¡esort to voice. known sometimes also as "interest articulation. can . If conditions are such that the decline leads to voice rather than to exit on the part of the discontented member-customers. 4. the initial assumption is a decline in the performance of a firm or organi- If the exit option has not been investigated in detail by economists.ro.kick up a fuss'. consumers (or members of an organization) . but in the realm of politics-the more characteristic province of voice-the possibility of negative returns to voice making their appearance at some point is by no meâns to be excluded. Almond and._ G. from.entøl Approøch (Boston: Little. it has become quite apparent that dissatisfied. its existence and effect on performance-generally presumed to be wholesome-nevertheless underlies many judgments and attitudes toward economic institutions. as was already pointed out in the introductory chapter.. rather than exit. on the other. and thereby force improved quality or service upon delinquent mânâgement. r. or through various types of actions and protests.u {M . A niche thus exists for this book. An interesting parallel appears here betrveen economics and exit. A. 1966). with its volume. remarks on the wo¡king of voice in isolation. or in lieu of. in this age of protest. Jr. and politics and voice. But in doing so they have ordinarily confined their attention to situations in which the only alternative to articulation is aquiescence or indifference (rather than exit).

the citizen must express his point of view so that the political elites know and can be responsive to what he wants. for long periorls of time.J.ern Potiti. 1959). Who Goaerns? (New Haven: yale University Press. permanent activism or total apathy. The essential reãsoning behind this thesis is quite simiìar to the argument made earlier on the need for exit to stay within certain bounds. 6 for dáta and principal ff. is that the ordinary faiiure. but the mixture of monopolistic and competitive elements characteristic of most real market situations should make it possible to observe the voice option in its interaction rvith the exit ontion.organizalional :l?"k"_! the economic system.B According to another line of reasoning. either exit or voice wiìl ordin¿rily have the role of the d. Tie Ci. on the part of most citizens. si *. this belief was shahen by empirical studies of voting and political behavior which demonstrated the existence of considerable political apathy on the part of large sections of the public.nant teaeLion mode." Pol'itinøl Life (New York: Free Press of Glencoe. Gab¡iel A. but.2 Since the <iemocratic system appeared to survive this apathy rather weil. the democr¿tic political system requires "blending of apparent contradictions" : on the one hand. Dahl. ancl vocal public.. #) rs: $ # & ffi &. the state. tr ñ s. aA_SA. . p. that exit and voice will always both have positive effects at first and destructive ones at a later stage. As in the case of exit. it is difficult to conceive of a situation in which there woukl be too much of it. and Loyalty ä Voice '&. The citizen must thus be in turn influential and deferential. * 3. some time to respond to the pressures that have been brought to bear on it. these elites must be alloivecl to make decisions. Inc. This does not mean. in certain respects. This pcint is remarkably similar to the o_ne -ma{e by March and Cyert about the virtues of '. See ?he Behøøiorøl Theorg of the Fìmø^(Englewood Ctifs. 1966). Robe¡t A. The subsidiary mode is then likely to show up in such limited volume that it will never become clestructive for the simple reason that. Inc. the job of destruction is accomplished single-handedly by the dominant mode. In the case of normally competitive business firms.aic. One reason. |ü sources. pp. for example. DahI. Almond and Sidney lerba.: Prentice-Hall. to use their potential political resources to the full makes it possible for them to react with unexpected vigor-by using normally unused. on the other. 1965).. Finally. pp. if deterioration proceeds. ing of democracy requires a maximally alert. w.1$ :si . may actually serve democracy better than either total. stressed by Robert Dahl. a mixture of alert ancl inert citizens. ä ffi. Voice has the function of alerting a firm or organization to its failings. ic & & # #. old or new.g Exit. A simila¡ thousht iÀ expressed bv_Robert ljne who-shows that.å Ë ff . then. 1968).-.:åli #r Voice as a Residual of Exit The voice option is the only way in which dissatisfied customers or members can teàct whenever the exit option is unavailable.mocrøcy in îù. or even ¿n alternation of involvement and withdrawal. prorqr an{ Co. . In the United States. pp. it became clear that the relations between political activism of the citizens ¿nd stable democTacy àye considerably more complex than had once been thought. 338*844.orwi. C1ifs. active. ch. 309-310.cøI AnøIytis (Engìewood k v w ç . exit is clearly the dominant reaction to deterioration and voice is a badly underdeveloped mechanism. &r.a __?a See Robert A. however. Mod.bne can assign diíf€rent political ¡oles to t}re political activists and the indiferents and that a balance between the two can achieve beneficient ¡esults. give management. 845. but it must then s.e Nøtions (Boston: Litde. 4. i*-: #. the theoretical construct of pure monopoly would spell a no-exit situation. In the economic sphere. the relation between voice and improvement in an organization's efficiency has considerable similarity with the modus operandi of exit.. In the case of any one particular firm or organization and its deterioration.ti. This is very nearly the situation in such basic social organizations as the family.-Culture: Po¿i.: Prentice-Ilal1. Voice. De. N.cùl Athitudes ønd.J. Inc.. N. or the church. 1961). reserves of political power and influence-whenever their vital interests are directiy threatened.

the voice of the nonconsumer on whom "off"rîrorrih"*. the atmosphere in the for_ mer countries is more suffused with loud.mer too has a ¡ole-to pfäv i"-ão -p-fãÁã"ting the mecharrimr. Voice w # #i . and so forth). up to the point where.. Similarly. ive shall assume that exit is the dominant re¿ction mode. the possibility of voice having a destructive rather than constructive effect may therefore be excluded. on the quality eiasticity of demancl.rnmt to exit. &' # # & å # . the role of voice wouÌd increase as the opportunities for exit decline. as. to derive an aggregate recuperative effect. Voice may cause direct monetary losses to the firm. The other determinant of voice is of course the degree of discontent of the nonexiting customer which depends roughly on the degree of deteriora- tion..¿s ¿ìubrtit. voice can be viewed as a residual. tf. -ã#". or on the lack of opportunity for exit. the disecon_ omies are inflicted could become a valuabìe adjunct ø tfr" tjve mechanism.o""i ia"Jifrrt the most serious impediment to the hòpe. for example.s iã. & w advanced economy."ä"ì tu trrài" is a net gain from the point of view of the recuperation "*ãiu.fff* Ërmn-âtæaÍóiæ f*rh-"il. noi ."jji!"-"} l¡tterrng ot beaches with beer cans.here dissatisfaction is more likely to take the form of silent exit. mechanism. The relationship between the volumes of exit and voice that is indicated here is spelled out in more formal terms in Appendix Ä. it was fountl necessary to give voice a more prominent role. often politically colored protests against poor quality of goods or services than it is in the advanced countries v.#r * K å ffi. ff ffi' $ # # w & clandise. then its likely efectiveness in making u" i^pr"""ià" ã". like exit. But the direction of the relationship is turned around: with a given potenti¿l for articulation. Therefore. these diseconomies could be contai¡ed o.. -If -voice appears exclusively in this particular i""rÀrii"". the actual level of voice feeds on i. Turning now to the reaction function. these nonexiting customers are therefore the source of the voice option. fn a preliminary appraisal of the eombined effect of exit and voice.. p""rruntuJ' tfrro"ãf.. they ¿re likely to experience different degrees of unhappiness about the quality decline' Being presumably endowed with some capacity to articulate this discontent.--Voice could usefully complement competition also in a rno¡e lamrl¡ar context.u ã"i"turr"" diseconomies in production and consumption tpolliUon. Voice.ê. .ã.. to the effect of voice on recuperation of efficiency on the part of voice-exposed management. Economists who have hopefully eyed competition. Obviouily. Whoever does not exit is a candidate for voice ancl voice depends.nelastic demantl.. nor between as many varieties of the same good." -"rrp.äl f # .ü"" añiculation of protests on the paït of ìhose who ln other $/ords.""scious managers can be precisely meaiured ajainst th.s aùility to allocate ¡esou¡ces efrciently have g"""iufiv .w $ Exit.s fuìfiiheni i.€ Both the propensity to protest and the effectiveness of complaints vary widely from one firm-customer complex to another.i oi s"" Àppendi'< A. Whiie they are not yet reâdy to desert the firm. voice function-i asã co¡npl-e. Once this is ¡ealized it is pe. but look now at those who continue âs customers.ha. . first approximation. ""ii.6 In this view. voice must carry the entire burden of alerting management to its failings' That such a see-saw relationship between exit and voice exists in fact In a to some extent is illustratecl by the many complaints about quality and service that h¿ve been prominently published for years in the Soviet press. nor between as many ways of traveling from one point of the country to another. But three gene¡al statements can be made: ( 1) In the simple model presented up to now. as in an 5. that is. when dissatisfied co¡sume¡s are able to turn in aeiecüve ¡ler_ ffi #. With exit-competition playing a much smaller role in the Soviet economy than in the market economies of the West. voice is in a much more commanding position in less developed countries where one simpiy cannot choose between as many commodities. Obviously sales losses and com_ plaints or protests of those who remain members are not easily added. and Loyalty We return to the simple relationship between deterioration of a product and tleelining sales.e consu. with exit wholly unavailable.ilirg "ãÃpìti_ that the voice oi t}. _ ?.? 6. then..

because of the budget constraint. be more appropriate to put matters in this way. Eventually. the decision whether to exit will often be taken in the lisht pf_the g!o. quâliff-elasticity of demand. the voice option is more likely to be taken at an early stage. of t . Hence. The reason for rvhich even such a pattern may be too much weighted by exit will be commentetl on at some length in Chapter 4.K Exit.. an important component of the voice option consists in this decision to continue as a customer of the deteriorating and now inferior product (or as a member of the deteriorating organization). as quality becomes abominable. does it possibly occur to them to make a fuss. however. Voice. but there may well be a number of goods and services whose demand will move from qualityelastic to quality-inelastic for a wide range of quality declines. being impaired. then. the optimal pa!tern from the nojnt of vieiv of maximizing_lhe combined effectiveness of exit and voice over the whole orocess of '{éteriõiãflon mayTe an elastic response of demand to the anããlinelasuõ onãJor ttre @ consumer responses to price incre¿ses for certain commodities which are vitally needed in limited quantities even at high prices. but not vice versa. then they may well postpone exit. for if deterioration is a process unfolding in stages over a period of time. (3) Considering that beyonal a certain point. a decline in quality ffi & tr & & # ffi ffi ffi ffi w & & ffi ffi ffi ffi & first decide rvhether to shift to another firm or producf regardless of their ability to influence the behavior of the firm from which they usually buy.f or tlæ eff ectiae use of a oi. especially if the only aiternative available for a deteriorating product is a higher-priced substitute. under what conditions will a customer of A fai. because of the deterioration of . that voice can be a substitute for exit. exit will therefore be a reaction of lost resort after voice has faiied. in some situâtions. What are the conditions.I to go over to B? Once voice is viewed as a substitute for exit. It appears. you have lost the opportunity to use voice.ce. and Lo¡'¿]fy Voicc (2) The more effective voice is (the effectiveness of exit being given). only if they do not shift.s2_9-ql. therefore. for it will presumably be taken only by those who wish for and expect. B is now clearly superior fro¡n the point of view of A's customers.4 to recover its original superiority over -ts. Once you have exited. exit has a destructive rather than salutary effect. can also be viewed as depending on the ability and willingness of the customers to take up the voice option. It may. when price increases indefinitely). Ordinarily. If the matter is put in this way it is immediately ev! dent. the treatment of voice has suffered from a certain timidity: the new concept has been viewed as wholly subordinated to eút. See Appendix B for a mo¡e technieal discussion of the topics treated in this section. In judging the volume of voice to be determined by the quality elasticity of demand. as well as a complement to it.4. in fact. Voice as an Alternative to Exit 8 Up to now. but whose consumption rvill easily expand beyond this point if prices drop. the more quality-inelastic can demand be without the chances for recuperation stemming from exit and voice combined. demand will vanish (just as it does. one implicitly assumes that customers who are faced by 8. If customers are sufr ciently con-vincèdTñãtïoice ìil-l be effective. a customer or member will undergo the sac- . It may similar1y apply to quality eìasticity of demand. and not necessarily by all of them. of course. under which voice will be preferred to exit? The question can be formulated more preeisely as follows : If a competing or substitute product B is available at the same price as the normally bought product A and if.s'. and therefore exit.

u participate in actions designed to change ¿t p....4 as an important element in the decision t" voice.ractices.. 333. whlch appears ø exctuae a. It is useful to compare this formulation with the related one provided by Edward Banfield in his study of potitical influence: "The effort an interested party makes to put its case before the tlecisionmaker wili be in proportion to tlte odaøntn ge to be gøined from a futorable outcome m:u. Not nearly so high a cost is likely to be attached to the exercise of the exit option in the case of products Ì 10.t this influence. Edward C.... confid.o*l action or through that of others." and now against these chances.' about ¿ . p. This view of the matter shows the substitutability of B _ for."A ¡".r". in addition to this opportunity cost. voice will depend also on the willingness to take the chances of the voice option as against the certainty of the exit option and on the probabiìity with which a consumer expects improvements to occur as a result of actions to be taken by himself or by others with him or just by others.ithH.s . ¡ $ t. *'" ong!. though t"" i.rorr*¡rfitoìr9." tirt _""ï"'ì"ril""a. to be successful. is much widei than Banûeld. 1961).. but some may simply refuse tã u"liuirJ.ã ""Lj. and Loyalty Voice rifice of staying with .ä. yoice.s original _urein of superiority over B was wide enough øîri"-ìîi"iilr_ while for him to forego a B Lhatis supe"ior now.. bility." "irros.to .stomers (or members) who expect the com_ plaints and protests of others.ìn". a.rrr"îr¡" ¡.back on Ur" t lfr.r.*gf..*:1 O" c. Nevertheless.'loyallstsli wJl"tiu". i" silence. Itatics in thp original. In fact.influencã. ffi ß u p rl ß Þ $ å. ..ent that things will soon get bett"r. the deteriorating firm or organization ¿nd this aecision is in turn based on : (1) an evaluation of the chances of getting the flrm or organization producing . Nutu.do something. like most political scientists looking at the "articulation-of-interests" function.ïitf.ç é' field's formulation correcffi rrc' ti.l:: cost which so far has been identified as the foregoing of 1 the exit option. That will hardly ever be the .u but for our purposes there is need to i"tr"d. See ch.Lo Banfield derived this rule f¡om his study of public policy decisions in a large American city and of the participation of various groups and individuals in the decisionmaking process. iár'uìrri"tv of reasons. remaining a customer or member will he be. Ban. below."0 p. But given a minimum of ". combined . ."riã . ?.ion to 4i'i"L.b.. It should be noted that out concept of voici.ccount must be taken of the direct cost of voice I which is incurred as buyers of a product or members of an organization spend time and money in the attempt to achieve changes in the policies and practices of the firm from which they buy or of the organization to which they belong.àit that is not add¡essed directly to tûe ofrceholding decisionmaker.Iti. Othe¡s i""'"J^. li i þ i i L i faithfulness.rllv. The present model is more com ¿S¡ v g {gsult of the availability of a substitute product..^* \t' plied. as deûred at the beginning of this chapter."ì" "*" ø r*ii"l 1o B ¡phen they feet that they V¡outd switch back.. . (2) a judgment that it is worthwhile. option. iirì trr" vorce opuon rncludes vas y different degrees of activity and leadership in the attempt to achieve lAo* But it always yrthin. Banfield...4 . PoliticøI Influence (New york: _ Press Free of Glencoe.á* "i. lìor". was anaìyzing situations in lvhich indivicluals or groups had essentially the choice between passivity and involvement.-but as only one of severaì elements.urè if ¿ "ì*rrrî".e Many of these .Exit. He." .i-rrrr_ tional. fashion.ny expression of opinion ot ãi"". because of the costs ".""r"U close substitutes. the decision not to exit in the face of a clearly better buy (or organizatio"i . 11. tiru consumer will resort to voice i"l"åri if á. tl' e*".. Finally there are those who stay with ¿ oui that is. invotves the deci.r""ã.il" ¡. .4 because he feels that he r¡¡ants and is able. *ã". to trade the certainty of B which is u"uilr¡i" i". in a less rationat.iiJã.. bg the probøbilitg of influencíng tlt e d..ecision.

Exit. _..than the latter. voice is cos y and conditioned on the influence and bargaining power customers and members can bring to bear within the firm from which they buy or the organizations to v¡hich thev belong.ep¡e1 frq !g]Lþ_ìlygI" éòihbinê fõi ¿ólleCtivé aCilon ãnã simpiy Gcät3e -eæt-ôñè'i11ây hãvê much at stake and wiãá con-it -sillêaâbtsTñwei ávijn ìi-isolâtion. The Logia of Collecli.. namely. In addition. Yj{gllg ke.ue Aclion (Cam_ bridge.. nondurable good. horvever. Voice. These two characteristics point to roughly similar areas of economic and social life in which voice is likely to play an important role and to hoid exit at bay. But if he is stuck with an expensive durable good sueh as an automobile which disappoints him day-in and day-out. 1965) . A¡d his complaints vrill be of some concern to the firm or de¿ler whose product he has bought both because he remains a potential customer in one. The upshot of this discussion for the comparative roles of voice and exit at various stages of economic development is two-edged: the sheer number of available goods ¿nd varieties in an advanced economy favors exit over voice.es in crease=me co st even a modione of the h'-e. he . Obviously.tå i ì i in ¡rhich ì t I rs and mem- r conclusions r¡'ith respect to the Zocas of the voice option are reached rvhen one focuses on the other char¿c_ te¡istic which distinguishes voice from exit. however. 7. When the consumer has been dissatisfied with an inexpensive. of course. three. i11-12g. at leåst for a time. he is much less likely to remain siìent.vn: The Conceptif Cøuntòrtøiling Power (Boston: Eoughton Miflin Co. Arneri.ra Again.uc.12 Hence. this is not the case ín atomistic markets.r.se. and Loyalty Voice bought in the markeL-although some allowance should be made for the possible loss of loyalty discounts and for the cost of obtaining information about substitute products to 'rvhich one intends to switch.4¡_qqy:pwe. See. 40 or other mcmber-customers will be able to marshal some influence or bargaining power. iÁ morè cõminìõ¡rtuelrmtmteïjñfiuentiìtl äéthbers of an organization than buyers with a great deal of influence on the policies of firms from v¡hich they buy. 1956). Jr.. tlãiî fór manvtó 4l .: Harvard Unive¡sity press.Cdoúi ió. pp.ly'. blysj the former a¡e far less nume:ous. the proliferation of prod_ ucts tends to increase cross-elasticities of demand and to that extent it rvould increase the probability of exit for a given deterioration in quality of any one product picked plgq. As voice tends to be cos y in comparison to exit the cor volce of goods and services over l-purch. the point will be djscussed in ch. even though many buyers are ínvoived. ?¡ i*po"t"nt mecha4¡g¡-qq1¡9[¡. but the increasing importance in such an economy 13.lt is .!q_fu4ction ..both becåu. the cost of exit may be sub_ stantral. anl-ìõtr"i pìipor--/ -tidriõf 'tõtâl - -sales. ivhe¡ loyalry is present. the description of thé influential buyer in John Ken¡eth Galb¡aith. below. or five years'time and because adverse word-of-mouth propaganda is powerful in the c¿se of standardized goods. Certain types of purchases may nevertheless lend themselves particularly to the voice option. Mass.cøn Capitalì. See Mancur Olson.14. tions than among business firms. the requirement that a customer must expect that he himself fZ. ín comparison to the exit option.will most probably go over to a different variety without making a fuss.la and the voice option will therefore be observed more frequently ¿mong otganiza. -ói'ùhô¡èã fè\v EuteiÀ._?_.

while exit requires nothing but a clearcut either_ or decision. Voice.¡. Although the foregoing remarks restrict the domain in which the voice option is likely to be deployed. The b¡oail ¡ange of Nader's work. Moreover. Consumers have.. Voice K #l ffi official regulatory agencies.l ffi i i # & 1 ãs cañ communic¿te complaints cheaply and effectively. through revitalization of 15.: University of Michjean press1968). The V iet11 from llz. which have h¿d notorious difficulties in making their voice heard. it looks as though consume¡ voice will be institutionalized at three levels: through independent entrepreneurship à la Nader.g. is also the subject of t e¡ a¿ì"1" 'Reflectio-ns on Advocacy PIarLr¡Ì. ffil 42 This is ¿ central point of from a different angle in ! . anil Loyalty of standardized durable consumer goods requiring large outlays works in the opposite direction. Often it is possible to create entirely new channels of communication for groups.e Neu York Reoiew of Books. and through stepped_up pre_ ventive activities on the part of the more importanl füms selling to the puþtg. but to the more milit¿nt actions by or on behalf of consumers that have been taken recently.l? Thus.ro The creation of effective new channels through which consumers c¿n communicate their dissatisf¿ction holds one important lesson." Joùr. w. As ¿ result of these developments. such as consumers. the '. This situation makes for an impoúanl bias in favor of exit when both options are present: cus_ tomer-members will ordinarily base their decision on pøsú experience rvith the cost and effectiveness of voice even though the possible iliscoøerE of lower cost and greater effectiveness is of the very essence of voice. once voice is recognized as a mechanism with considerable usefulness for maintaining performance. i \ I i I I i i ! i i I c¿. made such progress in this regard that there is now talk of a "consumer revolution" as p¿rt of the general "participation explosion. 80-88.{ . ?.s r. in comparison to other interest groups. . institutions can be desigrred in such a v¡ay that the cost of individual and collective action would be decreased.nnet e (March 1968).ls The appointment since L964 of a eonsumer adviser to the President has been a response to this emergence of the consumer voice which was quite unexpected in an economy v¡here competition-exit is supposetl to solve most of the "sovereign" consumer's problems. 16. in fact.ithin the contêxt of cortrmuÌity act¡on in Venezuela. ffi argued. especiâlly as a substitute for exit. Or.-uen raises some doubts r¡¡hether the structural constr¿ints de_ serve to be c¿lled "basic" when they ean suddenly be over_ come by a single individual such as Ralph Nader. see List Redfield pezltie. in some situations.@-ms ffi ffi ffi i I #. is brought out in his article "The Great Äme¡ican GW. the rewar ds for successful action might be increased for those ¡rho had initiated it." Th.art" of eliciting voice. 4Z ffi i I i .A-nn Arbor." The former phrase does not refer to the long established and still quite useful consumet research organizations._voice is essentially an ¿rf cgnstanfly evolving in new directions. ¿l¡atton o.'Í :4 ifr JB . the next chapter. For another. nàóe"T e*perie"ce .* . Traditionally such fi¡ms have been engaged in considerable "auscultation" of voice through market survJysi 17. most vivid case in point.$ Exit.no. Þp. the most spectacular and resourceful being the campaigns of Ralph Nader.ø. November 21. who has established himself as a sort of seìf-appointed consumer ombudsman.e Borrio (.t of the ArrLer¿cdn Insli_ tute oÍ Plø. with respect to both products and action..! ¡èãdìn@ ant . tàiJ time in lãw_incomã neighborhoods of American cities. Mich. 1968. While structu¡al constr¡i¡ts lqwcilability of close substi i . ch. the territorlf left to it remains both considerable and somewhat ill-deflnecl.

Related Interests

entropy characteristic of human. Firms and other organizations are conceived to be permanently and randomly subject to decline and decay. and surplus-producing energ:f. times slack acts like a reserve that can be called upon: excess costs will be cut. no mâtter how well the institutional framework within which they function is tlesigned. while alw¿ys conspicuous in some are¿Ìs. is hardly in undisputed commanil everywhere and at ali times. frrms. imbalances. but that it is cor¿. surplus-producing societies. a blessing in disguise.Exit. it is impersonal face-to-f¿ce confrontation between customer and -any 15 . t4 See belov¡./ tíw. eficiency. who point out that it permits firms to ride out adverse market or other developments. This radical pessimism. Exit belongs to the former realm. categories of exit and voice would be suspiciously neat if it did not faithfully reflect a more funtlamental schism: that between economics and politics. shifts to that of another. our inquiry bifurcates.ouslg being genera. and Loyalty Quite a different reaction to the cliscovery of slack occurs when the discoverer asks himself." could be its motto. Introduction and Doctrinal Backgtound world ¿nd exists in given amounts. and he also sets in motion market forces whieh rnay induce recovery on the part of the firm that has declined in compar¿tive perfor"rnance. more radical step in recognizing the importance and pervasiveness of slack. The customer who. functions was put forward by Cyert and March.ls The immediate response to the discovery of slack has thus been either to assert the rationalíty of a certain level of slack or to look for ways of extirpating excessive levels by invoking exogenous forces such as adversity. It assumes not only that slack has somehow co¡¡ìe into the 18. to a gtadual loss of rationality. The ide¿ that slack fulfills some impoitan! if unintended or latent. as alreâdy explainerl lts breakup into the two contrasting. generates its own cure: for as long as decay. that is. dissatisted with the product of one frrm. 31-32. whether slack may not after all be a good thing. Both these approaches look at slack as a gap of a given magnitude between actual a¡rd potential performance of individuaÌs. Slack in the political system has been rationaiized in a very similar m¿nner. "There's ¿ slacker born every minute. and so on. Exit and Voice as Impersonations of Economics ancl Politics In examining the nature and strength of these endogenous forces of recovery. though not mutuaþ exelusive. innovations that were already within one's g:rasp wili at last be introduced. which views decay as an everpresent force conståntly on the attaek. This book takes a further. more aggressive sales behavior that had been shunned will nov¡ be engaged in. The discovery that citizens do not normally use more than ¿ fraction of their political resources came originally as a surprise and disappointment to political scientists who had been brought up to believe that democracy requires for its functionìng the futlest possible participation of all citizens. uses the market to defend his welfare or to improve his position . voice to the latter. During such bad. revolution. this is the sort of mechanísm economics thrives on. pp. and so on. ancl organizations. lt is neat-one either exits or one does not. after having got over his initi¿l shock. Voice. it is likely that the very process of decline activates certain counterforces.

Clearly. A particularly good illustration of this bias appears in a well-known essay by Milton Friedman which advocates the introduction of the ma¡ket mechanism into public erlucation. one major.:#l & .. if problem-plagued. 2:32-37 (June 1968). The economist tends naturally to think th¿t his mechanism is far more efficient and is in fact the only one to be taken seriously.The Failure ol the Public Schools and the Free Market Remedy. 91. Significantly. for it has been labeled desertion. and it is indirect recovery on the part of the declining firm comes by -åny courtesy of the Invisible Hand. Freedorn (Chicago: University of Chicago Press. however "cumbrous. Levin. In justifying this scheme he says: { t r \ å ä ø ã . The italics are mine. a "trained incapaeíty" (as Veblen called it) for perceiving the usefulness of one of our two mechanisms. In all these respects." is all their members normally have to work ¡vith. defection. "secret" vote in the anonymity of a supermârket.ticø) chan- *1 ï¡l nels. to a much greater extent than is now possible. 6 and the citeal Þassage appears unchanged on p.v * . The essence of the Friedman proposal is the distribution of special-purpose vouchers to parents of school-age chiidren..J. in the politicai realm exit has fared much worse than has voice in the realm of economics. it implies articutation of one's critical opinions rather than a private. Rather than as merely ineffective or "cumbrous.s bias in favor of exit and against voice. 129. 1955). it is direct and straightforward rather than roundabout. ¿.I:i. The Urbøn Eeaieu. Econonuics ønd the Public Intel'est (New Brunswick. In general they can now take this step only by changing their place of residence. by withdrawing their children from one school and sending them to another. thea can erpress tlteir aiews onlg througlt cumbrous poli. "The Role of Government in Education. Voice. and hopefully the slow improvement of these very channels ? In a whole gamut of human institutions. and indeed the democratic. In fact. N. and Loyalty firm rvith its imponderabìe and unpredictable elements is avoided and success and failure of the organization are communicated to it by a set of statisties . ed.irectla.É & å $ $ 'å' & Parents could express their views about sehools d.Ls 19. and finally.: Rutgers University Press." But what else is the political..'. â:.snr (rnÅ. voice is just the opposite of exit. å Introduction and Doctrinal Background I am not interestecl here in discussing the merits of the Friedman proposal. I am citing the above passage as a near perfect example of the economist. In the frrst place. But the economist is by no means alone in having a blindspot.4. 17 . For a good discussion see Ilenry M. For the rest. with these vouchers the parents couid buy educationai services that would be supplied in competition by private enterprise." in Robert . voice. A revised fordr of this essay was included in Friedmaî's Cøpite. as an unintended by-product of the customer's decision to shift. effort presently underway toward better public schools in the iarge cities is to make them more responsive to their members: decentralization has been advocated and unde¡taken as a meâns of making the channels of communication between members and management in the public school systems less "cumbrous" than heretofore. the use. process than the digging. Solo. It is ¿ far more "messy" concept because it can be graduated. all the way from faint grumbling to violent protest.2o Rather. from fhe state to the family. passions and preconceptions must be reduced 20." exit has often been brandecl as crimhnl. 1962) as ch. p. A person less well trained in economics might naiïely suggest that the direct way of expressing víews is to express them ! Secondly..t Exit. Friedman considers withdrawal or exit as the "direct" way of expressing one's unfavorable views of an organization.nd treason. t*. the decision to voice one's views ¿nd efforts to make them prevail are contemptuously referred to by Friedman as a resort to "cumbrous political channejs. 16 #. Voice is politicai action par excellence.

it being understood that the laissez-faire ådvocate's forces of goocl are the interventionist's forces of evil and vice versa. Voice. whereas both laissez-faire and interventionist doctrines have looked at market and nonmarket forces in a strictly Manichaean way.cal concepts. Perhaps it . that is. . this necessariiy conscious.22 process is not These views do not imply.e Strategg of Economic Deøelopment was based: Tradition seems to require that economists argue forever about the question whether.rket f orces are not necessar¿Iq less " wtomøtic" th. 53:947 (December 1963) .an tno. A close look at this interplay between market and nonmarket forces will reveal the usefulness of certain tools of economic analysis for the understanding of political phenomena.ceú. ¡vhen the market fails to achieve an optimal state. From this point of view. p.zirLly and the Econo¡nics of Medical Care. that is. . StralegA. and nonmarket social' institutions 21. possibly also in such a fashion that one gets into the other's way ând undercuts its effectiveness. This reciprocity has been lacking in recent interdisciplinary work as economists have claimed that concepts developed for the purpose of anâlyzing phenomena of scarcity and resource ailocation c¿n be successfully used for explaining politicat phenomena as diverse ås power.Exit. 63. in any disequilibrium situation. have been introduced as trtro principal actors of stricdy equal rank ancl importance. to econonzists the usefulness of politi. political mechanism work side by side. and Loyalty on both sides if advantage is to be taken of an exceptional oppodunity to obser-ve hotv a typical market mechanism and a typic¿I nonmarket. market and nonmarket forces. But they leave room for a conjunction-which could quite possibly be inadequate----of these tr. Now this is certainly an interesting question.vo forces. Ðven more important.Welfa¡e 22. ¿nd nationalism. as both Arrow and I immediat€ly hastened to add. In developing my play on that basis I hope to demonstrate to political scientists the usefulness of economic concepts anl. democracy. or by both acting jointly? It is ow contention that noru?Ll. "fJr.'. and. mnrket forces øcting olone are likely to restore equilibrium. 18 Introduction and Doctrinal Background will arise attempting to bridge it . recognize the gap. society will. Kenneth Arrow has argued along very similar lines for movements from less-than-optimal to optimal states: I propose here the view thåt. A final point. Itaiics in the originaì. that any disequilibrium or nonoptimal state whatever will be eliminated by some combination of market and nonmarket forces. They have thus succeeded in oecupying large portions of the neighboring discipline while politicai scientistswhose inferioriþ complex vis-à-vis the tool-rich economist is equalecl only by that of the economist vis-à-vis the physicist-have shown themselves quite eåger to be colonized ancl have often aetively joinecl the invaders.r ket f or c e s. economic and political mechanisms. Exit and voice. Amærican Econcrmic Review. possibly in harmony and mutual support. Hi¡schman. the analysis of this interplay will lead to a more complete understanding of social processes than ca¡r be afforded by economic or political analysis in isolation. by market or nonmarket forces. 19 . Nor do they exclude the possibility that the to sets of forces could work at cross-purposes. this book can be viewed as the application to â nerv freld of an argument on Ìrhich much of Th. to some extent at least. But as social scientists we surely must address ourselves also to the broader question: is the disequiiibrium situation likeìy to be corre¿ted at all. oice aersa.2t I was concerned here with disturbances of equilibrium ¿nd the return to it.

20 $.l Most authors ¿re content 'lvith general references to its "pressures" and "disciplines. in the iatter capaeity. Which $¡as carried out by David S' French' 2L . Voice. to judge from a determined though inevitably fragmentary search of the vast literature on competition. #. # * É * f & & ffi & ffi ffi jå ä: '. this neglect of what could be considered one of the principal virtues of the "free enterprise system" mây be particularly surprising. Nevertheless the precise modus operandi of the exit option has not reeeivecl much attention.f Exit. but rqtronnemer?¿ as well? I like to think that this could be a by-product of the present essay. the exit option is widely held to be uniquely powerful : by inflicting revenue losses on delinquent management. that firm must ipso facto be assumed to be mortally sick and to be ready to leave the stage while some vigorous newcomer is presumably tvaiiing in the wings to take its place' This "view of the American economy es a biological process in which the old and the senile are continu¿lly being replaced by the young and the vigorous.âli A The avaitability to consumers of the exit option. where the flrm has competitors but enjoys some latitude as both price-maker and qualitymaker-anal therefore. should such a failure nevertheless occur in the c¿se of some firrn. aìso as a qu¿lity-spoiler. As already mentioned." Insofar as the apologetic literature is concerned. exit is expected to induce that "¡ponderful concentration of the mind" akin to the one Samuel Johnson ¿ttributed to the prospect of being hanged. and Loyalty 2 Exit takes an economist to reawaken feelings of identity and pride among our oppressed colìeagues antl to give them a sense of confidence that their concepts too have not onìy grand.eur. but some of the reasons for it have already been suggested' Those who celebrate the invigorating qualities of competition are loath to concede that the system couÌd fail for even a single moment to make everybody perform at his peah form. ancl theit' frequent resort to it." as Galbraith puts it mock- iffil ffi. are characteristic of "norma1" (nonperfect) competition. &r 1.

tat:ísm : The Çoncept power (BoslorLi lloughton -K"11n*\Czlhraith Mifün Co.a Secondly. with the difference that quantity bought is made to depend on changes in quâlity rather than on price. the sentence cited j"_log4. the more massive the exit the greater the losses following upon any given quality drop.ã. '#.vounten)a¿txng . the effect of quality decline on revenue..ilä"råËi'ää" that "anotheï thíng deiired i" tr.normal" lead firms back to efrciency.oã.. In the former case.. in their eager_ ness to stake extravagant claims for their system. Perhaps the simplest way to visualize such a relationship is as a discontinuous threevalue function. p. aï-itr... performance.. p. anal Loyalty Exit ingly. if rather inconclusivelg scru_ tinized...cøn .possib. management undertakes to repair its failings. No reaction occurs for a small drop in revcosts 4. But.. two difierent scales-some measure of quality antl money-are divided into one another. .result in an efrcient allocation of resources within a static framework. has been very largely concerned with discussing the con_ ditio¡s under which competitive market struãtures re_ sult or faii to.unpteasa¡tselicesà"-. 22 # å ff $ W.. whereas in the case of price increases total revenue falls of course only if pzicø-elasticity of demand is gre¿ter than unitv. on the part of the firm. as far as I have been able to ascertain. there exists a management reaction function which relates quaiity improvement to the loss in salesupon finding out about customer desertion... & & * * å å * "&.. The technical economic literature. no study.":.. X.[ T *. total reYenue declines wheneve¡ lln'e quøLity-elasticity of demanil is greater than zero.. :.Joh¡-Mau¡ice Clark. in its lower portion. has been made of the related topic of competitionÈ abiiiiy to . which also shows. Brookinss Instilution. Just as quality is normally assumed to remain unchanged when the effect of price changes on demand are considered. ÈBangety.llimination of Inefrcieût Elements.î"-ätitiå". It would seem thai the apologists of competitive enterprise have missed.ri^'ão.d. theoretical or empirical.ü: ç Exit.le. does mention -ää. This is done irn Appendix A.. any numerical measure other than ze¡o and inûnity is the ¡esult of arbitrary scaling.1ùi. 81.ãt bá-Wi^'ñä"t uompetrhon to llo fo¡ Us?.petition øs a Dynøtnic p"""r"" iWå"ïiîJ"ì. and. Voice. Hence.# Cq¡ti. namely.'Cla¡k dealt at some lenEth with what he considered io be the ten principaL i"". ¿. Costs also remain constant. The response of demand and ¡evenue to quality changes can be graphically represented by mea¡s of a demand cu¡ve with the familiar dow¡ward slope if the ve¡tical axis of the traditional diagra:n is made to measure quality deterioration ¡athe¡ than pdce increase. 1961). One nonstatic aspect of com_ petition has also been amply.dom lapse in emciency rather than from a calculateal attempt..ã"" ¡n seerng'-to jt that faltering ûrms a¡e liquidated rathe¡ ihaa restored to health. systematic or casual. for by definition the quality decline results from a r¿m. This diagram makes clear that the effect on total tevenue of a decline of demand caused by quality decline is much simpler-and more damagingthar that caused by price rises.. øøE exit whatever of consumers in response to quality decline will result in revenue losses . to reduce by skimping on quality. which deals" p-rirnl-rlvwiththe. Whereas an increase in price can result in an increase in the fl¡m's total revenue in spite of some customer exit. onã of the more substanti¿i points to be m¿de in its favor. 4å tr & &" ffi familiar demand function. on the other hand. The first one is a variant of the ^"2. revenue can at best remain unehanged ¿nd will normally decline steadily as quality drops. IJnder these conditions. so it is now convenient to assume that price cloes not change when quality drops.-.ä.^{9-lI_ oI w . and gro'wth standards after they have lapsed from them.ä'"i secrron enu ed "¡.) 23 . the rescue of faltering ûrms is not among "? thãm."p"lìtïoî visiìant to eliminate inefÊciencies of p"". (Unit elasticiþ of demand has no precise rneaning in the case of qualityelasticity."f.. who had a most lively sense of the multi_ prlcrry o1 ïunctrons competition is expected to pedorm..2 does not leave room for sho\ying how competition helps to cure the temporary and remecliable lapses whose importance is stressed here. figure 2. almost as an afterttroughi.." Com. its aptitude to generate innovation and growth. 1956). in ch.l. When the concept of "quality-elasticitv of demand" is put together in a¡alogy to p¡ice-elasticity. ff # ff s .3.. s: È q R & di.iiã"".ã i"ås"" have so depleted their Ìesoùrces as to make rõfrr¡ilitäiio"-ãijfr""rt or im.s IIow the Exit Option Works The conceptual elements needed for such an exploration are straightforwarcl. Amet ì. of course.

According to traditional notions.'For the recuperation potential of the firm to come into play. which is intuitively evident can also be phrased as follows: r'or competitior. in perfect competition (which includes perfect consumer knorvledge as one of its many exacting assumptions) the firm is not deprived of an effective correction mechanism bec¿use performance deterioration.s $ * f #. the world of quasi-perfect competition is not. it is therefore desirable that quality elasticity of demand be neither very large nor very smalì. then again. but one râther far removed from it.¿¿¿¿-cusmìnef *Th-eãIe¡trusiõners provide the frrm with a feedback mechanism v¡hieh starts the effort at recuperation while the inert customers provide it with the time and dollar cushion needed for this effort to come to fruition. But if demand is very elastic. is reflected direetly in a decline in revenue (due to increasing costs). no recuperation ensues-beyond a certain poínt. In other words. It'would be easy to think instead of a continuous ¡eaction cu¡ve. this time because the frrm will be wiped out before it will have had time to find out ¡¡¡hat hit it. while the perfectly competitive world is a feasible one from the point of view of an effective recuperation mechanism. Consideration of competition as a recuperation mechanism reveals that. the more ¿lert the customers the better for the functioning of competitive markets.Exit. o. ¡vhich cannot possibly affect either quality or price. If there is to be a drop in quality it is desirable that it be of the size which leads to recuperation. and Loyalty å enue. and. the concept of a firm with no latitude as to quality whatever. the ¡eaction rtrould turn into ¡einforcement as demo¡alization and other results of ûnancial stringency would compound quality deterioration and thus hasten the fi¡m's dow¡fall. Such a shape of the reaction function vr'ould not change malerially the points that will be made in the lext. the flrm rvould come to produce at qualities superior to the ones at which it started out-to that extent one might speak of a point of . then performance deterioration can (and is perhaps likely to) t¿ke the form of quality decline ancl if the ma¡ket in which the firrn sells is highly competitive. 5. then the optimal årrangement is not one as close ¿s possible to that of perfect competition. as a result of the teaction. and incremental moves in the direction of perfect competition are not neeessarily improvements-the argument of the second best applies here in full force. the recuperation process will not take place either. At a Iater point. full recovery folÌows upon a drop of intermediate size. # & 25 . Evidently if demancl is highly inelastic rvith respect to quality change.1 . revenue losses will be quite small and the firm will not get the message that something is arniss. If one gives up. a r @e-orø¿çz¿-¿n¿. much less to do something about it. But assume now a small departure from the perfecUy competitive model so that the firm has some latitude in varying quålity.& Exit of course.fl ä å T * . disastrous instability might result and firms would miss out on chances to recover from their occasional lapses. Voice.. that is. *: '& . a1though exit of some customers is essential for bringing the mechanism into play. losses will weaken the firm so badly that bankruptcy will occur before any remedial measures can take effect.. quality decline : if all were assiduous re¿ders of Cor¿su. in quality.mer Reports. or deter"rnined comparison shoppers. Remedial action would be small with small sales losses a¡d would the¡ increase and l¿ter decline. This proposition. too soon. beyond a ce¡t¿in loss in sales. Thjs is a câse of "too much.'r*t .. or unperturbed by. fulì of highly knowledgeable buyers. it is senerally best for a firrnJõTave formance lapses..$'l & w w: #.{*i . if the revenue decline exceecls a cer_ tain large percentage of normal sales volume. å *l å gj . It is even conceivable that.g w .optimal deterioration. the firm ¡rill be competed out of existence in very short order. it is important that other customers remain una\ryare of.l ("¡t) to *ork a -" cuperation from per". As has already been noted. as he must in most real cases.ã The interaction between the exit function ancl the reac_ tion function can now be described.

. This argument is explaiaed more fully below. Needless to say my Falcon is the last of any Ford p¡oduct f would conside¡ to purchase. . A competitively produced new product might reveai only through use some of its faults and noxious side-effects. To help him judge I should like to provide some sample passages from letters recently fired off. and (ö) to the General Moto¡s Corporätion: . This is even more the case if the most determined comparisoa shoppers are those who would make most t¡ouble fo¡ the manufactu¡e¡s if there we¡e ao possibility of exit. . 7. The reader c¿n judge whether elements of the foregoing situations can be detected in the economic and commercial life around us. ancl a merger of all firms would appeâr to be socially desirable is. At home we have a Chev¡olet bus and a Chev¡olet van. however. and Loyalty Exit å Competition as Collusive Behavior r $ No matter what the quality elasticity of demand. But why would a firm whose output deteriorates in quality alLraet any new customers at all ? One can actually think of a situation in which this seemingly quite unlikely event would come to pass : when a uniform quality decline hits simultaneously all firms of an industry..'.. when there are other tJrings in this q¡o¡1d where the money could be put to much bette¡ use . the manufacturers have â. . . a slight modification of the previous situation serves to endow it with greater realism and relevance. exit could fail to cause ¿ny revenue loss to the individual firms if tlte fi. Competition in this situation is a considerable convenience to the manufactu¡ers 26 T å i å * å À ð * --. You mav be absolutely ffi * # & o4 atl . all equaily faulty.ç''r Exit.. The competitive mechanism then ¡ids manageûrent of its potentially most troublesome custome¡s. eâch firm would garner in some of the disgruntled customers of the other firms while losing some of its previous customers to its competitors. But even if this premise is droppetl." that is.it loses tl¿e old. who has depleted her bank account buying Falcon transmissions. and hence for delay in bringing pressure on manufacturers for effective improvements in the product. for customer dissatisfaction would then be vented directly and perhaps to some effect in attempts at improving the monopoly's management whereas under competition dissatisfaction takes the form of ineffective flitting back and forth of groups of consumers from one deteriorating firm to another without any firm getting a signal that something has gone awry.. . reasonably attractive. it diverts their energlr to the hunting for the inexistent improved producls that might possibly have been turned out by the because competition. 6.lemons.6 The argument presented so far maintained the premise that the unsatisfactory features of the product turned out by the various competing firms could be eliminated as a result of pressures and a resultant search for solutions. neu customers os. consumers rvould learn to live with inevitable imperfection and would seek happiness elsewhere than in the frantic search for the inexistent "improved" product. You can be assu¡ed that I will aot purchase anothe¡ Ford of any kind no matter what you¡ usual fo¡m letter to me will say .? A few comments may be in order. For the presence of a number of competing firms fosters in this case the perpetual illusion that "the grass is always greener on the other síde of the fence. Voice. it keeps consumers from complaining. (ø) to the Fo¡d Motor Company: '¡. Under these circumstances. .rm acquired. .s # .. In these circumstances the exit option is ineffective in alerting manâgement to its failings. I am a youag girl of 25.èl'. While a simultaneous and uniform deterioration of all frrms in a certåin type of business is of course highly unlikely.ffit å. .. Under monopoly. In this case the claims of the various competing producers are likeiy to make for prolonged experimenting of consumers with alternate brands..". monopoly would replace competition to advan-th¿t tage. that an escape from defectiveness is possible through purchase of the competitor's product. common interest ín the m¿intenance rather than in the abridgement of competition-and may conceivably resort to collusive behavior to that end. . . the competitive solution may again be inferior to one in which a single flrm is the sole producer. ones. by i¡ate owrte¡s of .

Radical critics of societies with stable party systems have often denounced the competition of the dominant parties as offering "no real choice. w & $ $ & 28 #i 29 . one can sureìy conceive of circumstances under which it would turn into a liability. product of any kind on my d¡iveway . American Federation of Labor and Congress of Industriai Orga¡izations.ations other than business ûrms. and that to this extent competition and prod-ûõrdìiêismc¿Eoä is-@ily when. Nevertheless the radical critique is correct in pointing out that competi- K 'w divert what might otherwise be a revolutionary ground swell into tame discontent with the governing party. Conslitution of the AFL-CIO (Washington. #.&i g w AFL merger of 1955 was the No-Raiding Agreement which was concluded between the two organizations trvo years earlier. January 1956). on the relevance of the preceding notions for orgar. . auto and wagon for many years nolv but maybe FORD has a better idea. AFL-CIO Publication no. It was found that most petitions were unsuccessful and that those which were granted were about equally divided between CIO petitions to displace an AFL union and AFL petitions to displace a CIO union. that such changes are desirable) . '. 36. t that the dis'advantages of exit-com s case its per g advantages the assumption @ 8. con"sumers would either bê abie to biînE nioiã-êlÏãcïìîe nre¡surel upon manaseññt toward eneror would sto will that competitive political å iå * & ." It is of course ¿ very open qìtestion whether." Copies of the lettêrs from which these excerpts a¡e taken were mailed by their authors to Ralph Nader who has kindly màde them available to me. .i?. "compel the conclusion that raids between AFL and CIO unions are destructive of the best interests of the unions immediateiy involveil and also of the entire trade union movement. so the report says. Voice.C. and the desirability of devoting the energies of the trade union movement to the organization of unaffiliated workers rather than to raiding. for the sake of the argument. I g # *' æ & & 'w.M. p. addressed by CIO-AFL unions to the National Labor Relations Board for certification as the ofrcial bargaining agents in industri¿l plants. '&. successful or not.a be å systems s' w have frequently been portrayed in just these terms.. The text of this agreement referred to a statistical study of all petitions over a two-year period. in-lts ãbsence. I'I1 try to put up with this LEMON tiu the '?0 models come ouq but you can be sure the¡e will be no G. in the absence of the competitive party system. Exit. the document cites unrest and disunity createcl among the workers as a result of the raids. and Loyalty #. #' . . I am indebted to John Dunlop for the reference and fo¡ discussing this point with me. D. G. A preliminary step to the CIO- . The basie point is that rå.ä '#) Exit .M. A less speculative illustration of the issue under discussion can be drawn from the history of the trade union movement in this country.' tive political systems have a considerable capacity to sure that after all of this trouble and inconvenience and r¡¡asted time shall never own a General Motors product again . Although this capacity may normally be an asset. 2." 8 As reasons for this conclusion. citizens woulcl be better able to achieve fundamental social and political changes (assuming. I have had a.. 'Ihese results." '. ü gg-p:titign@gover of each othets' customers on the part of a group of comng firms .

policies. either as a. The very idea that this is another . As before. But voice is like exit in that it can be overdone : the cliscontented customers or members could become so harassing that their protests would at some point hinder rather than help whatever efforts at recovery are unclertaken.. Powell. Just as in economics it had long been thought that the more elastic demand is (that is. It is the¡efore both legitimate and timely to examine the conditions under which the voice option is likely to make an effective âppearånce... "U state "h"on". Voice is here d"finud r.3 Voice Voice have long dealt systematically with this function and its various manifest¿tions. on the one hand. rather than just go over to the competition. an objectionable of affairs. Nothing remotely similar can be said about the voice option. B. Brown and Co. For reasons that rvill become clear this is most unlikely to happen in relations between customers and. which affirms that the choice is tw neutral terminologlr. and outputs of the firm from which one buys or of the organization to which one belongs.y rff"-pt . complement to exÍt or as a substitute for it. -TirgtG as compared to that of exit. while economists have refused to consider that the discontentecl consumer might be anything but either dumbly faithful or outright traitorous (to the flrrn he used to do business with) . up to a certain point. so it has long been an article of faith of political theory that the proper funcion31 . 30 zation which is remediable provided the attention of management is sufffrciently focused on the task. whether lescape I through-TrìdivÍdÌãf-o'r co1'lèltive-T-e-fitÍõñ-to-the manI agement directly in charge." t Political scientists ].recuperation mechanism" which can come into pìay alongside. Fot a ¡ecent treatment in a comparative perspective see G. that voice is nothing but a basic portion and function of any political system. Co1tupø. ch. then the effeetiveness of voice will increase.t to . through appeal to a higher iauthority with the intention of forcing a change in manj agement. the more rapidly exit ensues whenever deterioration occurs) the better for the functioning of the economic system. Yet.th)e Politícs: A Deøeteym. business firms. is for the customer or member to make an attempt at changing the practices. ' including those that are meant to mobilize pubiic opinion. the exit option is iikely to be met with a mixture of incredulity and raised eyebrows. It is becoming clear. To ¡esort to voice. known sometimes also as "interest articulation. can . If conditions are such that the decline leads to voice rather than to exit on the part of the discontented member-customers. 4. the initial assumption is a decline in the performance of a firm or organi- If the exit option has not been investigated in detail by economists.ro.kick up a fuss'. consumers (or members of an organization) . but in the realm of politics-the more characteristic province of voice-the possibility of negative returns to voice making their appearance at some point is by no meâns to be excluded. Almond and._ G. from.entøl Approøch (Boston: Little. it has become quite apparent that dissatisfied. its existence and effect on performance-generally presumed to be wholesome-nevertheless underlies many judgments and attitudes toward economic institutions. as was already pointed out in the introductory chapter.. rather than exit. on the other. and thereby force improved quality or service upon delinquent mânâgement. r. or through various types of actions and protests.u {M . A niche thus exists for this book. An interesting parallel appears here betrveen economics and exit. A. 1966). with its volume. remarks on the wo¡king of voice in isolation. or in lieu of. in this age of protest. Jr. and politics and voice. But in doing so they have ordinarily confined their attention to situations in which the only alternative to articulation is aquiescence or indifference (rather than exit).

the citizen must express his point of view so that the political elites know and can be responsive to what he wants. for long periorls of time.J.ern Potiti. 1959). Who Goaerns? (New Haven: yale University Press. permanent activism or total apathy. The essential reãsoning behind this thesis is quite simiìar to the argument made earlier on the need for exit to stay within certain bounds. 6 for dáta and principal ff. is that the ordinary faiiure. but the mixture of monopolistic and competitive elements characteristic of most real market situations should make it possible to observe the voice option in its interaction rvith the exit ontion.organizalional :l?"k"_! the economic system.B According to another line of reasoning. either exit or voice wiìl ordin¿rily have the role of the d. Tie Ci. on the part of most citizens. si *. this belief was shahen by empirical studies of voting and political behavior which demonstrated the existence of considerable political apathy on the part of large sections of the public.nant teaeLion mode." Pol'itinøl Life (New York: Free Press of Glencoe. Gab¡iel A. but.2 Since the <iemocratic system appeared to survive this apathy rather weil. the democr¿tic political system requires "blending of apparent contradictions" : on the one hand. Dahl. ancl vocal public.. #) rs: $ # & ffi &. the state. tr ñ s. aA_SA. . p. that exit and voice will always both have positive effects at first and destructive ones at a later stage. As in the case of exit. it is difficult to conceive of a situation in which there woukl be too much of it. and Loyalty ä Voice '&. The citizen must thus be in turn influential and deferential. * 3. some time to respond to the pressures that have been brought to bear on it. these elites must be alloivecl to make decisions. Inc. This does not mean. in certain respects. This pcint is remarkably similar to the o_ne -ma{e by March and Cyert about the virtues of '. See ?he Behøøiorøl Theorg of the Fìmø^(Englewood Ctifs. 1966). Robe¡t A. The subsidiary mode is then likely to show up in such limited volume that it will never become clestructive for the simple reason that. Inc. the job of destruction is accomplished single-handedly by the dominant mode. In the case of normally competitive business firms.aic. One reason. |ü sources. pp. for example. DahI. Almond and Sidney lerba.: Prentice-Hall. to use their potential political resources to the full makes it possible for them to react with unexpected vigor-by using normally unused. on the other. 1965).. Finally. pp. if deterioration proceeds. ing of democracy requires a maximally alert. w.1$ :si . may actually serve democracy better than either total. stressed by Robert Dahl. a mixture of alert ancl inert citizens. ä ffi. Voice has the function of alerting a firm or organization to its failings. ic & & # #. old or new.g Exit. A simila¡ thousht iÀ expressed bv_Robert ljne who-shows that.å Ë ff . then. 1968).-.:åli #r Voice as a Residual of Exit The voice option is the only way in which dissatisfied customers or members can teàct whenever the exit option is unavailable.mocrøcy in îù. or even ¿n alternation of involvement and withdrawal. prorqr an{ Co. . In the United States. pp. it became clear that the relations between political activism of the citizens ¿nd stable democTacy àye considerably more complex than had once been thought. 338*844.orwi. C1ifs. active. ch. 309-310.cøI AnøIytis (Engìewood k v w ç . exit is clearly the dominant reaction to deterioration and voice is a badly underdeveloped mechanism. &r.a __?a See Robert A. however. Mod.bne can assign diíf€rent political ¡oles to t}re political activists and the indiferents and that a balance between the two can achieve beneficient ¡esults. give management. 845. but it must then s.e Nøtions (Boston: Litde. 4. i*-: #. the theoretical construct of pure monopoly would spell a no-exit situation. In the economic sphere. the relation between voice and improvement in an organization's efficiency has considerable similarity with the modus operandi of exit.. In the case of any one particular firm or organization and its deterioration.ti. This is very nearly the situation in such basic social organizations as the family.-Culture: Po¿i.: Prentice-Ilal1. Voice. De. N.cùl Athitudes ønd.J. Inc.. N. or the church. 1961). reserves of political power and influence-whenever their vital interests are directiy threatened.

the voice of the nonconsumer on whom "off"rîrorrih"*. the atmosphere in the for_ mer countries is more suffused with loud.mer too has a ¡ole-to pfäv i"-ão -p-fãÁã"ting the mecharrimr. Voice w # #i . and so forth). up to the point where.. Similarly. ive shall assume that exit is the dominant re¿ction mode. the possibility of voice having a destructive rather than constructive effect may therefore be excluded. on the quality eiasticity of demancl.rnmt to exit. &' # # & å # . the role of voice wouÌd increase as the opportunities for exit decline. as. to derive an aggregate recuperative effect. Voice may cause direct monetary losses to the firm. The other determinant of voice is of course the degree of discontent of the nonexiting customer which depends roughly on the degree of deteriora- tion..¿s ¿ìubrtit. voice can be viewed as a residual. tf. -ã#". or on the lack of opportunity for exit. the disecon_ omies are inflicted could become a valuabìe adjunct ø tfr" tjve mechanism.o""i ia"Jifrrt the most serious impediment to the hòpe. for example.s iã. & w advanced economy."ä"ì tu trrài" is a net gain from the point of view of the recuperation "*ãiu.fff* Ërmn-âtæaÍóiæ f*rh-"il. noi ."jji!"-"} l¡tterrng ot beaches with beer cans.here dissatisfaction is more likely to take the form of silent exit. mechanism. The relationship between the volumes of exit and voice that is indicated here is spelled out in more formal terms in Appendix Ä. it was fountl necessary to give voice a more prominent role. often politically colored protests against poor quality of goods or services than it is in the advanced countries v.#r * K å ffi. ff ffi' $ # # w & clandise. then its likely efectiveness in making u" i^pr"""ià" ã". like exit. But the direction of the relationship is turned around: with a given potenti¿l for articulation. Therefore. these diseconomies could be contai¡ed o.. -If -voice appears exclusively in this particular i""rÀrii"". the actual level of voice feeds on i. Turning now to the reaction function. these nonexiting customers are therefore the source of the voice option. fn a preliminary appraisal of the eombined effect of exit and voice.. p""rruntuJ' tfrro"ãf.. they ¿re likely to experience different degrees of unhappiness about the quality decline' Being presumably endowed with some capacity to articulate this discontent.--Voice could usefully complement competition also in a rno¡e lamrl¡ar context.u ã"i"turr"" diseconomies in production and consumption tpolliUon. Voice.ê. .ã.. to the effect of voice on recuperation of efficiency on the part of voice-exposed management. Economists who have hopefully eyed competition. Obviouily. Whoever does not exit is a candidate for voice ancl voice depends.nelastic demantl.. nor between as many varieties of the same good." -"rrp.äl f # .ü"" añiculation of protests on the paït of ìhose who ln other $/ords.""scious managers can be precisely meaiured ajainst th.s aùility to allocate ¡esou¡ces efrciently have g"""iufiv .w $ Exit.s fuìfiiheni i.€ Both the propensity to protest and the effectiveness of complaints vary widely from one firm-customer complex to another.i oi s"" Àppendi'< A. Whiie they are not yet reâdy to desert the firm. voice function-i asã co¡npl-e. Once this is ¡ealized it is pe. but look now at those who continue âs customers.ha. . first approximation. ""ii.6 In this view. voice must carry the entire burden of alerting management to its failings' That such a see-saw relationship between exit and voice exists in fact In a to some extent is illustratecl by the many complaints about quality and service that h¿ve been prominently published for years in the Soviet press. nor between as many ways of traveling from one point of the country to another. But three gene¡al statements can be made: ( 1) In the simple model presented up to now. as in an 5. that is. when dissatisfied co¡sume¡s are able to turn in aeiecüve ¡ler_ ffi #. With exit-competition playing a much smaller role in the Soviet economy than in the market economies of the West. voice is in a much more commanding position in less developed countries where one simpiy cannot choose between as many commodities. Obviously sales losses and com_ plaints or protests of those who remain members are not easily added. and Loyalty We return to the simple relationship between deterioration of a product and tleelining sales.e consu. with exit wholly unavailable.ilirg "ãÃpìti_ that the voice oi t}. _ ?.? 6. then..

because of the budget constraint. be more appropriate to put matters in this way. Eventually. the decision whether to exit will often be taken in the lisht pf_the g!o. quâliff-elasticity of demand. the voice option is more likely to be taken at an early stage. of t . Hence. The reason for rvhich even such a pattern may be too much weighted by exit will be commentetl on at some length in Chapter 4.K Exit.. an important component of the voice option consists in this decision to continue as a customer of the deteriorating and now inferior product (or as a member of the deteriorating organization). as quality becomes abominable. does it possibly occur to them to make a fuss. however. Voice. but there may well be a number of goods and services whose demand will move from qualityelastic to quality-inelastic for a wide range of quality declines. being impaired. then. the optimal pa!tern from the nojnt of vieiv of maximizing_lhe combined effectiveness of exit and voice over the whole orocess of '{éteriõiãflon mayTe an elastic response of demand to the anããlinelasuõ onãJor ttre @ consumer responses to price incre¿ses for certain commodities which are vitally needed in limited quantities even at high prices. but not vice versa. then they may well postpone exit. for if deterioration is a process unfolding in stages over a period of time. (3) Considering that beyonal a certain point. a decline in quality ffi & tr & & # ffi ffi ffi ffi w & & ffi ffi ffi ffi & first decide rvhether to shift to another firm or producf regardless of their ability to influence the behavior of the firm from which they usually buy.f or tlæ eff ectiae use of a oi. especially if the only aiternative available for a deteriorating product is a higher-priced substitute. under what conditions will a customer of A fai. because of the deterioration of . that voice can be a substitute for exit. exit will therefore be a reaction of lost resort after voice has faiied. in some situâtions. What are the conditions.I to go over to B? Once voice is viewed as a substitute for exit. It appears. you have lost the opportunity to use voice.ce. and Lo¡'¿]fy Voicc (2) The more effective voice is (the effectiveness of exit being given). only if they do not shift.s2_9-ql. therefore. for it will presumably be taken only by those who wish for and expect. B is now clearly superior fro¡n the point of view of A's customers.4 to recover its original superiority over -ts. Once you have exited. exit has a destructive rather than salutary effect. can also be viewed as depending on the ability and willingness of the customers to take up the voice option. It may. when price increases indefinitely). Ordinarily. If the matter is put in this way it is immediately ev! dent. the treatment of voice has suffered from a certain timidity: the new concept has been viewed as wholly subordinated to eút. See Appendix B for a mo¡e technieal discussion of the topics treated in this section. In judging the volume of voice to be determined by the quality elasticity of demand. as well as a complement to it.4. in fact. Voice as an Alternative to Exit 8 Up to now. but whose consumption rvill easily expand beyond this point if prices drop. the more quality-inelastic can demand be without the chances for recuperation stemming from exit and voice combined. demand will vanish (just as it does. one implicitly assumes that customers who are faced by 8. If customers are sufr ciently con-vincèdTñãtïoice ìil-l be effective. a customer or member will undergo the sac- . It may similar1y apply to quality eìasticity of demand. and not necessarily by all of them. of course. under which voice will be preferred to exit? The question can be formulated more preeisely as follows : If a competing or substitute product B is available at the same price as the normally bought product A and if.s'. and therefore exit.

u participate in actions designed to change ¿t p....4 as an important element in the decision t" voice.ractices.. 333. whlch appears ø exctuae a. It is useful to compare this formulation with the related one provided by Edward Banfield in his study of potitical influence: "The effort an interested party makes to put its case before the tlecisionmaker wili be in proportion to tlte odaøntn ge to be gøined from a futorable outcome m:u. Not nearly so high a cost is likely to be attached to the exercise of the exit option in the case of products Ì 10.t this influence. Edward C.... confid.o*l action or through that of others." and now against these chances.' about ¿ . p. This view of the matter shows the substitutability of B _ for."A ¡".r". in addition to this opportunity cost. voice will depend also on the willingness to take the chances of the voice option as against the certainty of the exit option and on the probabiìity with which a consumer expects improvements to occur as a result of actions to be taken by himself or by others with him or just by others.ithH.s . ¡ $ t. *'" ong!. though t"" i.rorr*¡rfitoìr9." tirt _""ï"'ì"ril""a. to be successful. is much widei than Banûeld. 1961).. but some may simply refuse tã u"liuirJ.ã ""Lj. and Loyalty Voice rifice of staying with .ä. yoice.s original _urein of superiority over B was wide enough øîri"-ìîi"iilr_ while for him to forego a B Lhatis supe"ior now.. bility." "irros.to .stomers (or members) who expect the com_ plaints and protests of others.ìn". a.rrr"îr¡" ¡.back on Ur" t lfr.r.*gf..*:1 O" c. Nevertheless.'loyallstsli wJl"tiu". i" silence. Itatics in thp original. In fact.influencã. ffi ß u p rl ß Þ $ å. ..ent that things will soon get bett"r. the deteriorating firm or organization ¿nd this aecision is in turn based on : (1) an evaluation of the chances of getting the flrm or organization producing . Nutu.do something. like most political scientists looking at the "articulation-of-interests" function.ïitf.ç é' field's formulation correcffi rrc' ti.l:: cost which so far has been identified as the foregoing of 1 the exit option. That will hardly ever be the .u but for our purposes there is need to i"tr"d. See ch.Lo Banfield derived this rule f¡om his study of public policy decisions in a large American city and of the participation of various groups and individuals in the decisionmaking process. iár'uìrri"tv of reasons. remaining a customer or member will he be. Ban. below."0 p. But given a minimum of ". combined . ."riã . ?.ion to 4i'i"L.b.. It should be noted that out concept of voici.ccount must be taken of the direct cost of voice I which is incurred as buyers of a product or members of an organization spend time and money in the attempt to achieve changes in the policies and practices of the firm from which they buy or of the organization to which they belong.àit that is not add¡essed directly to tûe ofrceholding decisionmaker.Iti. Othe¡s i""'"J^. li i þ i i L i faithfulness.rllv. The present model is more com ¿S¡ v g {gsult of the availability of a substitute product..^* \t' plied. as deûred at the beginning of this chapter."ì" "*" ø r*ii"l 1o B ¡phen they feet that they V¡outd switch back.. . (2) a judgment that it is worthwhile. option. iirì trr" vorce opuon rncludes vas y different degrees of activity and leadership in the attempt to achieve lAo* But it always yrthin. Banfield...4 . PoliticøI Influence (New york: _ Press Free of Glencoe.á* "i. lìor". was anaìyzing situations in lvhich indivicluals or groups had essentially the choice between passivity and involvement.-but as only one of severaì elements.urè if ¿ "ì*rrrî".e Many of these .Exit. He." .i-rrrr_ tional. fashion.ny expression of opinion ot ãi"". because of the costs ".""r"U close substitutes. the decision not to exit in the face of a clearly better buy (or organizatio"i . 11. tiru consumer will resort to voice i"l"åri if á. tl' e*".. Finally there are those who stay with ¿ oui that is. invotves the deci.r""ã.il" ¡. .4 because he feels that he r¡¡ants and is able. *ã". to trade the certainty of B which is u"uilr¡i" i". in a less rationat.iiJã.. bg the probøbilitg of influencíng tlt e d..ecision.

Exit. _..than the latter. voice is cos y and conditioned on the influence and bargaining power customers and members can bring to bear within the firm from which they buy or the organizations to v¡hich thev belong.ep¡e1 frq !g]Lþ_ìlygI" éòihbinê fõi ¿ólleCtivé aCilon ãnã simpiy Gcät3e -eæt-ôñè'i11ây hãvê much at stake and wiãá con-it -sillêaâbtsTñwei ávijn ìi-isolâtion. The Logia of Collecli.. namely. In addition. Yj{gllg ke.ue Aclion (Cam_ bridge.. nondurable good. horvever. Voice. These two characteristics point to roughly similar areas of economic and social life in which voice is likely to play an important role and to hoid exit at bay. But if he is stuck with an expensive durable good sueh as an automobile which disappoints him day-in and day-out. 1965) . A¡d his complaints vrill be of some concern to the firm or de¿ler whose product he has bought both because he remains a potential customer in one. The upshot of this discussion for the comparative roles of voice and exit at various stages of economic development is two-edged: the sheer number of available goods ¿nd varieties in an advanced economy favors exit over voice.es in crease=me co st even a modione of the h'-e. he . Obviously.tå i ì i in ¡rhich ì t I rs and mem- r conclusions r¡'ith respect to the Zocas of the voice option are reached rvhen one focuses on the other char¿c_ te¡istic which distinguishes voice from exit. however. 7. When the consumer has been dissatisfied with an inexpensive. of course. three. i11-12g. at leåst for a time. he is much less likely to remain siìent.vn: The Conceptif Cøuntòrtøiling Power (Boston: Eoughton Miflin Co. Arneri.ra Again.uc.12 Hence. this is not the case ín atomistic markets.r.se. and Loyalty Voice bought in the markeL-although some allowance should be made for the possible loss of loyalty discounts and for the cost of obtaining information about substitute products to 'rvhich one intends to switch.4¡_qqy:pwe. See. 40 or other mcmber-customers will be able to marshal some influence or bargaining power. iÁ morè cõminìõ¡rtuelrmtmteïjñfiuentiìtl äéthbers of an organization than buyers with a great deal of influence on the policies of firms from v¡hich they buy. 1956). Jr.. tlãiî fór manvtó 4l .: Harvard Unive¡sity press.Cdoúi ió. pp.ly'. blysj the former a¡e far less nume:ous. the proliferation of prod_ ucts tends to increase cross-elasticities of demand and to that extent it rvould increase the probability of exit for a given deterioration in quality of any one product picked plgq. As voice tends to be cos y in comparison to exit the cor volce of goods and services over l-purch. the point will be djscussed in ch. even though many buyers are ínvoived. ?¡ i*po"t"nt mecha4¡g¡-qq1¡9[¡. but the increasing importance in such an economy 13.lt is .!q_fu4ction ..both becåu. the cost of exit may be sub_ stantral. anl-ìõtr"i pìipor--/ -tidriõf 'tõtâl - -sales. ivhe¡ loyalry is present. the description of thé influential buyer in John Ken¡eth Galb¡aith. below. or five years'time and because adverse word-of-mouth propaganda is powerful in the c¿se of standardized goods. Certain types of purchases may nevertheless lend themselves particularly to the voice option. Mass.cøn Capitalì. See Mancur Olson.14. tions than among business firms. the requirement that a customer must expect that he himself fZ. ín comparison to the exit option.will most probably go over to a different variety without making a fuss.la and the voice option will therefore be observed more frequently ¿mong otganiza. -ói'ùhô¡èã fè\v EuteiÀ._?_.

while exit requires nothing but a clearcut either_ or decision. Voice.¡. Although the foregoing remarks restrict the domain in which the voice option is likely to be deployed. The b¡oail ¡ange of Nader's work. Moreover. Consumers have.. Voice K #l ffi official regulatory agencies.l ffi i i # & 1 ãs cañ communic¿te complaints cheaply and effectively. through revitalization of 15.: University of Michjean press1968). The V iet11 from llz. which have h¿d notorious difficulties in making their voice heard. it looks as though consume¡ voice will be institutionalized at three levels: through independent entrepreneurship à la Nader.g. is also the subject of t e¡ a¿ì"1" 'Reflectio-ns on Advocacy PIarLr¡Ì. ffil 42 This is ¿ central point of from a different angle in ! . anil Loyalty of standardized durable consumer goods requiring large outlays works in the opposite direction. Often it is possible to create entirely new channels of communication for groups.e Neu York Reoiew of Books. and through stepped_up pre_ ventive activities on the part of the more importanl füms selling to the puþtg. but to the more milit¿nt actions by or on behalf of consumers that have been taken recently.l? Thus.ro The creation of effective new channels through which consumers c¿n communicate their dissatisf¿ction holds one important lesson." Joùr. w. As ¿ result of these developments. such as consumers. the '. This situation makes for an impoúanl bias in favor of exit when both options are present: cus_ tomer-members will ordinarily base their decision on pøsú experience rvith the cost and effectiveness of voice even though the possible iliscoøerE of lower cost and greater effectiveness is of the very essence of voice. once voice is recognized as a mechanism with considerable usefulness for maintaining performance. i \ I i I I i i ! i i I c¿. made such progress in this regard that there is now talk of a "consumer revolution" as p¿rt of the general "participation explosion. 80-88.{ . ?.s r. in comparison to other interest groups. . institutions can be desigrred in such a v¡ay that the cost of individual and collective action would be decreased.nnet e (March 1968).ls The appointment since L964 of a eonsumer adviser to the President has been a response to this emergence of the consumer voice which was quite unexpected in an economy v¡here competition-exit is supposetl to solve most of the "sovereign" consumer's problems. 16. in fact.ithin the contêxt of cortrmuÌity act¡on in Venezuela. ffi argued. especiâlly as a substitute for exit. Or.-uen raises some doubts r¡¡hether the structural constr¿ints de_ serve to be c¿lled "basic" when they ean suddenly be over_ come by a single individual such as Ralph Nader. see List Redfield pezltie. in some situations.@-ms ffi ffi ffi i I #. is brought out in his article "The Great Äme¡ican GW. the rewar ds for successful action might be increased for those ¡rho had initiated it." Th.art" of eliciting voice. 4Z ffi i I i .A-nn Arbor." The former phrase does not refer to the long established and still quite useful consumet research organizations._voice is essentially an ¿rf cgnstanfly evolving in new directions. ¿l¡atton o.'Í :4 ifr JB . the next chapter. For another. nàóe"T e*perie"ce .* . Traditionally such fi¡ms have been engaged in considerable "auscultation" of voice through market survJysi 17. most vivid case in point.$ Exit.no. Þp. the most spectacular and resourceful being the campaigns of Ralph Nader.ø. November 21. who has established himself as a sort of seìf-appointed consumer ombudsman.e Borrio (.t of the ArrLer¿cdn Insli_ tute oÍ Plø. with respect to both products and action..! ¡èãdìn@ ant . tàiJ time in lãw_incomã neighborhoods of American cities. Mich. 1968. While structu¡al constr¡i¡ts lqwcilability of close substi i . ch. the territorlf left to it remains both considerable and somewhat ill-deflnecl.

","static_promo_banner_cta_url":"https://www.scribd.com/"},"eligible_for_exclusive_trial_roadblock":false,"eligible_for_seo_roadblock":false,"exclusive_free_trial_roadblock_props_path":"/doc-page/exclusive-free-trial-props/245767423","flashes":[],"footer_props":{"urls":{"about":"/about","press":"/press","blog":"http://literally.scribd.com/","careers":"/careers","contact":"/contact","plans_landing":"/subscribe","referrals":"/referrals?source=footer","giftcards":"/giftcards","faq":"/faq","accessibility":"/accessibility-policy","faq_paths":{"accounts":"https://support.scribd.com/hc/sections/202246346","announcements":"https://support.scribd.com/hc/sections/202246066","copyright":"https://support.scribd.com/hc/sections/202246086","downloading":"https://support.scribd.com/hc/articles/210135046","publishing":"https://support.scribd.com/hc/sections/202246366","reading":"https://support.scribd.com/hc/sections/202246406","selling":"https://support.scribd.com/hc/sections/202246326","store":"https://support.scribd.com/hc/sections/202246306","status":"https://support.scribd.com/hc/en-us/articles/360001202872","terms":"https://support.scribd.com/hc/sections/202246126","writing":"https://support.scribd.com/hc/sections/202246366","adchoices":"https://support.scribd.com/hc/articles/210129366","paid_features":"https://support.scribd.com/hc/sections/202246306","failed_uploads":"https://support.scribd.com/hc/en-us/articles/210134586-Troubleshooting-uploads-and-conversions","copyright_infringement":"https://support.scribd.com/hc/en-us/articles/210128946-DMCA-copyright-infringement-takedown-notification-policy","end_user_license":"https://support.scribd.com/hc/en-us/articles/210129486","terms_of_use":"https://support.scribd.com/hc/en-us/articles/210129326-General-Terms-of-Use"},"publishers":"/publishers","static_terms":"/terms","static_privacy":"/privacy","copyright":"/copyright","ios_app":"https://itunes.apple.com/us/app/scribd-worlds-largest-online/id542557212?mt=8&uo=4&at=11lGEE","android_app":"https://play.google.com/store/apps/details?id=com.scribd.app.reader0&hl=en","books":"/books","sitemap":"/directory"}},"global_nav_props":{"header_props":{"logo_src":"/images/landing/home2_landing/scribd_logo_horiz_small.svg","root_url":"https://www.scribd.com/","search_term":"","small_logo_src":"/images/logos/scribd_s_logo.png","uploads_url":"/upload-document","search_props":{"redirect_to_app":true,"search_url":"/search","query":"","search_page":false}},"user_menu_props":null,"sidebar_props":{"urls":{"bestsellers":"https://www.scribd.com/bestsellers","home":"https://www.scribd.com/","saved":"/saved","subscribe":"/archive/pmp_checkout?doc=245767423&metadata=%7B%22context%22%3A%22pmp%22%2C%22action%22%3A%22start_trial%22%2C%22logged_in%22%3Afalse%2C%22platform%22%3A%22web%22%7D","top_charts":"/bestsellers","upload":"https://www.scribd.com/upload-document"},"categories":{"book":{"icon":"icon-ic_book","icon_filled":"icon-ic_book_fill","url":"https://www.scribd.com/books","name":"Books","type":"book"},"news":{"icon":"icon-ic_articles","icon_filled":"icon-ic_articles_fill","url":"https://www.scribd.com/news","name":"News","type":"news"},"audiobook":{"icon":"icon-ic_audiobook","icon_filled":"icon-ic_audiobook_fill","url":"https://www.scribd.com/audiobooks","name":"Audiobooks","type":"audiobook"},"magazine":{"icon":"icon-ic_magazine","icon_filled":"icon-ic_magazine_fill","url":"https://www.scribd.com/magazines","name":"Magazines","type":"magazine"},"document":{"icon":"icon-ic_document","icon_filled":"icon-ic_document_fill","url":"https://www.scribd.com/docs","name":"Documents","type":"document"},"sheet_music":{"icon":"icon-ic_songbook","icon_filled":"icon-ic_songbook_fill","url":"https://www.scribd.com/sheetmusic","name":"Sheet Music","type":"sheet_music"}},"nav_categories":["mixed","book","audiobook","magazine","document","sheet_music"],"selected_content_type":"mixed","username":"","search_overlay_props":{"search_input_props":{"focused":false,"keep_suggestions_on_blur":false}}}},"recommenders":{"related_titles_recommender":{"ids":[371480857,272513345,390188205,288041550,259116545,319267819,321677764,142827796,53693512,53297648,311692498,365046788,210570463,55353791,125523024,74023996,359198154,315235043,315431407,123771408,87030645,373910891,210282358,325024564,126363020,38137815,358613330,380209681,380187374,282565584,246054328,294133010,313945190,334045189,286758748,286758440,334045210,321283113,270998297,223649766,188006019,211709974,237841238,236204187,234828423,211709767,236202394],"title_link":null,"title":null,"track_opts":{"compilation_id":"ruLBmvwT+9wHXbJ+wLc5y6BZkac=","module_id":"QHIl3leawPXAp8tM0B3/SxzUQNg=","widget_name":"right sidebar","track_id":"flattened_recommender"}},"footer_recommenders":{"recommenders":[{"ids":[371480857,272513345,390188205,288041550,259116545,319267819,321677764,142827796,53693512,53297648,311692498,365046788,210570463,55353791,125523024,74023996,359198154,315235043,315431407,123771408,87030645,373910891,210282358,325024564,126363020,38137815,358613330,380209681,380187374,282565584],"title_link":null,"title":"Documents Similar To Exit, Voice, and Loyalty","track_opts":{"compilation_id":"ruLBmvwT+9wHXbJ+wLc5y6BZkac=","module_id":"TF+0UJh+WZyU2fvaOhkIpS2doPY=","widget_name":"document_carousel"}},{"ids":[246054328,294133010,313945190,334045189,286758748,286758440,334045210,321283113,270998297,223649766,188006019,211709974,237841238,236204187,234828423,211709767,236202394],"title_link":null,"title":"More From ryanghlee","track_opts":{"compilation_id":"ruLBmvwT+9wHXbJ+wLc5y6BZkac=","module_id":"w1Xaaw5ZB8Judt1To0ddhWNtONU=","widget_name":"document_carousel"}}]},"seo_new_docs_recommenders":{"recommenders":[]},"documents":{"38137815":{"type":"document","id":38137815,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/38137815/149x198/7000753c4f/1285660795?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/38137815/298x396/539b95f738/1285660795?v=1","title":"6893093-The-economics-of-tourism","short_title":"6893093-The-economics-of-tourism","author":"shinyshani85","tracking":{"object_type":"document","object_id":38137815,"track":"flattened_recommender","doc_uuid":"rWytUdKfrEgfhMrY8BJmkDRA+48="},"url":"https://www.scribd.com/document/38137815/6893093-The-economics-of-tourism","top_badge":null},"53297648":{"type":"document","id":53297648,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/53297648/149x198/343b6e55db/1381273691?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/53297648/298x396/74acab7f4a/1381273691?v=1","title":"economics","short_title":"economics","author":"Jasmin Raichel","tracking":{"object_type":"document","object_id":53297648,"track":"flattened_recommender","doc_uuid":"gpGhSOcwcrguKVwwEAsf+bpKAjI="},"url":"https://www.scribd.com/document/53297648/economics","top_badge":null},"53693512":{"type":"document","id":53693512,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/53693512/149x198/83fa81732a/1480004456?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/53693512/298x396/8cdc2726f6/1480004456?v=1","title":"Exit Voice Loyalty-Hirschman","short_title":"Exit Voice Loyalty-Hirschman","author":"Pasan Wijesiri","tracking":{"object_type":"document","object_id":53693512,"track":"flattened_recommender","doc_uuid":"iKi6Ybww1I7x648jQra/Eb11m6o="},"url":"https://www.scribd.com/doc/53693512/Exit-Voice-Loyalty-Hirschman","top_badge":null},"55353791":{"type":"document","id":55353791,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/55353791/149x198/7ef2a46c55/1305284668?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/55353791/298x396/7cba3cce59/1305284668?v=1","title":"Lecture Week 1 Introduction","short_title":"Lecture Week 1 Introduction","author":"jtzamora05","tracking":{"object_type":"document","object_id":55353791,"track":"flattened_recommender","doc_uuid":"QCxNHorSfNWy5SfMVtiC4407CtI="},"url":"https://www.scribd.com/presentation/55353791/Lecture-Week-1-Introduction","top_badge":null},"74023996":{"type":"document","id":74023996,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/74023996/149x198/9f20ec5744/1399940416?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/74023996/298x396/ec517599d2/1399940416?v=1","title":"Derivatives","short_title":"Derivatives","author":"Rylie Silver","tracking":{"object_type":"document","object_id":74023996,"track":"flattened_recommender","doc_uuid":"2zYOOkW13oABdOAcoXpPAsq+ZLI="},"url":"https://www.scribd.com/document/74023996/Derivatives","top_badge":null},"87030645":{"type":"document","id":87030645,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/87030645/149x198/0a941e2d81/1332938147?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/87030645/298x396/769a312e52/1332938147?v=1","title":"coad a","short_title":"coad a","author":"samysahhile","tracking":{"object_type":"document","object_id":87030645,"track":"flattened_recommender","doc_uuid":"0JxAiEK13B1rO/DIBSTHKpl0EFE="},"url":"https://www.scribd.com/document/87030645/coad-a","top_badge":null},"123771408":{"type":"document","id":123771408,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/123771408/149x198/39fbc12ca2/1359992868?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/123771408/298x396/180a7f3a14/1359992868?v=1","title":"dfre","short_title":"dfre","author":"Prateek Sharma","tracking":{"object_type":"document","object_id":123771408,"track":"flattened_recommender","doc_uuid":"YV83gmHA3enHhfh+zBqnWEvDjdU="},"url":"https://www.scribd.com/presentation/123771408/dfre","top_badge":null},"125523024":{"type":"document","id":125523024,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/125523024/149x198/df3802e020/1360870451?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/125523024/298x396/6f486a2b55/1360870451?v=1","title":"Chap 1 mc","short_title":"Chap 1 mc","author":"Ilyas Sadvokassov","tracking":{"object_type":"document","object_id":125523024,"track":"flattened_recommender","doc_uuid":"iPD3MeeU71AtvF7eiQI54LIQ4WI="},"url":"https://www.scribd.com/document/125523024/Chap-1-mc","top_badge":null},"126363020":{"type":"document","id":126363020,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/126363020/149x198/c09e4b4e3d/1361355868?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/126363020/298x396/a015431939/1361355868?v=1","title":"Basic Concept of Eco","short_title":"Basic Concept of Eco","author":"Nivedita Bhalla","tracking":{"object_type":"document","object_id":126363020,"track":"flattened_recommender","doc_uuid":"p9Ac6h4ME/nN6cTKTdEOn1oLimI="},"url":"https://www.scribd.com/presentation/126363020/Basic-Concept-of-Eco","top_badge":null},"142827796":{"type":"document","id":142827796,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/142827796/149x198/6680cdaf37/1539900422?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/142827796/298x396/7aedf926de/1539900422?v=1","title":"The Soldier and the State- Huntington","short_title":"The Soldier and the State- Huntington","author":"Ashesa777","tracking":{"object_type":"document","object_id":142827796,"track":"flattened_recommender","doc_uuid":"3i9brlIWYXDPwKYtzicI0AEA1Z8="},"url":"https://www.scribd.com/doc/142827796/The-Soldier-and-the-State-Huntington","top_badge":null},"188006019":{"type":"document","id":188006019,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/188006019/149x198/57063696dd/1385751998?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/188006019/298x396/ef070bb745/1385751998?v=1","title":"Bello Fiore Concept of Labor in Marx","short_title":"Bello Fiore Concept of Labor in Marx","author":"ryanghlee","tracking":{"object_type":"document","object_id":188006019,"track":"flattened_recommender","doc_uuid":"RphEkAQhDSDrvOgrC/zD/Pz86Oo="},"url":"https://www.scribd.com/document/188006019/Bello-Fiore-Concept-of-Labor-in-Marx","top_badge":null},"210282358":{"type":"document","id":210282358,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/210282358/149x198/5f44ad5100/1393860594?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/210282358/298x396/26e3d998c6/1393860594?v=1","title":"Basic Concepts of economics\r\n","short_title":"Basic Concepts of economics\r\n","author":"ravinbharathi","tracking":{"object_type":"document","object_id":210282358,"track":"flattened_recommender","doc_uuid":"YMT1QYm8aMse4xQM9Kn3tckzQW0="},"url":"https://www.scribd.com/presentation/210282358/Basic-Concepts-of-economics","top_badge":null},"210570463":{"type":"document","id":210570463,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/210570463/149x198/bef36a63fc/1393956891?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/210570463/298x396/10d94a3ae0/1393956891?v=1","title":"Hirschman - Exit Voice Loyalty","short_title":"Hirschman - Exit Voice Loyalty","author":"Axel Alex","tracking":{"object_type":"document","object_id":210570463,"track":"flattened_recommender","doc_uuid":"Ulu//GBI19TUmf8USbk+fgoA4Y4="},"url":"https://www.scribd.com/document/210570463/Hirschman-Exit-Voice-Loyalty","top_badge":null},"211709767":{"type":"document","id":211709767,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/211709767/149x198/f2cf59ba85/1400170648?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/211709767/298x396/5f81428ab2/1400170648?v=1","title":"Acta Sociologica-2006-Halleröd-83-102","short_title":"Acta Sociologica-2006-Halleröd-83-102","author":"ryanghlee","tracking":{"object_type":"document","object_id":211709767,"track":"flattened_recommender","doc_uuid":"3OF5yZrE5U0j/E/2+qXKgZsydwE="},"url":"https://www.scribd.com/document/211709767/Acta-Sociologica-2006-Hallero-d-83-102","top_badge":null},"211709974":{"type":"document","id":211709974,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/211709974/149x198/5f75fc038a/1394483643?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/211709974/298x396/3ad1b96f04/1394483643?v=1","title":"Brecht Born Later","short_title":"Brecht Born Later","author":"ryanghlee","tracking":{"object_type":"document","object_id":211709974,"track":"flattened_recommender","doc_uuid":"rU6oTRW3Y5FghrPhdzhB37DU9eE="},"url":"https://www.scribd.com/document/211709974/Brecht-Born-Later","top_badge":null},"223649766":{"type":"document","id":223649766,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/223649766/149x198/abe50f70d9/1445426815?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/223649766/298x396/192fc4ef09/1445426815?v=1","title":"Andrea Smith Unsettling the Privilege of Self-Reflexivity","short_title":"Andrea Smith Unsettling the Privilege of Self-Reflexivity","author":"ryanghlee","tracking":{"object_type":"document","object_id":223649766,"track":"flattened_recommender","doc_uuid":"OJCDIJhcpP9aGrx+uySB5ekWB+I="},"url":"https://www.scribd.com/document/223649766/Andrea-Smith-Unsettling-the-Privilege-of-Self-Reflexivity","top_badge":null},"234828423":{"type":"document","id":234828423,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/234828423/149x198/52cce53c68/1406081317?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/234828423/298x396/35b21cd492/1406081317?v=1","title":"Origins Inequality","short_title":"Origins Inequality","author":"ryanghlee","tracking":{"object_type":"document","object_id":234828423,"track":"flattened_recommender","doc_uuid":"3mEzZSDOHYW2zyQpRyPOF34RH7Q="},"url":"https://www.scribd.com/document/234828423/Origins-Inequality","top_badge":null},"236202394":{"type":"document","id":236202394,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/236202394/149x198/498e27dcc4/1407478568?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/236202394/298x396/6de36cfcba/1407478568?v=1","title":"P Mattick - Luxemburg in Retrospect","short_title":"P Mattick - Luxemburg in Retrospect","author":"ryanghlee","tracking":{"object_type":"document","object_id":236202394,"track":"flattened_recommender","doc_uuid":"KoxbnrTC2GcDIarl+MMu6VrBXkQ="},"url":"https://www.scribd.com/document/236202394/P-Mattick-Luxemburg-in-Retrospect","top_badge":null},"236204187":{"type":"document","id":236204187,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/236204187/149x198/5f3fd9e276/1407480875?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/236204187/298x396/7b0ca3c030/1407480875?v=1","title":"Ivan Chase, Vacancy Chains","short_title":"Ivan Chase, Vacancy Chains","author":"ryanghlee","tracking":{"object_type":"document","object_id":236204187,"track":"flattened_recommender","doc_uuid":"3I89VzJrp3AG3cL4uAApL9jzOOk="},"url":"https://www.scribd.com/document/236204187/Ivan-Chase-Vacancy-Chains","top_badge":null},"237841238":{"type":"document","id":237841238,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/237841238/149x198/51aef4fc1f/1409116622?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/237841238/298x396/88940c50bc/1409116622?v=1","title":"HC White, Mobilizing Identity - Uncertainty & Control Copy","short_title":"HC White, Mobilizing Identity - Uncertainty & Control Copy","author":"ryanghlee","tracking":{"object_type":"document","object_id":237841238,"track":"flattened_recommender","doc_uuid":"+7/AQyk/y52Yg5U0ckmEJ/D48Ao="},"url":"https://www.scribd.com/document/237841238/HC-White-Mobilizing-Identity-Uncertainty-Control-Copy","top_badge":null},"246054328":{"type":"document","id":246054328,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/246054328/149x198/19ad2f8580/1415579588?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/246054328/298x396/05a3cf24ae/1415579588?v=1","title":" Gordon is US Growth Over","short_title":" Gordon is US Growth Over","author":"ryanghlee","tracking":{"object_type":"document","object_id":246054328,"track":"flattened_recommender","doc_uuid":"szm6AwFbSIRo/ThUJzHpupyBWvE="},"url":"https://www.scribd.com/doc/246054328/Gordon-is-US-Growth-Over","top_badge":null},"259116545":{"type":"document","id":259116545,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/259116545/149x198/d5afbf3c39/1426655254?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/259116545/298x396/b6eb9ef153/1426655254?v=1","title":"Economics micro economics","short_title":"Economics micro economics","author":"jo","tracking":{"object_type":"document","object_id":259116545,"track":"flattened_recommender","doc_uuid":"bnnBNPeozKh3LBHNyV8JDYWdzE4="},"url":"https://www.scribd.com/document/259116545/Economics-micro-economics","top_badge":null},"270998297":{"type":"document","id":270998297,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/270998297/149x198/1c4091365c/1436426663?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/270998297/298x396/1c371bd15f/1436426663?v=1","title":"Cedric Johnson_The Negro Revolution and Cold War America-Revolutionary Politics & Racial Conservatism in the Work of Harold Cruse (2007)","short_title":"Cedric Johnson_The Negro Revolution and Cold War America-Revolutionary Politics & Racial Conservatism in the Work of Harold Cruse (2007)","author":"ryanghlee","tracking":{"object_type":"document","object_id":270998297,"track":"flattened_recommender","doc_uuid":"8jvumPAfOlR9y/2j+6LkdJC/0Mc="},"url":"https://www.scribd.com/document/270998297/Cedric-Johnson-The-Negro-Revolution-and-Cold-War-America-Revolutionary-Politics-Racial-Conservatism-in-the-Work-of-Harold-Cruse-2007","top_badge":null},"272513345":{"type":"document","id":272513345,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/272513345/149x198/0d7510ee58/1437775427?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/272513345/298x396/c6e0c35386/1437775427?v=1","title":"Economic Principles and Skills 1 2014-15 Handout","short_title":"Economic Principles and Skills 1 2014-15 Handout","author":"adastfe","tracking":{"object_type":"document","object_id":272513345,"track":"flattened_recommender","doc_uuid":"7g9KiQRwI5IKAqcUvPOK7y6n2Io="},"url":"https://www.scribd.com/document/272513345/Economic-Principles-and-Skills-1-2014-15-Handout","top_badge":null},"282565584":{"type":"document","id":282565584,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/282565584/149x198/b1dfcc744e/1443077552?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/282565584/298x396/11d886751a/1443077552?v=1","title":"ECON 312 Week 4 Midterm Exam.docx","short_title":"ECON 312 Week 4 Midterm Exam.docx","author":"davidslewis","tracking":{"object_type":"document","object_id":282565584,"track":"flattened_recommender","doc_uuid":"JNUNO/Nvaq5Jww5+ToYs9Wu+7Yo="},"url":"https://www.scribd.com/document/282565584/ECON-312-Week-4-Midterm-Exam-docx","top_badge":null},"286758440":{"type":"document","id":286758440,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/286758440/149x198/a31faaf832/1445656154?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/286758440/298x396/45d41e226d/1445656154?v=1","title":"Race, Articulation and Societies Structured in Dominance","short_title":"Race, Articulation and Societies Structured in Dominance","author":"ryanghlee","tracking":{"object_type":"document","object_id":286758440,"track":"flattened_recommender","doc_uuid":"qRwrY90bzJGrs20n7Ga+omh84lc="},"url":"https://www.scribd.com/doc/286758440/Race-Articulation-and-Societies-Structured-in-Dominance","top_badge":null},"286758748":{"type":"document","id":286758748,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/286758748/149x198/2ce04dde17/1445656237?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/286758748/298x396/be3f8f6d98/1445656237?v=1","title":"LRBW Study Guide","short_title":"LRBW Study Guide","author":"ryanghlee","tracking":{"object_type":"document","object_id":286758748,"track":"flattened_recommender","doc_uuid":"brhOZ/EBW3qIr1HDRULdb6GRvPM="},"url":"https://www.scribd.com/document/286758748/LRBW-Study-Guide","top_badge":null},"288041550":{"type":"document","id":288041550,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/288041550/149x198/bb05fb1f79/1446325099?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/288041550/298x396/3ba9bd09b8/1446325099?v=1","title":"Managerial Economics-Course Handout","short_title":"Managerial Economics-Course Handout","author":"Dhruv Bhandari","tracking":{"object_type":"document","object_id":288041550,"track":"flattened_recommender","doc_uuid":"RmS+XnBZ32fvwiHsvGWGl/NprzU="},"url":"https://www.scribd.com/document/288041550/Managerial-Economics-Course-Handout","top_badge":null},"294133010":{"type":"document","id":294133010,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/294133010/149x198/4cf0abd0af/1451290771?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/294133010/298x396/799c1c07ca/1451290771?v=1","title":"Crafts O'Rourke, Twentieth Century Growth","short_title":"Crafts O'Rourke, Twentieth Century Growth","author":"ryanghlee","tracking":{"object_type":"document","object_id":294133010,"track":"flattened_recommender","doc_uuid":"fsRh8q8Hna8aL+3tawtdTuwWxh0="},"url":"https://www.scribd.com/doc/294133010/Crafts-O-Rourke-Twentieth-Century-Growth","top_badge":null},"311692498":{"type":"document","id":311692498,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/311692498/149x198/0a6ed98789/1462525682?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/311692498/298x396/cbd2d92547/1462525682?v=1","title":"Managerialeconomicsrelationship 150313092502 Conversion Gate01","short_title":"Managerialeconomicsrelationship 150313092502 Conversion Gate01","author":"Srinu Madem","tracking":{"object_type":"document","object_id":311692498,"track":"flattened_recommender","doc_uuid":"3OTXD0utbK47tIk00RU4eYATsp0="},"url":"https://www.scribd.com/presentation/311692498/Managerialeconomicsrelationship-150313092502-Conversion-Gate01","top_badge":null},"313945190":{"type":"document","id":313945190,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/313945190/149x198/0b6a0dd2be/1464303438?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/313945190/298x396/16c2fdec5a/1464303438?v=1","title":"Breaktheirhaughtypower.org-Facing Reality 45 Years Later Critical Dialogue With JamesLeeChaulieu","short_title":"Breaktheirhaughtypower.org-Facing Reality 45 Years Later Critical Dialogue With JamesLeeChaulieu","author":"ryanghlee","tracking":{"object_type":"document","object_id":313945190,"track":"flattened_recommender","doc_uuid":"mRagPPfavyWyzomwFAcOlIayaQI="},"url":"https://www.scribd.com/document/313945190/Breaktheirhaughtypower-org-Facing-Reality-45-Years-Later-Critical-Dialogue-With-JamesLeeChaulieu","top_badge":null},"315235043":{"type":"document","id":315235043,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/315235043/149x198/57b2b9f6cb/1465455981?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/315235043/298x396/10da330496/1465455981?v=1","title":"Introduction to Managerial Economics","short_title":"Introduction to Managerial Economics","author":"mussaiyib","tracking":{"object_type":"document","object_id":315235043,"track":"flattened_recommender","doc_uuid":"X5X7yj2eJ/jEwK/0Fve+k/4PM9M="},"url":"https://www.scribd.com/document/315235043/Introduction-to-Managerial-Economics","top_badge":null},"315431407":{"type":"document","id":315431407,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/315431407/149x198/a52dc64b03/1465660408?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/315431407/298x396/4d35672573/1465660408?v=1","title":"dgdfdgsefdsgdfgdhg","short_title":"dgdfdgsefdsgdfgdhg","author":"babylovelylovely","tracking":{"object_type":"document","object_id":315431407,"track":"flattened_recommender","doc_uuid":"Au7zDCsLt1jg7NMTfwXgVPWvK3c="},"url":"https://www.scribd.com/doc/315431407/dgdfdgsefdsgdfgdhg","top_badge":null},"319267819":{"type":"document","id":319267819,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/319267819/149x198/930860d5a3/1537985097?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/319267819/298x396/544c6e465c/1537985097?v=1","title":"Exit%2c Voice and Loyalty - Responses to Declines in Firms%2c Organizations and States.pdf","short_title":"Exit%2c Voice and Loyalty - Responses to Declines in Firms%2c Organizations and States.pdf","author":"Carlos Eduardo Jiménez Rubiano","tracking":{"object_type":"document","object_id":319267819,"track":"flattened_recommender","doc_uuid":"QkyxvDWpXcgfwmHXEURKZWj0OQs="},"url":"https://www.scribd.com/document/319267819/Exit-2c-Voice-and-Loyalty-Responses-to-Declines-in-Firms-2c-Organizations-and-States-pdf","top_badge":null},"321283113":{"type":"document","id":321283113,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/321283113/149x198/9909eb12a9/1471305121?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/321283113/298x396/584f6d9e07/1471305121?v=1","title":"Donzelot Anti Sociology","short_title":"Donzelot Anti Sociology","author":"ryanghlee","tracking":{"object_type":"document","object_id":321283113,"track":"flattened_recommender","doc_uuid":"QrrA85j+laSi5GJPlmHGneskJgo="},"url":"https://www.scribd.com/document/321283113/Donzelot-Anti-Sociology","top_badge":null},"321677764":{"type":"document","id":321677764,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/321677764/149x198/eb30642cce/1471616775?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/321677764/298x396/3990d12115/1471616775?v=1","title":"Course Syllabus for Applied Economics (Public Offering)","short_title":"Course Syllabus for Applied Economics (Public Offering)","author":"Lester G Cavestany","tracking":{"object_type":"document","object_id":321677764,"track":"flattened_recommender","doc_uuid":"81Z5mpldE5I80aHMMH+xDCJ2YDI="},"url":"https://www.scribd.com/document/321677764/Course-Syllabus-for-Applied-Economics-Public-Offering","top_badge":null},"325024564":{"type":"document","id":325024564,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/325024564/149x198/d9715119c1/1474634819?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/325024564/298x396/ff8781ac3d/1474634819?v=1","title":"Topic 0 - Preface","short_title":"Topic 0 - Preface","author":"John Ho","tracking":{"object_type":"document","object_id":325024564,"track":"flattened_recommender","doc_uuid":"Ccoe4ZzFQzJoFAR/X3ZmiV4+Hyw="},"url":"https://www.scribd.com/document/325024564/Topic-0-Preface","top_badge":null},"334045189":{"type":"document","id":334045189,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/334045189/149x198/8b3a4c866d/1481603762?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/334045189/298x396/b040f6129b/1481603762?v=1","title":"Cavailles & Lautman, Mathematical Thought.pdf","short_title":"Cavailles & Lautman, Mathematical Thought.pdf","author":"ryanghlee","tracking":{"object_type":"document","object_id":334045189,"track":"flattened_recommender","doc_uuid":"tH1E9Q43/SGC/wDiRXs2rln2+/w="},"url":"https://www.scribd.com/document/334045189/Cavailles-Lautman-Mathematical-Thought-pdf","top_badge":null},"334045210":{"type":"document","id":334045210,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/334045210/149x198/b460fb3e97/1481603758?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/334045210/298x396/f3f3012a7b/1481603758?v=1","title":"Vaclav Smil, Energy in 20th Century","short_title":"Vaclav Smil, Energy in 20th Century","author":"ryanghlee","tracking":{"object_type":"document","object_id":334045210,"track":"flattened_recommender","doc_uuid":"z9IpNwUmoqLS4mF930enliMR7oQ="},"url":"https://www.scribd.com/document/334045210/Vaclav-Smil-Energy-in-20th-Century","top_badge":null},"358613330":{"type":"document","id":358613330,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/358613330/149x198/55d7263803/1505149952?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/358613330/298x396/9ac85ff05a/1505149952?v=1","title":"Exam Prep for Microeconomic Theory PDF","short_title":"Exam Prep for Microeconomic Theory PDF","author":"Karen","tracking":{"object_type":"document","object_id":358613330,"track":"flattened_recommender","doc_uuid":"oAVpJhAZKsRswubmDTdsjT3XaM8="},"url":"https://www.scribd.com/document/358613330/Exam-Prep-for-Microeconomic-Theory-PDF","top_badge":null},"359198154":{"type":"document","id":359198154,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/359198154/149x198/f1fd4adc93/1505723053?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/359198154/298x396/dfdbf84493/1505723053?v=1","title":"ECON 312 Week 4 Midterm Exam - 3 Versions (Package)","short_title":"ECON 312 Week 4 Midterm Exam - 3 Versions (Package)","author":"Irene A. Roseberry Roseberry","tracking":{"object_type":"document","object_id":359198154,"track":"flattened_recommender","doc_uuid":"18FwYPw7e2mbPIQNuECbWePr4+4="},"url":"https://www.scribd.com/document/359198154/ECON-312-Week-4-Midterm-Exam-3-Versions-Package","top_badge":null},"365046788":{"type":"document","id":365046788,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/365046788/149x198/a5ef77d073/1511268886?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/365046788/298x396/8554d547b7/1511268886?v=1","title":"Materi Nilai Tukar Valas 1","short_title":"Materi Nilai Tukar Valas 1","author":"FerdyanWanaSaputra","tracking":{"object_type":"document","object_id":365046788,"track":"flattened_recommender","doc_uuid":"wPfKO/G20l0yhvm3CHskwtwrWXI="},"url":"https://www.scribd.com/presentation/365046788/Materi-Nilai-Tukar-Valas-1","top_badge":null},"371480857":{"type":"document","id":371480857,"thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/371480857/149x198/825d0fc9cd/1518583633?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/371480857/298x396/0e456e788e/1518583633?v=1","title":"Economics","short_title":"Economics","author":"Danilyn Manluayan Aguiadan","tracking":{"object_type":"document","object_id":371480857,"track":"flattened_recommender","doc_uuid":"T1j1RdYdRh8QujC6YEbSxst8YgQ="},"url":"https://www.scribd.com/presentation/371480857/Economics","top_badge":null},"373910891":{"type":"document","id":373910891,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/373910891/149x198/bc5c622dca/1521099493?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/373910891/298x396/040bf749db/1521099493?v=1","title":"MM(3rd)Dec2017","short_title":"MM(3rd)Dec2017","author":"lifeis1enjoy","tracking":{"object_type":"document","object_id":373910891,"track":"flattened_recommender","doc_uuid":"jJ4yAIU6MUO+lbuU7AsAn6TLNYA="},"url":"https://www.scribd.com/document/373910891/MM-3rd-Dec2017","top_badge":null},"380187374":{"type":"document","id":380187374,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/380187374/149x198/39608f9148/1527291342?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/380187374/298x396/4cb27e2334/1527291342?v=1","title":"Test Bank for Macroeconomics 2nd Edition by James","short_title":"Test Bank for Macroeconomics 2nd Edition by James","author":"a739202104","tracking":{"object_type":"document","object_id":380187374,"track":"flattened_recommender","doc_uuid":"mGhjpkfpcet3IhmdM5CzvKZrtb8="},"url":"https://www.scribd.com/document/380187374/Test-Bank-for-Macroeconomics-2nd-Edition-by-James","top_badge":null},"380209681":{"type":"document","id":380209681,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/380209681/149x198/993b1ae5ab/1527318975?v=1","retina_thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/380209681/298x396/4ea05a75a6/1527318975?v=1","title":"Test Bank for Microeconomics 2nd Canadian Edition by James","short_title":"Test Bank for Microeconomics 2nd Canadian Edition by James","author":"a688942378","tracking":{"object_type":"document","object_id":380209681,"track":"flattened_recommender","doc_uuid":"emHzt30YoITT5z/TnL3i2DNP3hQ="},"url":"https://www.scribd.com/document/380209681/test-bank-for-microeconomics-2nd-canadian-edition-by-james","top_badge":null},"390188205":{"type":"document","id":390188205,"thumb_url":"https://imgv2-1-f.scribdassets.com/img/document/390188205/149x198/40dafb8f21/1538750544?v=1","retina_thumb_url":"https://imgv2-2-f.scribdassets.com/img/document/390188205/298x396/8f9ceca17e/1538750544?v=1","title":"f2016051115051344461838.pdf","short_title":"f2016051115051344461838.pdf","author":"kahfibsya","tracking":{"object_type":"document","object_id":390188205,"track":"flattened_recommender","doc_uuid":"eiNqUcGt7vcDzThXLiynrcRR6UA="},"url":"https://www.scribd.com/document/390188205/f2016051115051344461838-pdf","top_badge":null}}},"seo_roadblock_props_path":"/doc-page/seo-roadblock-props/245767423","signup_context":null,"toolbar":{"search_path":"/search-4gen?allowed_pages=1%2C2&auth_token=7Nzwu1dOFT5qvhP8cHMQ1inGvMU%3D&authenticity_token=TPeH2%2BIKhv9RVnGHXxgcCg2PWN5tVjUYBZcY7Ug9LO5GgXuDjExW5xHc1un6vlSw11EzdwfDXqMR3NUEdHNSYA%3D%3D&expires=1540914968&wordDocumentId=245767423&wordUploadId=250327259"},"renewal_nag_props":null}-->