Thorstein Veblen (1857-1929) is known in sociology for his famous work on conspicuous consumption. He also shares with the classical theorists of his day a focal interest in issues relating to production, especially the contradiction between the potential of industrial production to fulfill society's needs and the interests of businessmen to earn a profit.
Veblen's work is influenced by a range of social thinkers, including Karl Marx, evolutionary thinkers like Herbert Spencer, and economists like Adam Smith.
Both Veblen and Marx share a materialist perspective that holds that society is shaped by the means of procuring a livelihood. Yet, while Marx thought that labor was the creative force in society, Veblen sees the industrial arts, especially technology, as creative forces.
Influenced by Darwin and the Social Darwinists, Veblen views society as being dominated by the struggle for existence, with the fittest social institutions and habits of thought surviving. Still, the selective adaptation that lies at the core of evolution is never totally successful, because institutions adapted from the past can never catch up with changing social circumstances. Veblen's two-stage model of social evolution posits the development from primitive societies characterized by peace and cooperation, and predatory barbarism characterized by its warlike and competitive character. A key aspect of this process is the shift from free workmanship in primitive societies to the control of industry by pecuniary interests under barbarism.
Although Veblen was known in his lifetime as an economist, he thought that most economic theory was static, hedonistic, rationalistic, teleological, and deductive. His work sought to focus on larger cultural and institutional issues instead of making theoretical deductions.
Veblen has a strong sense of human nature and its importance in social life. He thought that the primary human instinct was an instinct of workmanship involving the efficient use of available means and adequate management of available resources. The parental bent (an unselfish solicitude of the well-being of the incoming generation), idle curiosity, and the desire to emulate persons of distinction and achievement are also important instincts. In addition to human nature, the industrial arts (technological knowledge) are a common stock of knowledge, skill, and technique that play a major role in shaping society.
Veblen operates with a theory of cultural lag in which advances in science and technology outpace changes in the system of law and custom. From his point of view, cultural artifacts like the right of ownership have become a barrier to the progress of the industrial arts. Societies not only develop their own industrial arts, but they also borrow from other cultures. Borrowed ideas have great utility because they come to their new culture without the excess baggage of ritual restricts. Borrowing cultures also have the advantage of being able to create new versions of innovations more quickly than innovating cultures that are liable to get mired in the legacy of their achievements.
The Theory of the Leisure Class
In The Theory of the Leisure Class, Veblen argues that under predatory barbarism, social honor is based on demonstrating tangible evidence of prowess and aggression. Under this system, private property becomes the basis of esteem and everyone in society seeks to emulate those who have a great deal of it. In an earlier era, wealth was seen as evidence of the instinct of workmanship, but more recently wealth itself is understood to be meritorious. Originally, the leisure class sought to demonstrate its wealth by ostentatiously not working — it consumed time nonproductively out of a sense that productive work was unworthy. But, as industrial society evolved, conspicuous consumption became the most practical way to demonstrate one's wealth to a transient population. The leisure class is expected to consume the best in food, drink, narcotics, shelter, services, ornaments, apparel, amusements, and so on. Because the leisure class stands at the pinnacle of the stratification system, it is incumbent on all classes that rank below them to emulate the way they live.
The consequence of this system of invidious distinction is waste. While people do not usually waste time and money intentionally, they do so in a wish to conform to the accepted canons of decency in society. Veblen rails against such wasteful expenditures as the ownership of pets and the use of beauty products. Overall, the leisure class is associated with waste, futility, and ferocity, and it stands in opposition to the needs of industrial society to efficiently distribute goods—they are the embodiment of the cultural lag.
Business and Industry
Veblen sees an inherent conflict between what he calls, somewhat idiosyncratically, business and industry. Veblen's two-class model of social stratification includes a business class, which owns wealth invested in large holdings, and an industrial class, whose conditions of life are controlled by others and who live by work. On the one hand, today's business leaders are almost exclusively concerned with financial matters—especially profit—and make no contribution to production. Veblen sees these captains of industry as parasitic and exploitative. On the other hand, industry is oriented toward workmanship and production. Unlike the businessman's pecuniary orientation, the industrial orientation is an impersonal standpoint of quantitative relations and mechanical efficiency.
Business leaders obstruct the operation of the industrial system. For example, business leaders attribute the yields of the modern industrial system—what Veblen called free income—to intangibles like patents. Such intangibles impede the ability of the industrial system to produce as much as possible. Similarly, Veblen argues that prices are kept artificially high by sabotaging production. For these reasons, industrial society would be run most efficiently by production engineers who would look out for the welfare of all members of society rather than the vested interests of business.
Veblen also investigated the effects of business interests on higher education, suggesting that the American educational system could be more profitably directed toward serving the needs of industry. Veblen believed that the university should be dedicated primarily to scientific and scholarly inquiry rather than to undergraduate education. He thought that undergraduates would be better served in professional and technical schools where practical knowledge could be imparted efficiently without corrupting the university's essentially impractical mission. University administrators are too oriented toward business and stand in opposition to science and scholarship because they seek to run the university with businesslike efficiency. For example, Veblen was critical of the university's interest in competition with other universities. He thought that this impulse too often resulted in wasteful expenditures like manicured lawns and expensive buildings. Similarly, the faculty does quasi-science dedicated to supporting the status quo rather than real science. Veblen holds out little hope of the academic world changing until the larger economic system is overhauled.
Veblen approached politics in much the same way he did the economy. He saw political leaders as tools of the captains of industry. Too often, he believed, the government takes action to serve the interests of business leaders abroad without considering the international development of industry. Tariffs and wars are examples of the predatory behaviors of nations acting to fortify the interests of business leaders.