Veblen, Thorstein Bunde (1857–1929)

Thorstein Bunde Veblen, born in the United States (where he lived and worked all his life) to Norwegian immigrant parents, held faculty posts at Chicago, Stanford, and Missouri universities. He was best known for coining the terms conspicuous consumption and leisure class, as a founder of institutional economics and evolutionary economics, and for his satirical, polemic style of writing.

Contrary to the classical economics of his time, Veblen argued that economic behavior, specifically how businesses were run, was determined socially, not individually. He also argued that economic life, including forms of business organization, was in a process of continuous evolution—that nothing could be relied on to last.

Veblen was a fierce critic of the kind of industrial capitalism that was becoming dominant in the United States by the end of the nineteenth century. He was critical of how ownership of major enterprises was in the hands of a moneyed class (we would now call them finance capitalists) who exploited the people who worked, invented, and ran businesses. Veblen's view was that, alongside their virtues, markets generated waste, fraud, and, in America, had created idle, parasitic elites, whom he called a leisure class.

Veblen's first and best-known book, The Theory of the Leisure Class, was originally published in 1899 and was an attack on the wasteful lifestyles of America's leisure class. Members were said to advertise their success through ostentatious display, the conspicuous consumption of manifestly useless objects such as jewelry and gambling in casinos. Nowadays we would call these objects “positional goods” whose value rests on other people not possessing them. Conspicuous consumption, in Veblen's work, earned status in a similar way to Pierre Bourdieu's cultural and symbolic capital.

As a founder of evolutionary economics, which still has adherents, Veblen was confident that the American capitalism of his lifetime would be temporary. He was not a Marxist. He did not anticipate a proletarian revolution and the end of capitalism. Rather, he hoped and expected that the human instinct of workmanship would be reasserted. Engineers were Veblen's heroes.

Veblen was prolific. He published ten books and scores of articles, but his immediate influence was confined to narrow bands of followers in the subdis-ciplines that he helped to create: institutional economics and evolutionary economics. Although Veblen's work was sociological, it never became part of core sociology courses. He was a lost theorist until interest in consumption and leisure soared in the late-twentieth century, whereupon Veblen was rediscovered. The term conspicuous consumption had previously become detached from Veblen's theory of the leisure class in which it was originally embedded. The term entered everyday use, and for most of the twentieth century, most users were probably completely unaware of its first author. It is different today. Veblen is sometimes claimed as a founding father, or forefather, of the contemporary study of consumption and [Page 1504]leisure, but this claim is misleading, and it is possible only in misunderstanding how Veblen used the terms leisure class and conspicuous consumption.

The study of leisure since the 1960s has been about the leisure of workers, not a work-free leisure class that is able to live off the wealth created by others. Today, fabulously wealthy individuals appear to be the opposite of Veblen's leisure class: their entire lifestyles appear work centered. Veblen saw conspicuous consumption as an enemy of technological and economic progress. Today, consumption, conspicuous and inconspicuous, is typically regarded as a key driver of the economy. An advertising industry manufactures desire. High earners who are genuine workers make their success known through the positional goods that they are able to display, particularly their houses and automobiles. Consumption is increasingly seen as fundamental to identity development and maintenance in all social strata. This is neither what Veblen wrote about nor what he envisaged for America.

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