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Stephen Edgell, _Veblen in Perspective: His Life and Thought_. Armonk, NY: 
M.E. Sharpe, 2001. xiii + 209 pp. $22.95 (paper), ISBN: 1-56324-117-x. 
 
Reviewed for EH.NET by Donald Stabile, Department of Economics, St. Mary's 
College of Maryland. <[log in to unmask]> 
 
 
Does Thorstein Veblen still deserve consideration from economists? After 
all, his most famous book, _The Theory of the Leisure Class_, appeared over 
a century ago. Edgell's book on Veblen makes the case that he does. A 
professor of sociology at Salford University in England, Edgell stresses 
Veblen's linkages with his own discipline. Much of his book's content will 
be of interest only to Veblen scholars. Still, economists can profit from 
reading it. 
 
To support his contention that Veblen's ideas have enduring value, Edgell 
first removes some of the mystery that surrounds Veblen's personality and 
ideas. That mystery has existed ever since. Joseph Dorfman published an 
extensive biography of Veblen, _Thorstein Veblen and His America_, in 1934. 
In it, he portrayed Veblen as a detached, lonesome loser, who viewed the 
U.S. as if he were from another planet. Edgell argues that by slanting his 
data, Dorfman misinterpreted Veblen's personality by focusing on his 
immigrant parents from Norway whose poverty and "Norskie" ways gave him a 
feeling of inferiority. That feeling, in turn, contributed to Veblen's 
failed life. He had a spectacularly unsuccessful academic career and few 
friends, according to Dorfman, and found revenge with his attacks on the 
world around them. 
 
Drawing on new sources and on sources Dorfman had but did not use, Edgell 
offers a different story. For example, he turns around the issue of 
Veblen's family background, to argue, persuasively, that Veblen benefited 
from it. His parents were affluent farmers who sent all their children to 
college. Even the family's Norwegian background was a positive influence on 
Veblen. Even though he became fluent in English and appreciated Anglo-Saxon 
culture at an early age, Veblen, Edgell tells us, drew upon Scandinavian 
cultural values as a source of strength and an anchor for his ideas. Edgell 
maintains that he especially learned the value of workmanship and 
cooperation from his ethnic background. He also credits the works of Henrik 
Ibsen as having a great deal of influence on Veblen's ideas and his writing 
style. 
 
His multicultural life made Veblen more cosmopolitan than his 
contemporaries. He became fluent in all the major European languages and 
finely attuned to the latest thinking in Europe. Earning a doctorate in 
philosophy at Yale with a dissertation on Kant added to Veblen's broad 
interests. 
 
Edgell draws three important lessons from Veblen's experiences. First, he 
had no difficulties being a successful student due to his cultural 
background; his professors took an interest in him and he got on well with 
them. This pattern continued throughout his academic career. He had many 
friends from among his colleagues and students, and they all stood by him 
with loyalty and devotion. Second, when he began to study economics, Veblen 
became a global thinker whose research knew no disciplinary boundaries. 
Third, neither his ethnic background nor his personality quirks can explain 
his lack of success as an academic. His failure to attain tenure at a major 
university was the result of his unconventional ideas. 
 
Edgell provides a very readable summary of those ideas. Veblen was never 
satisfied with the rationalist approach to economics set forth by the 
neoclassical school that was beginning to dominate economics at the end of 
the nineteenth century. In place of their version of the rational utility 
maximizing human as the prime mover in economics, Veblen applied the 
results then emerging from anthropology and psychology to develop a more 
complex theory of human behavior in economic affairs. More important, to 
Veblen, any science had to be based on a Darwinian approach. Edgell 
establishes that Veblen was a thorough reader of Darwin's books and finds 
parallels in their ideas about society. 
 
As a Darwinian, Veblen was interested in explaining how the economic system 
evolved over time. To him, the capitalist system of his day was neither 
final nor the finest point of economic development. Rather, the economic 
system would continue to develop and there was no reason to believe that 
its development would lead to a better world. Darwin had no idea where 
biological evolution would lead, and Veblen took the same stance with 
economic evolution. This perspective, Edgell points out, placed Veblen at 
odds with the ideas of American economic progress. It was also contrary to 
the neoclassical paradigm with its methodology of equilibrium. 
 
Underlying Veblen's economics was an approach based on the interplay of 
human nature and social institutions. Human nature gave human beings 
clusters of behavior that he labeled instincts. Veblen identified two major 
instincts, workmanship and predation. These instincts, however, were highly 
adaptable. The social institutions under which humans functioned influenced 
which instinct took precedence in human behavior. In a capitalist society, 
these two instincts translated into two types of work, pecuniary and 
industrial. Pecuniary work stressed making money through financial dealing, 
while industrial work required efficient economic production. Pecuniary 
work was predominantly predatory, while industrial work emphasized 
workmanship. The problem was that the predatory group was in charge and 
made decisions based on what was good for their pecuniary gain, not on what 
was good for society. 
 
As long as predatory values dominated capitalism, the chances for a better 
society were slim. Veblen's study of the leisure class, moreover, showed 
how the pecuniary values of the leisure class created a "capitalist 
hegemony," to use Edgell's term, by influencing the values of all other 
members of society. Contrary to Marxist theory, Veblen found that the 
pecuniary values of capitalism were so influential that they led to 
institutional stability. Although he was a socialist, as Edgell describes, 
Veblen could not accept the inevitability of socialism, due to his 
Darwinian perspective. Only changes in technology, the driving force of 
economic evolution, could erode the power and influence of the pecuniary 
elite who were in charge of economic decisions. 
 
Veblen always argued that the persons with industrial values who understood 
the technology of production should be in charge of the economy. Late in 
his life, he wrote a book, _The Engineers and the Price System_, that set 
forth the proposal that engineers had the right industrial values to run 
the economy. Interpreters of Veblen have struggled with whether or not he 
meant what he aid. Edgell reviews their interpretations (including my own) 
very capably. He offers his own view that in this book Veblen became a 
utopian in a very special sense. However fanciful, utopias have a very 
practical purpose of setting a standard of what ought to be for comparison 
with what is. In this case, Veblen used a utopian vision of engineers 
planning the smooth functioning of an industrial machine to point out the 
chaotic nature of an economic system that mixed markets with an unstable 
financial system. 
 
Edgell has helped put Veblen in his rightful place as an enduring thinker 
whose perception that a market system has costs as well as benefits has 
salience for today. Economists who read this book will learn how Veblen 
argued that "conspicuous consumption" created waste in the form of negative 
externalities. They will also find that his ideas contain elements of 
behavioral economics, feminist economics, the new institutional school, and 
the theory of "social capital." Even in the twenty-first century, Veblen 
has things to teach us, and Edgell deserves credit for teaching us more 
about Veblen. 
 
References: 
Joseph Dorfman, 1934. _Thorstein Veblen and His America_ (New York: Viking 
Press). 
Thorstein Veblen, 1953 (1899). _The Theory of the Leisure Class_ (New York: 
Mentor Books). 
Thorstein Veblen, 1944 (1921). _The Engineers and the Price System_ (New 
York: Viking Press). 
 
 
Donald Stabile's most recent books are _Community Associations: The 
Emergence and Acceptance of a Quiet Innovation in Housing_ (Greenwood 
Press, 2000) and _The Origins of American Public Finance: Debates over 
Money, Debt, and Taxes in the Constitutional Era, 1776-1836_ (Greenwood 
Press, 1998). 
 
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