Veblen (Extra Credit)

Thorstein Veblen Flashcards

🟦 1. Summary of Veblen’s Ideas

Influences:

• Evolutionary theory

• Marxian theory

• Economics

Key Concepts:

• Instinct of workmanship

• Parental bent

• Idle curiosity

• Emulation

Cultural Lag:

• Social and legal changes tend to lag behind technological advancements.

Business vs. Industry Conflict:

• Industry is capable of high productivity → would benefit society.

• Business sabotages industry to keep prices and profits high.

• Engineers (not business leaders) should run industry for greater efficiency.

Conspicuous Consumption & Leisure:

• Consumption and leisure as social signals of status.

Political Implications:

• Business seeks to control the state → undermines free trade.

• Nationalism as an extension of business interests.

🟦 2. Instinct of Workmanship

Definition:
Natural human tendency to engage in productive and creative work.

Example:
An artisan taking pride in crafting a handmade piece of furniture.

🟦 3. Parental Bent

Definition:
The human tendency to care for and nurture others.

Example:
Parents investing in their children’s education and future.

🟦 4. Idle Curiosity

Definition:
Natural human tendency to seek knowledge for its own sake.

Example:
A scientist conducting research out of pure intellectual interest.

🟦 5. Emulation

Definition:
The drive to imitate others, particularly those of higher social status.

Example:
Buying designer clothes to match the appearance of celebrities.

🟦 6. Industrial Arts

Definition:
The body of technical and mechanical knowledge shared by a society.

Example:
The development of renewable energy technology in modern society.

Role:

• Drives technological advancement

• Society benefits when industry functions effectively

🟦 7. Cultural Lag

Definition:
The tendency for social, legal, and cultural changes to lag behind technological progress.

Example:
Social norms and laws struggling to keep up with rapid advancements in AI.

🟦 8. Business vs. Industry Conflict

Industry:

• Capable of high productivity → would benefit society.

Business:

• Sabotages industry to keep prices and profits high.

• Focuses on salesmanship rather than production.

Solution:

• Industry should be run by engineers, not business leaders.

🟦 9. Free Income and Capitalization

Free Income:

• Business earns income without contributing to production.

Capitalization:

• Free income gets attributed to intangible assets (e.g., "good will").

• These become liabilities → businesses maintain profits by sabotaging industry.

Example:

• High prices for pharmaceutical drugs despite low production costs.

🟦 10. Conspicuous Leisure

Definition:
Demonstrating wealth and social status through non-productive leisure activities.

Example:

• Attending exclusive galas and yacht parties.

🟦 11. Conspicuous Consumption

Definition:
Demonstrating wealth and social status through the purchase of luxury goods.

Example:

• Buying expensive cars, jewelry, and designer clothes.

🟦 12. Business Sabotage

Definition:
Intentional limitation of production to maintain high prices and profits.

Example:

• Limiting oil production to keep gas prices high.

🟦 13. Engineers as Solution

Problem:

• Business leaders motivated by profit → sabotage industry.

Solution:

• Engineers, motivated by production efficiency, should run industry.

Example:

• Renewable energy engineers increasing energy production despite market resistance.

🟦 14. Politics and Business Conflict

Business Influence on Politics:

• Business seeks to control the state → protects profits through tariffs and trade policies.

Impact:

• Harms international industry and global economic growth.

Example:

• Protectionist tariffs increasing the cost of imported goods.

🟦 15. Nationalism and Business Interests

Definition:
Nations pursue self-aggrandizement → reflects business interests.

Example:

• Military expansion to protect business interests abroad.