David Reisman, The Social Economics of Thorstein Veblen

David Reisman, The Social Economics of Thorstein Veblen, Edward Elgar, 2012, vii + 338 pp, hbk, 0 85793 218 1, £90

The dust jacket suggests that Thorstein Veblen’s writings are ‘difficult to read and understand’. Perhaps they are, but most of the many passages quoted in Reisman’s book are not. ‘The institutional structure of society subsists and we live within its lines … with more acquiescence than dissent’ (quoted on p.7). ‘The propensity for achievement – the instinct of workmanship – tends more and more to shape itself into a straining to excel others in pecuniary achievement’ (quoted on p.54). Advertising shifts ‘given articles of consumption from the footing of superfluities to that of necessary articles of livelihood, necessities by conviction of morals and decency rather than by requirement of subsistence or physical comfort’ (quoted on p.150).

As Reisman shows, it was the waste at the heart of capitalism that bothered Veblen rather than any exploitation of the workers; and whilst we might now question Veblen’s enthusiasm for the Russian revolution – an enthusiasm understandable from within his own context – we shall understand perfectly his perception that aggressive nationalism can trump economic rationality.

Reisman has constructed a coherent structure out of Veblen’s thought. Whether that structure is Veblen’s or Reisman’s must remain an  open question, because Veblen’s thought, as represented in Reisman’s book, could equally well be understood as a somewhat rambling exploration of the fascinating complexity of the institutions of the world of his time. But what is clear is that Veblen – correctly, in the view of this reviewer – thought the life of human society to be best understood as a changing network of changing institutions. Reisman shows that Veblen saw himself as a somewhat Darwinian social scientist, attempting to understand the causes of things, and that for him the social caused the economic rather than the other way round. Human interaction therefore ‘belongs in the field of the sociologist’ (quoted on p.2), and economics belongs in that context, not vice-versa.

This is all rather salutary. It suggests that however much we might reason the economic feasibility and desirability of such social policies as an extension of universal benefits to new demographic groups, if this is not the direction in which society is evolving then we might be wasting our time. On the other hand …

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