Article abstract: Rejecting the classical view of economics as governed by “laws” of supply and demand, Veblen conceived a system in which production and distribution of goods would be controlled by engineers, foreshadowing a “technocracy.”
Thorstein Bunde Veblen was born July 30, 1857, on an eighty-acre farm in Cato Township, Manitowoc County, Wisconsin. His father, Thomas Anderson Veblen, and his mother, Kari Bunde Veblen, immigrated to the United States from Norway in 1847. The sixth of twelve children, Veblen was named for his maternal grandfather, Thorstein Bunde. Eight years later, the family moved to a 290-acre farm in Wheeling Township near Nerstrand, Wisconsin.
When Veblen was seventeen, his father, without consulting him, enrolled him in Carleton College in nearby Northfield. He was graduated in 1880 and taught one year at the Monona Academy in Madison, 1880-1881, after which he enrolled in The Johns Hopkins University in Baltimore. He failed to get the fellowship he had hoped for to enable him to pursue his studies, and he left before the term was ended and enrolled at Yale to study philosophy under President Noah Porter and William Graham Sumner. He received his Ph.D. from Yale in 1884.
Veblen tried desperately to obtain a teaching appointment in the East, and finding none, he returned to Minnesota, married Ellen May Rolfe, and settled on a farm near Stacyville, Iowa. Since his degree in philosophy appeared to be unmarketable, he enrolled at Cornell in 1891 to study economics under J. Laurence Laughlin. The following year, when Laughlin was chosen to head the Economics Department at the new University of Chicago, he took Veblen along as a teaching fellow.
Veblen found advancement at Chicago slow and arduous. He was promoted to instructor after four years of teaching and assistant professor eight years after his first teaching assignment, in 1900. Veblen’s reputation as a teacher was in no way commensurate with his scholarship. In his lectures, he rambled and repeated himself often, and only a handful of perceptive students were willing to complete his courses.
Another problem faced Veblen, causing his dismissal from two universities and the final separation from his wife. Women seemed attracted to him and he often found himself in compromising situations. One such affair brought his dismissal from the University of Chicago in 1904. He went to Stanford University in California at the invitation of President David Starr Jordan. His wife joined him for a time, but soon Veblen became involved with another woman and his wife left him permanently. He was also dismissed from Stanford.
Veblen was unemployed for two years when Herbert J. Davenport arranged for him to come to the University of Missouri in 1911. During his seven-year stay at Missouri, he became disillusioned with the whole process of higher education and left to become the managing editor of The Dial in New York. While in Missouri, he married Anne Fessenden in 1914, a divorcée with two daughters.
Veblen’s ideas began to surface early in his writings and caught the attention of scholars in the schools where he received his appointments. During his brief studies at Cornell in November, 1891, he published “Some Neglected Points in the Theory of Socialism” in the Annals of the American Academy of Political and Social Science, which earned for him a four-hundred-dollar fellowship at Chicago.
Veblen was of the transplanted European stock of agrarian Midwesterners who viewed with suspicion the world of urban finances during the Populist era. He came to believe that the production of the machine age should be for the use of all and not for the profit of a few. He questioned the classical model of Adam Smith and his disciples, which left moral decisions about the distribution of wealth to the impersonal mechanisms of the free market. Veblen was particularly distressed over what he viewed as the sabotage of the production system by entrepreneurs who created artificial shortages, controlled prices, and limited new entries into business in order to maximize their own gains.
Veblen was not content merely to identify the problem of the capitalistic system but wished to get to its historical source. He took a multidisciplinary approach by applying the principles of psychology and anthropology to economics. He saw modern capitalism as an anthropological problem rooted in man’s barbaric past. Through study of archaeology and history, he developed a four-stage plan of the evolution of the human community in Western civilization: first, the peaceful savage economy of the Neolithic period, second, the predatory barbarian economy with its creation of the institutions of private property, war, masculine dominance, and the leisure class, third, the handicraft economy of the premodern period, and finally, the machine age of potentially unlimited production.
(The entire section is 2055 words.)