Thorstein Veblen and Human Emotions: An Unfulfilled Prescience
Wolozin, Harold, Journal of Economic Issues
By centering on instinct as a prime mover in economic behavior, Thorstein Veblen tapped into the function of the mind itself-in particular, the commanding role of the unconscious in human motivation and behavior. In this paper, I expose his seminal focus on instinct to the powerful beam of light of psychoanalytic theory. The results of this analysis point to (1) a new perspective on Veblen's insights into the relationship between economic institutions and human emotions and (2) the contribution psychoanalytic theory can make to the analysis of economic behavior--in particular, the roles of restlessness, phantasy, and the irrational.
Veblen on Instinct, Institutions, and Human Emotion
In his wide-ranging works Veblen singled out instinct, in particular the instinct of workmanship, as the prime mover of economic behavior. He described man as "a coherent structure of propensities and habits, which seeks realization and expression in an unfolding activity" (1898). These included a number of basic instincts including workmanship, parental bent, idle curiosity, and so on. He described these instincts as "products of his (man's) heredity traits and his past experience" (my italics). To Veblen, instinct was the pilot and motor of human action. He held "he is not simply a bundle of desires that are to be saturated.... It is the characteristic of man to do something, not simply to suffer pleasures and pain" (390).
Yet Veblen, in his depiction of the roots of instinctual behavior, had created a dilemma. On one hand, in describing instincts as timeless propensities he was in essence saying that they were deep emotions, self-directed roads to "satisfaction." On the other hand, tying instincts to "past experience" suggested that the resulting instinctive behavior was the product of institutions, handmaidens of past experience (1898, 386, 390). This point-counterpoint of internal propensities and emotions and external influences (institutions) dominated his economic analysis. It also presented him with an unresolved dilemma, namely, the relationship in human behavior between the raw, timeless emotion of instinct and institutions. As I shall explain, the path he took in coping with this dilemma established a template for subsequent developments in institutional theory, leading many institutionalists to conclude that "it's all culture," a position which Veblen himself did not unequivocally hold.
The evolution of Veblen's thinking on this issue is not, however, clear cut. Although Veblen singled out the prime, teleological role of "hereditary" instincts (the instinct of workmanship, the parental bent, idle curiosity, sentiments) (1931), he was less than consistent in his work in depicting their influence. In his pioneering 1899 work, The Theory of the Leisure Class, he forcefully depicted man as "a centre of unfolding impulsive activity--teleological activity" (15-16). He drew a sharp line between "the human endowment of instincts" and the "habitual elements of human life." Instincts are "transmitted intact from the beginning of humanity," while the "habitual elements ... change unremittingly and cumulatively, resulting in a continued proliferous growth of institutions." As to instincts, "no heritable modification ... is to be looked for" (306). However, in a later work, The Instinct of Workmanship and the State of the Industrial Arts (1914), he described the instinct of workmanship as "concerned with the ways and means of life rather than with one given ulterior end" (318). In The Place of Science in Modern Civilization (1961), he had modified his position that instincts are prime movers to conclude that institutions were on a par with if not superceding instincts in determining human conduct. It "takes place under institutional norms and only under stimuli that have an institutional bearing" (242). Thus, Veblen had backed down from his initial, strong depiction of instincts as prime movers. Institutions were now either on a par or even replacing instincts as prime movers of human and economic behavior. …