Institutional Law and Economics: The Legal-Economic Nexus

  Veblen begins the next section by stating three prepositions: 1) it is difficult to say when and how institutions will change in these earlier phases of industrial organization and 2) this early phase of workmanship can be contrasted with a later phase primarily dominated by private property and 3) the two phases may overlap to a large extent. The next couple of paragraphs lay the groundwork for what Veblen views as the material limitations imposed on these earlier cultures in the development of technology via their instinct of workmanship. Each culture has the inherent ability to further develop their technology and mastery of material conditions but become constrained by the natural environment that they face and in some cases by the older institutions they inherit from elders. Veblen believes we can make several general statements about transitions between what he calls “the savage state of affairs” to a “barbarian culture” which entails pecuniary control of industry and work cond

  Chapter 4 is entitled “The Technology of the Predatory Culture”.  It starts with a strong statement that the way of life is very much based on the group's holding of a stock of knowledge and no individual can truly do their work or create without access to a pool of knowledge.  This is a reversal from some of our traditional notions that individuals create knowledge and that knowledge is then shared with the group through usage and implementation.  This idea is present through much of Veblen's writing. Veblen does recognize that some individuals are more creative or hard working or more inherently skilled but that they are still a product of the group. The next few paragraphs Veblen focuses on the differences they exist across individuals due to chance of heredity and other random factors. He also makes the point that people will often deny the role of the group in their achievements and success. He writes that, “to evade or deny something of the breadth of their inheritance

  Veblen ends this chapter 3 with a discussion of the borrowing of technology across cultures. He also notes that a degree of religious or magical thinking is often associated with many prehistoric cultures. Here again he notes the problem that this causes with the mechanical arts although less so with the agricultural and animal arts. He then speculated that certain cultures borrowing from others may not carry over the religious or spiritual or magical elements.  Thus unencumbered borrowing in Veblen's mind would lead to more improvements in mechanical arts as they are tied into the problems of spiritual elements and more focused on matter of fact application.  It is hard not to see in this book so far that Veblen was very much arguing that 1) technological improvement was a key to human development and growth, 2) technological development was inhibited by imbecile institutions such as religious or spiritual practices versus matter of fact viewpoints, 3) spiritual or magical pract

 In this post, we are looking at about 20 pages to catch up from the week missed. Veblen starts with the claim the the rate and nature of the technology of any community is a function of the material environment and the nature of the people in that community. He at first seems to claim that different communities will have different capacities for technological change but then wavers and seems to say that the character of people to seek and make technological change is a function of the material environment as well.  He then makes a further claim that communities which are made up of “hybrid” racial groups will be better able to achieve technological change and growth.  These are clearly empirical claims that could in theory be tested. Starting on page 117, Veblen starts with a claim that all of the European communities started at a low level of savagery in terms of their institutional and technological environment and character. These communities in this state of “savagery” were relati