Institutional Law and Economics: The Legal-Economic Nexus

  We  move to chapter 5 and “Ownership and the Competitive system”. Here Veblen tells us he is going to investigate the impact of the switch to the pecuniary system and its impact of workmanship and serviceability to the community. He starts by contrasting the two main classes in the pecuniary culture of the laborers and the owners. Moving from the period of free labor to ownership of capital, the laborer no longer cares about his own efficiency according to Veblen. The worker must work to earn a wage due to ownership of capital. The owners of capital are focused on pecuniary gain and the manipulation of property. As we switch from a period of free labor to owned capital, they derive gains from the business like management of this property without care or concern for other factors. They are also very focused on the field of bargaining, as Veblen writes, “it is by bargaining that their discretionary control of property takes effect and in one way or another their attention cent...

 Veblen here is continuing to help us understand how he views the shaping of human use of technology and workmanship.  A statement perhaps that best summarizes his views is, "therefore on the facts made use of in the industrial arts....and the immediate question is as to the bias or drift of the pecuniary culture as it affects the apprehension of facts serviceable for technological ends". Veblen's view is that facts are not just lying around to be picked up but are shaped by the culture and habit of thought that exist in the community at any given time. I am curious to see if Veblen ever addresses mutations or when people decide to go against the habits of thought in their community? This seems to be such an important to how change occurs and is important to so many human stories we tell. Veblen takes another stab at religion writing that, God throws a deeper shadow of ignobility over the material side of life, and makes any workmanlike preoccupation with industrial effic...

  Veblen starts by noting that in his mind the pastoral regimes have no real interest for today's civilization based on matter-of-fact knowledge.  The current society has been greatly impacted by the predatory regimes of the past such as the Roman empire.  He also writes that defenders of the predatory regime are not based on its own internal merits but rather because it is necessary to protect us from external forces. There are two parts or phases to the predatory regime.  The first is that of “lower barbarism” where war and conflict are common.  The second phase is the peaceable phase where regimes are armed but not fighting.  This is a highly “self-regarding” phase focused on ownership and property rights.  And key for Veblen, workmanship is based on factors of “personal, invidious, differential and emulative nature”. In essence, workmanship is warped to external and damaging factors and not based on “other regarding” factors as they wer ein “savage...