Veblen Instinct of Workmanship, Chapter 5 Ownership and the Competitive system pg. 187-194

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 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 centers on the quest for profits” (Veblen, 1914, pg. 190). Veblen also says that both businesses  may gain in a transaction, that it is not a zero sum game but one may gain more than another due to better bargaining skills. Ultimately he writes that, “the discipline of business occupation should accordingly run to the habitual rating of men, things and affairs in terms of emulative human nature and of precautionary wisdom in respect of pecuniary expediency” (Veblen, 1914, pg. 191).


Veblen goes on to state that in an earlier phase, there is perhaps no major difference between business class and working class. This disparity widens over time as workers become more specialized.  Veblen acknowledges that at first glance it would appear that the business attitude would impede technological advance and development in favor of manipulation and pecuniary gain. However, Veblen writes that in fact we see major technological advances, in fact, the greatest seen since humanity has existed.  Veblen states that we must understand how this has happened. For our next post, we will explore these issues…

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