Institutional Law and Economics: The Legal-Economic Nexus

  In chapter 3 entitled "The Savage State of the Industrial Arts", Veblen starts with his well known notion of the community stock of technological knowledge or as he often refers to it immaterial equipment. Well before Paul Romer and his Nobel prize, Veblen understood that economic growth and change was driven by changes in tools and know-how of humanity. Veblen's approach acknowledges that individuals come up with changes in tools use and ideas but that these individuals are immersed in a social and community setting.  This is the key connection that Veblen makes.  Individuals do have agency and do act but at the same time are immersed in a deep social network or setting that drives to some extent what we think about and our decision making processes.   There are a few underlying points or details that Veblen is at pains to make in this overall discussion.He points to the fact that at times certain specialists will be brought to bear.  And yet, he still argues...

  Veblen on page 89 reintroduces the idea of parental bent. Again, this is the instinct that drives people to consider the welfare of others not just their own children and the welfare of the community into the future.  He also remarks that this instinct was stronger before the advent of a pecuniary society and private property ownership. Veblen also references that this instinct drives a desire to minimize wasted effort. However, in a reference back to his book the Theory of the Leisure Class , notes that “conspicuous waste” is a countervailing instinct that may intervene as societies develop over time. Finally, Veblen again refers to the fact that parental bent and compassion may be useful in advancing the usefulness of biological and agricultural human ventures but not in the mechanical arts. From here, Veblen spends a considerable amount of time extolling the virtues of women in  terms of the parental bent and their for animals and crops.  He seems to refer in fa...

  Veblen starts this next section with a logical question: How is that some contamination can occur in workmanship that actually perverts its own ends? He suggests that workmanship itself is part of the problem as its method of cause and effect may at times in error connect certain causes which are not in effect real causes.  The second issue that occurs whereby Veblen introduces a new instinct which he calls idle curiosity.  He defines this as, “which men, more or less insistently, want to know things, when graver interests do not engross their attention”. (Veblen, pg. 85, 1904).  It is really the essence of a creative instinct in many ways. How does play into the problems of the contamination of instincts? Veblen first starts with the point that this is a very influential instinct but may be in the background in many cases where more urgent issues arise. He also points to the fact that it is likely that only certain individuals in a community have an overabundance ...

  In this section, Veblen states by talking about the impact of portraying mechanical and biological material as having human purpose in the form of anthropomorphism. He writes that this type of activity can have harmful or degrading impact in terms of humans working with mechanical type materials.  He is less negative about the impact on biological life.  In fact, he essentially argues that there may even be some beneficial impacts from a certain type of anthropomorphism when working with plants and animals. As a point of reference, I can see how Clarence Ayres would interpret Veblen as saying there is a strict dichotomy between technology and ceremony.  While Veblen's words do allow for some degree of nuance, it must be remarked that he is generally of mind that humans make more progress,especially in the mechanical arts, when anthropomorphism and other ceremonial or even religious ways of thinking or habits of mind are reduced or eliminated. That said, it is also ...

 In this first section of our reading today, Veblen acknowledges that the impact of ceremony on tool using will vary by the type of activity being undertaken.    This first set of paragraphs immediately points to relative degree of ceremony versus industry comparison if we want to sue that terminology.   this is opposed to the typical depiction which seems to be that ceremony and industry are simply opposed parts of a binary dichotomy. Veblen also notes how slow the development of human using tools seems to be in general. The next section points to the issue of the "state of the industrial arts", a term Veblen will constantly use throughout his writings to indicate the state of tools and technology in a human society.  The rest of this section highlights differences between various cultures in terms of their development and uptake of tools and technology.  He discusses the native culture of the northern Arctic and how they were able to develop appropri...

  Veblen is taking us on a tour of the clashing interests of two camps of instincts and then institutions.  On the one side, the instinct of workmanship and the parental bent are bent towards ensuring that human life is undertaken with an eye towards accomplishing goals in an efficient manner and with the future in mind. The other side consists of the coercive and predatory nature of humanity which is reflected in “disserviceable” institutions. As he writes, “human culture in all ages presents to many imbecile usages and principles of conduct to let anyone overlook the fact that disserviceable institutions arise easily” (pg. 48, 1913). The next few pages Veblen discusses how various other instincts begin to contaminate the instinct of workmanship. He points to various “taboos, consanguinities and magical efficacies” (terms of various cultural and religious practices) come to be involved in the instinct of workmanship and in essence move the individual and the system away from ...

  In the last section of the introduction, we see Veblen's ongoing focus on a lag between human endowment of instincts which change slowly if at all and the changes in technology and the material means and ways of life.In particular he focuses on how the human race had to develop a sense of efficiency and workmanship to survive in earlier times and this is now in conflict with how society is organized today. From there we move into chapter 2, which is entitled “Contamination of Instincts in Primitive Technology”. First, Veblen makes his distinction between tropismatic or automatic behaviors that are not subject to habit and other instincts, such as workmanship that are subject to be attuned by habit of thought. From here, we get to the starting point on contamination.  Veblen states that human knowledge is cumulative and builds on itself through learning and education. He states that there is “matter-of-fact” knowledge and then there is knowledge based on “convention, inferenc...