Thornstein Veblen's and US Economic Systems

Thornstein Veblen's and US economic systems
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Thornstein Veblen's and US economic systems
Thornstein Veblen was a renowned economist famous for his contribution in the evolution of American institutionalism economics. He is famous for his contributions in the development of the concept of conspicuous consumption, or excessive consumption as a way of showing the social status. He argued that the dominant class in capitalism have a tendency of pursing a lifestyle of “conspicuous consumption, ostentatious waste and idleness.” According to Ishida (2021), Veblen combined the social and evolutionary thoughts in his approach in handling psychological, social and economic issues. Consequently, his model helps us understand the US economic systems.
The search for an understanding of America’s economic systems connects us to Veblen’s conspicuous consumer decision making and the American pragmatism. According to Almeida (2016), Veblen asserts that the conspicuous consumer has a tendency of emulating the leisure class, who only consume the best goods of a society. Veblen’s approach posits that the society’s predatory life habits and exploitation have evolved and resulted in a stratified society. This society is characterized by a higher social class and a lower class, all defined by their material possessions. Other members of the society regard goods associated with leisure as being honorific and noble. This classification forms the basis of Veblen’s conspicuous consumer. Such products are a source of social satisfaction rather than physical satisfaction.
Veblen’s approach explains how institutions influence the economy by influencing people’s thoughts and consequently their behavior in the society. Many Americans have a tendency of relying on their inner impulses in making purchasing decisions. These inner impu...