THORSTEIN VEBLEN

Thorstein Bunde Veblen was born in Manitowoc County, Wisconsin, on July 30, 1857, and
died on August 3, 1929, near Menlo Park, California. He is an American economist and
social scientist who sought to apply an evolutionary, dynamic approach to the study of
economic institutions.
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LIFE BACKGROUND
Thorstein Veblen was an outcast in American economics in the late nineteenth and early
twentieth centuries. He grew up in a farming community of Norwegian immigrants in
Wisconsin and only spoke Norwegian at home and did not learn English until he was in his
teens. He studied economics under the neoclassical economist John Bates Clark but
rejected his ideas.
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Veblen is best known for his book The Theory of the Leisure Class, published on 1899
which popularized the term "conspicuous consumption" (consuming to make a statement
to others about one's class or accomplishments). This is the term for which Veblen is most
famous for. Veblen was intrigued by the relationship of the economy, society, and culture.
He studied the social order and concluded that people made purchases to demonstrate
their economic status and achievements to others. He wanted to integrate economics,
sociology, and history to show how human biology and psychology influenced the
discipline.
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Veblen contends in this work, influenced by the work of Charles Darwin, Karl Marx, and
Adam Smith, that the evolutionary development of human society is the foundation for our
modern economic institutions, such as the divisions between the wealthy ruling class, the
hardworking middle class, and the working poor. It addresses a wide range of economic
and human behavior issues, with a focus on the concept of a societal shift from production
to consumption economics. The idea is that society's leaders demonstrate their power and
status by wasting money rather than leading or creating.
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Veblen good is the result of Veblen’s analysis. It is a product whose demand rises as its
price rises because consumers regard it as an exclusive status symbol—in other words, a
product consumed conspicuously and if the price of such product decrease, yung pagka
exclusive niya ay mababawasan para sa mga consumer na status-conscious and at the same
time masyado pa rin siyang expensive for the mass market, which will result to decline for
the overall demand. Veblen goods is high-end designer goods with a distinct brand identity.
These items are so expensive that only the very wealthy can afford them. Ayun nga like
what I’ve said, the higher the price of the goods, the less likely it is that other consumers
will be able to afford them and will begin to perceive them as a way of signaling great
wealth and success. These goods are not available in regular stores and are in high demand.
So it is safe to assume na Veblen goods are priced higher than a basic product in the same
category. Consumers value them more because of their higher prices. Veblen goods include
Rolex watches and the most recent iPhone model (and other products that are marketed as
exclusive or projects success, it is far more likely that it will be sold in upscale boutiques
rather than common department stores. A Veblen good is, in essence, a luxury item that the
majority of the population will not or cannot afford.)
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Veblen was a harsh critic of the upper class, coining the phrases "conspicuous
consumption" and "conspicuous leisure". The difference between conspicuous
consumption and conspicuous leisure is that conspicuous consumption focuses on
purchasing goods and services to demonstrate wealth. Example of this are designer clothes,
expensive jewelry, and luxury cars while conspicuous leisure focuses on behaviors and
activities that display wealth. Example, taking long vacations in exotic places, keeping
fancy-bred animals, playing an expensive sport, or using a plane as an express service to
deliver milk daily. He used these phrases to define the often unnecessary and inefficient
use of resources and time that is common of society's wealthiest members.
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To conclude my presentation, Thorstein Veblen is an American economist and social
scientist who sought to apply Darwin’s evolutionism to the study of modern economic life.
In 1899, he published The Theory of the Leisure Class, his most famous work. It is still
widely read today and captures the essence of much of his thinking. He wrote that the
industrial system required men to be diligent, efficient, and cooperative, whereas those
who reigned the corporate world were concerned with making a profit and showing their
fortune. Veblen believes that the social values of the rich, which have their evolutionary
basis in the primitive behavior of humans during ancient times, have made a huge
contribution to an unnecessary division of class, along with a lack of appropriate use of
wealth in society. "The Theory of the Leisure Class" remains a thought-provoking and
significant economic and sociological study that is as relevant today as it was when it was
first written.
That is all from me, thank you.