A Comparison Of Veblen and Marx

A Comparison of Veblen and Marx

Since Veblen was one of the first, or at least one of the major opponents of capitalism after 1870, we will now take a look at some of the similarities and differences between Veblen's and Marx's economic thought. In similarity to Marx, Veblen took a historical approach to his analysis and was likewise influenced by Darwin's notions of evolution (Veblen, "Limitations," 1961). He believed, just like Marx, that a few parasitic owners exploited labor or direct producers and that worker conditions were deplorable (Veblen, "Ownership," 1964). Veblen also recognized the adverse effects of competition and how it had the tendency to increase industrial concentration. For Veblen, crises and depression were inherent to capitalism, and government served the role of enforcing and guaranteeing a profit for the privileged capitalist or pecuniary class. Also in support of Marx, Veblen believed that ownership of the means of production should be socialized and not privately held.

In contrast to Marx, Veblen did not use equilibrium analysis because of his strong belief in the historical and evolutionary nature of capitalism. Because of this, Marx's crisis theory was considered to be more comprehensive. Veblen's crisis theory was simply founded in his notions of "emulative consumption." Furthermore, unlike Marx, Veblen had no concrete theory for a wage rate or a profit rate because he rejected both the utility theory of value and the labor theory of value. Interestingly, Marx felt that the time for the overthrow of capitalism was soon and hence took an active role in encouraging workers to unite and revolt. Veblen, on the other hand, took a more pessimistic view of the elimination of capitalism by recognizing several counter effects or social and cultural norms or conditioners. Some of these counter effects included patriotism and emulative consumerism both of which had the tendency to cause workers to readily accept defeat. From this, Veblen could explain why workers did not persistently fight against exploitations and alienation and why they chose to continue to support existing laws and the government that was supposedly formed for protecting the pecuniary class's status quo.