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Veblen's work is especially noteworthy when he analyzes and dissects the habits of thought and modes of conduct that underlie competitive relations between social actors. He advanced a sophisticated theory of the social sources of competitiveness in human affairs. Self-esteem, he argued, is only a reflection of the esteem accorded by one's fellows. Consequently, when such esteem is not forthcoming because a person has failed to excel in prized competitive endeavors, he suffers from a loss of self-esteem. The drive for ever-renewed exertion in a competitive culture is therefore rooted in the fear of loss of self-esteem.
Those members of the community who fall short of [a] somewhat indefinite, normal degree of prowess or of property suffer in the esteem of their fellowmen; and consequently they also suffer in their own esteem since the usual basis of self-respect is the respect accorded by one's neighbors. Only individuals with an aberrant temperament can in the long run retain their self-esteem in the face of the disesteem of their fellows. ... So soon as the possession of property becomes the basis of popular esteem, it becomes also a requisite to that complacency which we call self-respect.
In a competitive culture, where men judge their worth in comparison with that of their fellows they are bound to a perpetually revolving Ixion's wheel because they constantly aspire to outdo their neighbors.
As fast as a person makes new acquisitions, and becomes accustomed to the new standard of wealth, the new standard forthwith ceases to afford appreciably greater satisfaction than the earlier standard did. ... the end sought by accumulation is to rank high in comparison with the rest of the community in point of pecuniary strength. So long as the comparison is distinctly unfavorable to himself, the normal, average individual will live in chronic dissatisfaction with his present lot; and when he has reached what may be called the normal pecuniary standard of the community, or of his class in the community, this chronic dissatisfaction will give place to a restless straining to place a wider and ever widening pecuniary interval between himself and the average standard.
Veblen is at his best when he analyzes the various means by which men attempt to symbolize their high standing in the continuous struggle for competitive advantage. Conspicuous consumption, conspicuous leisure, conspicuous display of symbols of high standing are to Veblen some of the means by which men attempt to excel their neighbors and so attain heightened self-evaluation "High-bred manners and ways of living are items of conformity to the norm of conspicuous leisure and conspicuous consumption. ... Conspicuous consumption of valuable goods is a means of reputability to the gentlemen of leisure" "With the inheritance of gentility goes the inheritance of obligatory leisure." Conspicuous consumption or conspicuous leisure need not necessarily be engaged in directly by those in search of heightened competitive standing. Rather, such characteristic life-styles may be displayed by persons who are dependent on the head of a household - his wife and servants, for example - to enhance the status of the master. In the modern world, the head of the middle-class household has been forced by economic circumstances to gain a livelihood in an occupation, "but the middle-class wife still carries on the business of vicarious leisure, for the good name of the household and its master." The liveried servant displays his multi-colored coat of servitude not to improve his own image but rather to symbolize that of his master.
In the aristocratic age, "the age of barbarism," such characteristically "wasteful" styles of competitive display were limited to the leisure class, the top of the social pyramid. Now, Veblen contended, they tend to permeate the whole social structure. Each class copies the life-styles of its superordinates to the extent of its ability. "The result is that the members of each stratum accept as their ideal of decency the scheme of life invoked in the next higher stratum, and bend their energies to live up to that ideal." "The canon of reputability" must adapt itself to the economic circumstances and the traditions of each particular class, but it permeates all society to greater or less degrees. Though originating among the leisure class, it characterizes the total culture and shapes its characteristic life-style. This is why even the poor, though they are physically better off in modern society than their forebears were in their time, suffer more. "The existing system has not made ... the industrious poor poorer as measured absolutely but it does tend to make them relatively poorer, in their own eyes ... and ... that is what seems to count." Clearly, Veblen, like others before and after him, had in effect come upon the idea of "relative deprivation."
In Veblen's opinion the simplistic notions of human motivation on which classical economics rest cannot serve to explain the springs of action of man in modern pecuniary civilization. It is not the propensity to save or to truck and barter that animates man in the modern world, but the propensity to excel his neighbor. The struggle for competitive standing becomes a basic datum if one is to understand the institutional framework of modern economic behavior.
Coser, 1977: pp. 268-269.