Review of Veblen’s "The Place of Science in Modern Civilization and Other 
Essays", by. W. H[ale] Hamilton

The American Economic Review, Vol. XI, No. 2, June 1921, pp. 268-271
(New Haven, Conn., American Economic Association, 1921).

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[268]
The Place of Science in Modern Civilization and Other Essays. By Thorstein 
Veblen. (New York: B. W. Huebsch. 1919. Pp. 509. $3.00.)

From twelve to twenty-eight years have elapsed since the initial appearance in 
various learned periodicals of the essays by Mr. Veblen which are now assembled 
in The Place of Science in Modem Civilization. In the interval they have been 
thumbed over by graduate students, used for dialectic by professed economists, 
escaped the attention of the lay Veblen cult, and left their mark upon the 
development of the "science." An appraisal of the volume should, therefore, be 
something else than an impressionistic opinion by the reviewer about a book hot 
from the press. It should be a re-review of reviews, free from the taint of 
"opinion," and limited to a record of the "facts." But, even at this late date, 
so objective and colorless an appreciation of Mr. Veblen's contributions is 
impossible. The time was when they were far beyond the outer fringe of economic 
speculation. The time is when they are intimately associated with many daring 
quests which have overridden the older restraints upon theory. And intimacy is 
as great a bar to correct judgment as remoteness.

The essays which make up this volume, despite the range in time and place that 
marked their original publication, fall into an easy sequence. The first of 
three groups into which they fall is concerned with the meaning and the 
development of "the scientific point of view" and its place in modern culture. 
The last is given to a discussion of the "blonde race" and the incidence of its 
ethnic endowment upon "Aryan" culture. Between the two, running from page 56 to 
page 456, and comprising four fifths of this book, are a group of studies upon 
the nature, scope, limitations, and implications of economic theory. Since the 
first of these inquires into whether economics is an evolutionary science, the 
essays which give the volume its title may be regarded as a formal introduction 
to the discussion of economic theory. And since, back of both "science" and 
"economics," Mr. Veblen looks for "cultural antecedents," the study of the 
nature of the civilization of the "dolicho blonde" is not out of place. Thus, 
despite variety in subject-matter, the volume has unity. Its importance, 
however, lies in the ventures into economic criticism which make up its bulk and 
escape mention in its title.

If Mr. Veblen's vehicle had been a formal treatise his strictures upon accepted 
economic theory would have formed a single articulate study. The series of 
separate essays which he has used instead has the [269] advantage of enabling 
him to get at his subject from many different angles. It also imparts a 
suggestiveness which a more formal discussion would have lacked. It allows a 
searching analysis of the preconceptions of classical theory in general; a 
specific appraisal of the theory of marginal utility; a lucid discussion of the 
nature of capital and of forms of employment; and a penetrating examination of 
the systems of economics which bear the names of J. B. Clark, Gustav Schmoller, 
and Karl Marx. The burden of this criticism is to show that reputable theory 
moves "in terms alien to the evolutionist's habit of thought"; that it assumes a 
"hedonistic conception of man" as "a lightning calculator of pleasures and 
pains, who oscillates like a homogeneous globule of desire of happiness under 
the influence of stimuli that shift him about the area, but leave him inert"; 
and that it takes for granted "a benign order of nature" and "a meliorative 
trend in the course of events." It discloses the small province of value theory 
which utility and productivity theorists have so meticulously cultivated; shows 
that Austrian and Clarkian economics are variants of the same general doctrine; 
and reveals both as refinements and sublimations of a system of thought which is 
essentially Ricardian. It refuses to find in the implications of a system of 
value proof that each gets "what he produces" and that the prevailing economic 
order is natural and moral.

The great merit of such a critique lies in its constructive value. The argument, 
in spite of its multiform appearance, has coherence, pertinency, and purpose; 
and all because Mr. Veblen has his theory about what economic theory should be 
about. He insists that the complex of activities which make up our industrial 
life forms a continuous process; that the economic order is peopled with real 
human beings, who have their varied characteristics and such differences one 
from another that the question of personal selection for economic place is an 
important one; that men are born into communities, with their set ways of doing 
things, and that they are moulded by these arrangements; that economics might 
well concern itself with discovering the nature of such of these arrangements as 
are pertinent to the problem of wealth; and that the goodness or badness, 
efficiency or inefficiency, of these schemes of life, instead of being taken for 
granted, are to be tested by definite standards and in the light of determined 
facts.

The nature of these suggestions can best be shown by an illustration which the 
reviewer will present in non-Veblenian terms. In one of the essays a careful 
distinction is made between industry and business. It is through industry that 
goods and services are fashioned and furnished; it is through business, at least 
at present, that the many and varied tasks of industry are organized. Industry 
is permanent and [270] indispensable. It exists upon the oasis, the manor, the 
frontier, the urban center. It will exist under any scheme of economic 
organization. If every act of production, of exchange, and of consumption were 
in response to the orders of an industrial autocrat, there would still be 
industry. Business, on the contrary, is only one of several schemes for the 
integration of industrial tasks into a system. It has almost no place on the 
manor and the frontier. It would not exist in a system organized by an 
autocratic despot. Even today its domain is not complete; it exerts little 
influence over the activities of the housewife and the conduct of the affairs of 
the family. It consists of a scheme of institutions which include the pecuniary 
calculus, the system of prices, the right to buy and sell, and the market. Most 
problems of the day involve the question of the success of business in 
organizing the industrial system. Most remedial measures include, in mild or 
drastic form, restrictions upon or substitutes for the various devices which 
make up the business control of industry. The distinction is essential to a 
correct formulation of the problem of an appraisal of the prevailing scheme of 
economic arrangements.

To these critical-constructive studies a significant place must be given. The 
literature of economics has always been rich in the type of criticism that 
projects doctrines upon the same intellectual plane, analyzes them minutely, and 
by comparative devices tries to reduce the whole truth to detailed formulation. 
It has been poor indeed in criticism that associates the general characteristics 
of bodies of doctrine with the specific problems which led to their formulation 
and with the systems of thought which they embody. Mr. Veblen did not bring the 
latter type of criticism into economics. But with its aid he has given the whole 
body of classical economic theory a meaning which it did not before possess and 
has clearly revealed its limitations. Moreover, he is preeminent in its use. It 
is significant that, though many have followed him, none of the later critics 
have discovered important leads which are not at least suggested in these 
essays. Some are sure that this critical work has demolished the older 
formulations and prepared the way for a "scientific" economics. Others insist 
that it has merely opened a new domain to economic theory by showing the 
"limitations" of the older doctrines. Still others maintain that its only effect 
has been to strip from the older theory implications of statement that were no 
essential part of it. It would be futile to set down the right answer to his 
question of constructive influence without making an exhaustive survey of Mr. 
Veblen's doctrines. And that cannot be attempted here. It seems certain, 
however, that even in this volume Mr. Veblen has done constructive work of great 
importance by pointing the [271] way to an examination and appraisal of the 
specific institutions which make up the prevailing economic order.

The difficulty of a current appraisal of Mr. Veblen's economics remains. But the 
nature of the difficulty has radically changed. The danger of ignoring him 
because he is far in advance of the scrimmage line is gone. The present danger 
is that his work will be appraised in terms that are indefinite and cosmic. 
There is already a tendency to make him responsible for all that is new in 
economics; and in history and politics and psychology as well. This danger was 
recently voiced by a distinguished English economist who gave an account of a 
meeting with Mr. Veblen in terms of a pilgrimage to a great American 
intellectual deity. And the movement has reached the laity. In this season's 
most "significant" novel the heroine who fights the smugness of the small town 
with affectation reads Veblen. This situation has been abetted by The Leisure 
Class, Imperial Germany, and The Nature of Peace, which have been read by the 
laity. Their glib phrases have convinced many of their readers that they have 
understood Veblen. For that reason The Place of Science in Modern Civilization 
is most welcome. It presupposes a specific acquaintance with economic theory. It 
is addressed to the professional economist. And it enables the cosmic judgments 
of Veblen's place in economics to be reduced to finite terms.

Walton H. Hamilton.
Amherst College.
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