Markets, Productivity, and Happiness in a Historical Perspective

Wealth and how to use it: economists and the affluent society in the decades after the Second World War

Collantes Fernando, University of Oviedo

Affluence is one of the most noteworthy dimensions of economic life in the global North since 1945. This paper, which is part of a book-length project on economists’ rival views of consumer society from 1945 to the present, positions the work of John Kenneth Galbraith within a longer-term perspective. It is argued that, even though Galbraith was the first economist who contributed a full-scale analysis of affluence and its implications, his work was grounded on a previous critical tradition that included Thorstein Veblen and John Maynard Keynes. The rise to dominance of neoclassical economics in the central part of the twentieth century was detrimental to this critical tradition, as consumer sovereignty came to be seen as the fundament of the economic and political order of market society. These rival views of the affluent society reflected not only a tension between surplus and scarcity as focal concepts of alternative economic theories, but also rival views about the degree up to which economic theories needed (or not) to be complemented with social and ethical theories. As Robbins-type neoclassical economics became dominant, the critical tradition represented by Galbraith came to be seen as heterodox, but some of its key insights can actually be traced back to the classical political economists and even early neoclassicals such as Alfred Marshall.

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Keywords: affluent society, consumer society, Galbraith, conspicuous consumption, advertising, consumer sovereignty, neoclassical utility theory, good life

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