Development and Underdevelopment in the History of Economic Thought

Culture, evolution and the relevance of a Veblenian framework

Ambrosino Angela, Università di Torino

Thorstein Veblen endeavored to explain how habits are established, particularly the roles of instincts and culture in the formation of habits. The mechanisms that explain how habits of thought change, in other words how institutional change takes place, are relevant to develop a framework to solve the well-known agency structure problem. Developments in the theory of (social) evolution could be used to address the above listed points. An exercise of re-reading Veblen’s contributions can help us to explicate (a) how Veblenian framework could further be developed by incorporating new insights from modern evolutionary approaches, e.g. dual inheritance theory and cognitive approaches, and (b) the relationship between behavioral and cognitive approaches and instinct-habit psychology. Contemporary approaches stress the fact that social and cultural environment have an effect on the evolution of individuals’ behavior. Moreover, they argue that investigating the so-called micro foundations of behavior and determining the rise of social norms at the societal level need a multidisciplinary approach, i.e. contributions from disciplines such as psychology, anthropology, economics and philosophy are necessary. Veblen is indeed a forerunner of these approaches since the above depicted characteristics of contemporary evolutionary theory could be found in his studies. According to Veblen, economics is a dynamic system characterized by cumulative causation, in which habits are subject to selection and change. Yet, even though he laid down the principles of an evolutionary approach, precise sources and process of institutional evolution are lacking in his studies. Contemporary evolutionary approaches are relevant to fill in this gap. Dual inheritance theory and evolutionary game theory offer insights into how to link the behavior of (heterogeneous) individuals and outcomes at the group level, i.e. collective behavior. Moreover, cognitive approaches go beyond theorizing the behavior o


Keywords: habits, learning, conformism, social evolution, Thorstein Veblen