Institutional economics and psychoanalysis: how can they collaborate for a better understanding of individual-society dynamics? Arturo hermann* may 2005

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Instincts and Evolution
Veblen's focus on habits draws attention to important aspects of the nature of human development and the role played by instincts (or propensions). This analysis is of special interest for our discussion as it brings under a unitary interpretative framework the complexity of the aspects making up human personality — biological, intellectual, affective — by considering them in their evolutionary pattern. The following passages express these concepts neatly,
"....The instincts are to be defined or described neither in mechanical terms of those anatomical or physiological aptitudes that causally underlie them or that come into action in the functioning of any given instinct, nor in terms of the movements of orientation or taxis involved in the functioning of each. The distinctive feature by the mark of which any given instinct is identified is to be found in the particular character of the purpose to which it drives. "Instinct", as contra-distinguished from tropismatic action, involves consciousness and adaptation to an end aimed at....The ends of life, then, the purposes to be achieved, are assigned by man's instinctive proclivities; but the ways and means of accomplishing those things which the instinctive proclivities so make worth while are a matter of intelligence....The higher the degree of intelligence and the larger the available body of knowledge current in any given community, the more extensive and elaborate will be the logic of ways and means interposed between these impulses and their realisation, and the more multifarious and complicated will be the apparatus of expedients and resources employed to compass those ends that are instinctively worthwhile....all instinctive action is intelligent in some degree. This is what marks it off from the tropism and takes it out of the category of automatism.

Hence all instinctive action is teleological. It involves holding to a purpose.", (Veblen, 1914: 4, 5-6, 6, 31).

Veblen’s analysis cannot be considered a complete theory of instincts, and, as we will see in the analysis of Freudian theory, this circumstance is typical of any theory of instincts. Notwithstanding this difficulty, we think that Veblen was able to grasp a point — to be taken up at greater length in the chapter on psychoanalysis — which we deem central for a better understanding of human behaviour: that instincts are the expression of the complex interplay between the biological, affective and intellectual aspects of personality.

In Veblen's analysis, workmanship5 and parental bent6 are held to be the most important human instincts, tending to prevail in a situation where other instincts that may act at cross-purposes — for instance, predatory instincts which may be expressed through a framework of ceremonial and "acquisitive" institutions based on invidious distinctions — had little social grounds on which to express themselves. In this regard, Veblen seems to suppose that the first stage of human life was like this and, since then, a number of disturbing factors7 have caused a process of deviation which was reinforced by a process of cumulative habituation. This idea is expressed in the following famous passage,

"....Human culture in all ages presents too many imbecile usages and principles of conduct to let anyone overlook the fact that dissearviceable institutions easily arise and continue to hold their place in spite of the disapproval of native common sense. The selective control exercised over custom and usage by these instincts of serviceability is neither too close nor too insistent....It appears, then, that so long as the parental solicitude and the sense of workmanship do not lead men to take thought and correct the otherwise unguarded drift of things, the growth of institutions — usage, customs, canons of conduct, principles of right and propriety, the course of cumulative habituation as it goes forward under the driving force of the several instincts native to man,— will commonly run at cross purposes with serviceability and the sense of workmanship.", (Veblen, 1914: 49, 49-50).
In this evolutionary process, as observed before, technological progress — by inducing more rational habits of thoughts and life — is deemed to play an important role in social evolution. Technological progress, in turn, depends on the characteristics of the capitalistic system which tends, although through a far from straightforward pattern, to substitute new systems of production for older ones.

Technological progress modifies not only the material world but also, through a process of learning, adaptation and habituation, the ways of thinking and acting. This process, depending, as it does, on the interplay of many factors which are mostly uncertain and path-dependent, is not considered in Veblen’s analysis as having a teleological character.

The reason why Veblen regards technological progress so crucial for changing individual behaviour arises from his observation that, along with the instincts of workmanship and parental bent, people also have an instinctive tendency to resist change.

The extent to which workmanship and efficiency prevail on the tendency to resist change depends largely on the characteristics and intensity of technological progress. In fact, by inducing individuals to adapt themselves to new methods of production, technological progress brings out, through a process of habituation to new habits of thoughts and life, the workmanship instinct.

For this reason, technological progress is considered paramount in order for people to eliminate habits of thoughts based on more primitive stages of life — mainly based on ceremonial and "acquisitive" institutions — and to acquire a scientific and matter-of-fact mentality, which represents the essence of instrumental behaviour.

In Veblen's view — although not very clear for many aspects — the pivotal element of technological progress able to induce such profound social transformations can be summarized as follows: technology, in becoming more and more "colourless and impersonal", makes it increasingly difficult for the person to impute to his or her work instruments aspects of magical workmanship that go beyond their objective characteristics.

For instance, the ancient handicraftsman who used simple instruments with great ability, could more easily have attributed to his instruments anthropomorphic characteristics than the worker operating in a big and impersonal factory. Through this process of imputation, according to Veblen, the rational and objective aspects of technology tend to be overlooked in favour of a magical and "ceremonial" vision of the world.

This process of imputation, in his view, while not impinging upon the acquired ability of the workers, is likely to impair future technological advances by instilling in the workers habits of thoughts and life not oriented towards the progressive "rationalization" of technology.

This tendency to "personify" the world never completely disappears with the development of technological progress, since it is considered by him a sort of congenital weakness of human nature.

At present, we wish only to observe that although in Veblen’s analysis technological progress seems to acquire, in some respects, the character of an ineluctable drive, this does not imply that he considered human development in a deterministic way.

Even a superficial reading of his works shows that whenever confronted with the possibility of foreseeing a situation, Veblen was extremely aware of the difficulty of this task. In particular, at the end of his book — The Instinct of Workmanship and the State of Industrial Arts Veblen was quite aware that technological progress, per se, was not sufficient to induce a more rationalistic behaviour (in substantive terms), due to the complex and interrelated role played by psychological, social, economic and technological factors in determining the dynamics between individuals and institutions. This complexity emerges clearly when he speaks of revulsion against technology,
"Nor is it by any means a grateful work of spontaneous predilection, all this mechanistic mutilation of objective reality into mere inert dimensions and resistance to pressure; as witness the widely prevalent revulsion, chronic or intermittent, against its acceptance as a final term of knowledge. Laymen seek respite in the fog of occult and esoteric faiths and cults, and so fall back on the will to believe things of which the senses transmit no evidence; while the learned and the studios are, by stress of the same 'aching void,' drawn into speculative tenets of ostensible knowledge that purport to go nearer to the heart of reality, and that elude all mechanistic proof or disproof....Neither the manner of life imposed by the machine process, nor the manner of thought inculcated by habituation to its logic, will fall in with the free movement of human spirit, born, as it is, to fit the conditions of savage life. So there comes an irrepressible—in a sense, congenital—recrudescence of magic, occult science, telepathy, spiritualism, vitalism, pragmatism.", (Veblen, 1914: 333-334).
>From this passage it appears that Veblen regarded technological progress, at least in our view, only as a useful way to acquire more scientific-based habits of thoughts and not as a goal in itself. He believed that people, by acquiring these more technology-based habits of thoughts, would become more able to develop an improved assessment of all the matters regarding their lives. In this sense, Veblen’s theory appears to be very different from any positivistic position.

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