In Thorstein Veblen S Famous Essay Why Is Economics Not An Evolutionary Science He M 3313293

In Thorstein Veblen’s famous essay, Why is Economics not an Evolutionary Science, he makes his famous critique of the “hedonistic” assumptions of “classical economics”. The hedonistic conception of man is that of a lightning calculator of pleasures and pains, who oscillates like a homogeneous globule of desire of happiness under the impulse of stimuli that shift him about the area, but leave him intact. He has neither antecedent nor consequent. He is an isolated, definitive human datum, in stable equilibrium except for the buffets of the impinging forces that displace him in one direction or another. Self-imposed in elemental space, he spins symmetrically about his own spiritual axis until the parallelogram of forces bears down upon him, whereupon he follows the line of the resultant. When the force of the impact is spent, he comes to rest, a self-contained globule of desire as before. (Veblen 1898: 389-390) Unfortunately, not much has changed since Veblen wrote this paper. The most prominent assumption in neoclassical models, the “rational economic agent”, is no different from the hedonistic “lightening calculator” that Veblen criticized over a century ago. While these assumptions may be useful for isolating variables and analyzing mechanisms, they limit the real world application of Neoclassical models. This narrow methodological approach leaves little room for institutional arrangements, things like culture, social norms, and other important factors that can shape behavior. Old Institutional Economics tries to mitigate this gap in Neoclassical Economic theory. Summarize, in your own words, the criticism Veblen makes about neoclassical economics. What aspect(s) of the neoclassical framework is he criticizing? What, in the author’s opinion, do the neoclassical models leave little room for, and why might this be problematic?