Credit, Production, and Wages in Thorstein Veblen's Economic Thought

Guglielmo Davanzati

International Journal of Political Economy, 2014, vol. 43, issue 1, 92-109

Abstract: The aim of this paper is to provide an interpretation of Veblen's theory of money, production, and wages, based on the view that his approach falls within the so-called monetary theory of production (MTP), and that significant elements of similarity with Keynes's view can be traced in his works. It will be shown that social conflict—driven by workers' reaction to a wage policy that violates the "limit of tolerance"—generates increases in employment. This effect occurs in a theoretical context in which the path of real wages is affected by (a) banking policy, via the manipulation of the interest rate, and (b) by the behavior of firms, in a context where—following Veblen—the firm is a locus of conflict, involving technicians (interested in expanding production) and "businessmen" (interested in gaining money profits via the management of the "pecuniary side" of the firm).

Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:mes:ijpoec:v:43:y:2014:i:1:p:92-109

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DOI: 10.2753/IJP0891-1916430108

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