Chicago School Paper - Essay Example

Chicago School Paper Thorstein Veblen was an economics who was based in the US. Many of the important writings that he did on the subject of economics were done in the early period of 1900s. His perspective did not encompass a limited version of economics. On the contrary his writings dealt with economics in the broader sense, inculcating the aspects of cultural and social anthropology. One of his most acknowledged works, The Theory of the Leisure Class, shed light on the concept of conspicuous consumption. His writings are representative of a fresh stance and opinion regarding human affairs and he posits about various aspects of the community in his writings (Hammond). On a general note, it is these qualities that make Veblin a legitimate precursor of the Chicago School. In most of his writings, Veblen has always presented an oppositional stance against Christianity; this is because the leisure class always used it as an appendix. Analysts have described Veblen’s interpretation of Christianity as a patriarchal religion who subserves the elite and the leisure class. However in his writing, Christian Morals and the Competitive System, Veblen takes a different stance. In the essay that was published in 1910, Veblen takes the Christian religion separately and discusses it in the context of the Western culture. In the essay and to subtle degrees in his other writings, Veblen talks about Christianity in good terms and discusses its morals as an important practice in the function of Western society. Veblen was of the perspective that Christianity is a promoter of love and self-abnegation amongst the people. However Veblin also argued that the Western society is not merely characteristic of Christian morals. It also has the tendency to be competitive. This gives rise to the dilemma if the two traits can co-exist at the same time. If contradictions between them emerge, it is necessary for people to choose either of the two. Moreover the question arises that what would the effect of such a choice be on the Western civilization (Meštrović 148). Veblen’s writings are characteristic of a perspective that contemporary social thought is essentially a burden on the “solitary, egoistic individual” (Meštrović 154). This burden could have been borne by people living in the 18th century. However the advent of the new century has seen changes in the market and the society. The 18th century, being typically driven towards the service of the community and the activities were also community-centred, could have provided a better environment for the application of the contemporary social thought. However the contemporary social thought has no place in a complicated, post-modern society (Meštrović 155). He argued that with the shift from feudalism to capitalism, competition and “pecuniary exploit” replaced “chivalric exploit”. The resulting habits of thoughts were being considered dysfunctional in the new era of capitalism. The habits of life were becoming a much more important part of the society as it moved towards a capitalist society. Although Veblen believed that Christian morals and rules of businesses stemmed from two differing cultural environments, they had some features in common. He correlated the two, and it may be this character that makes Veblen a suitable candidate for being a precursor of the Chicago School. He may not have fitted in other schools which placed greater emphasis on the historical and social specificity of value and economic theory. Veblen merged the concepts of Christian morals, adapted to the competitive workings of the European society. He was of the view that Christian principles could outlast business principles for improvement of human demeanour. This is not acceptable for schools which are more specific about the history and value of economics. Another professor at the Chicago School was Jacob Viner. Viner was regarded as one of the toughest professors at the Chicago School. His contributions to the concepts of how firms are modelled economically are still widely used and studied in the contemporary era. He divested upon various aspects of short and long run cost curves. Viner wrote over several important issues during the War period, ranging from economics and imperfect competition to international trade. One reason why Viner may not have fitted in other schools was because he was not supportive of the Keynesian Revolution. He was not against the policies that were proposed. In fact he himself had come up with them. He was in support with the various aspects of the government policies on spending. These policies had been advocated by Keynes himself. However he did not agree with other disciplines and was arguably of the view that the policies of Keynes were not sound and would not sustain the brunt of time and changing economic times. On the other hand, Viner was of the perspective that the Great Depression had occurred because of the deflating output prices, which was occurring at a faster pace than the decrease in costs. Therefore he argued that the only way the economy could come out of this vicious cycle is by restoring the profit margins and by the government causing inflation in the country. He posited that it was by deficit spending that the required price rise would occur. He did not believe in fixed rules; rather he was an advocate of policy discretion. Where the economists generally believed in the principles of monetary expansion, Viner vehemently disagreed with it (Economy Professor). This is also another cause of why he was a legitimate precursor of the Chicago School. Frank Knight is regarded as the light of the Chicago School and was one of its founders. He played an integral role in the establishment of the economics department at the School. He was a classic liberal and since the early part of his life, his perspective on economics constituted “hard-nosed, often entertaining scepticism” (Economic Insights 2011). He vehemently argued against the theorists and economists he encountered and was of the view that there could be no economic predictions by mathematical models. Moreover Knight was a staunch advocate of anticapitalism and criticized egalitarian provisions strongly. He was of the view that the social construct is a complicated game with some aspects winning while the others lost. He was of the view that income disparities would become yet wider and increase due to capitalism. He attacked anticapitalist notions of theorists such as Marx (Economic Insights 2011). Despite the fact that Knight questioned a lot of economists and did not believe in any utopian perspective of economic principles, he was regarded as an influential teacher by his students. His students may not have shared common thoughts with Knight, and Knight may have not supported their views either, he was still a legitimate fit in the system. This is because, as observed by a senior economist, Robert L. Formaini, that the Chicago School does not believe in “some monolithic set of beliefs to which all its members subscribe” (Economic Insights 2011). On the contrary, Knight provided the School with his vehement opposition and proposition of economic theories. His vehement scepticism along with his continued resilience and ability to support his stance made his perspectives the foundations of “the schools long and storied approach to theory and policy” (Economic Insights 2011). Thus in conclusion, the economics department at the Chicago School was characteristic of a free market system of economics and compromised of a general attitude of absence of any faith and credibility to the economics theories. The School and the aforementioned teachers were responsible for the creation of many noble laureates. The development of the thinking at the School makes Viner, Knight and Veblen as legitimate precursors to the School. Works Cited Economic Insights. Frank H. Knight—Origins of the Chicago School of Economics. Economic Insights, 2011. Web. Economy Professor. Jacob Viner. Economy Professor, 2011. Web. Hammond, L. James. Miscellaneous. L J Hammond, 2007. Web. Meštrović, Stjepan Gabriel. Durkheim and postmodern culture. Transaction Publishers, 1992. Print. Read More