Abstract:

Institutional economics has an essential part in the history of economical thought and its most important pioneer is T.B. Veblen. As the founder of this school, Veblen created many concepts for the history of economical thought such as conspicuous consumption, social-class consumerism, leisure class and social stratification besides institutional economics. Additionally, he had also taught students; Mitchell, Commons, Galbraith who established the theoritical background of institutionalism and critisized orthodox economic theory. This study intends to seek the effects of the doctrines that institutionalist school benefit to criticize the orthodox economic theory and also look to the doctrines of Veblen and his proponents that established the basics of institutionalism within a focus Veblen’s his own life in order to give a comprehensive understanding to indicate the concepts and how these concepts carried the history of thought to an another level and how this doctrine affects the contemporary thought of economy. Veblen however was accepted as a difficult philospher to understand for his eclectic way of thinking with his superficial ideas, one should not diminsh him. Instead, he grounded himself as a multidimensional economist in heterodox economic movement with his interdiciplinear study. and his thoughts have been a guide to the economics scholars of the past, today and the future. Veblen’s student Wesley Clair Mitchell who is known for his evolutionary economics approach in new world order that signifies the continuing change and development of economics, emphasizes the importance of Veblen in social sciences and how Veblen’s doctrines professionalize the scientific thought: ‘T.B.Veblen has an uncomfortable effect on people.; he was a visitor from another planet who examines of every shred of conventional ideas of his students; emanating from the familiar thoughts of the era that these students unconciously learned as those ideas are the odd products processed by strange forces to their brains…There is no other person in social sciences who emancipates mind from the unexplanatory enforcement of conditions and broadens the borders of reasoning.

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