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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. Spiritually, the hedonistic man is not a prime mover. He is not the seat of a process of living, except in the sense that he is subject to a series of permutations enforced upon him by circumstances external and alien to him [Veblen, 1919, 73-4].
Partly because of Veblen’s satire, modern neoclassical economists no longer openly embrace Edgeworth’s shocking view of human nature. Modern neoclassical economists continue to assume that people are utility maximizers, but they claim that it is only a modeling device. In other words, they do not openly say that people really are pleasure machines. The assumption is made because, in their view, models based on the assumption of utility maximization predict well. The approach is defended in Milton Friedman’s famous article, “The Methodology of Positive Economics” [1953]. Friedman argues that a model’s ability to predict is the only thing that matters in judging how good the model is. In his view, the realism of the assumptions is irrelevant. It follows that one can assume whatever one wants about human behavior as long as one’s model predicts well. What is left unspoken is the fact that while the approach may be useful for predicting seasonal variations in the consumption of ice cream, it is not capable of addressing more fundamental questions such as the evolution of economic institutions. For Veblen, these more fundamental questions were of primary importance.
The main alternative to neoclassical economics at the time was the economics of Karl Marx. Marx was interested in some of the same basic questions as Veblen, but took an approach different from