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both Veblen and the neoclassical economists. In Marx’s view, one’s behavior is shaped by one’s circumstances. How one acts and thinks depends on one’s social class. Workers think differently than owners because their experiences are so different. Ironically, the only trait common to all classes is one that would be right at home in neoclassical analysis, namely rational self-interest. Class struggle occurs as different classes fight to advance or to protect their interests. The idea of class struggle clearly presupposes that members of each class understand their interests. This means that they are capable of penetrating the veneer of society and perceiving its deeper reality.
As history progresses, both material and social conditions change. According to Marx, human behavior must inevitably change as well because external conditions determine how people think. As Marx famously put it, “It is not the consciousness of men that determines their existence, but, on the contrary, their social existence that determines their consciousness” [Marx, 1859, 4]. Unlike the neoclassical view that posits an unchanging human nature, Marx believes that human nature is a product of the environment. To put it differently, the neoclassical view is that human behavior is completely determined by nature, and Marx’s view is that it is determined completely by nurture.
Veblen’s view of human behavior is more complex than that of either the neoclassical economists or of Marx. In his view, both nature and nurture shape human behavior. Nature endows humans with innate behavioral tendencies that Veblen called instincts. Instincts are themselves subject to evolutionary change over long periods of time. Nurture, in the form of institutions such as learned habits of thought and social conventions, also influence our behavior. Institutions can also evolve and change over time.