# The Theory of Business Enterprise

THE THEORY OF
BUSINESS ENTERPRISE
THE THEORY OF BUSINESS ENTERPRISE
BY
THORSTEIN VEBLEN
ASSISTANT PROFESSOR OF POLITICAL ECONOMY IN THE UNIVERSITY OF CHICAGO
CHARLES SCRIBNER’S SONS
NEW YORK • • • 1904
COPYRIGHT, 1904. BY
CHARLES SCRIBNER'S SONS
Published September, 1904
PREFACE
In respect to its point of departure, the following inquiry into the nature, causes, utility, and further drift of business enterprise differs from other discussions of the same general range of facts. Any unfamiliar conclusions are due to this choice of a point of view, rather than to any peculiarity in the facts, articles of theory, or method of argument employed. The point of view is that given by the business man's work,—the aims, motives, and means that condition current business traffic. This choice of a point of view is itself given by the current economic situation, in that the situation plainly is primarily a business situation.
A much more extended and detailed examination of the ramifications and consequences of business enterprise and business principles would feasible, and should give interesting results. It might conceivably lead to something of a revision (modernization) of more than one point in the current body of economic doctrines. But it should ​apparently prove more particularly interesting if it were followed up at large in the bearing of this modern force upon cultural growth, apart from what is of immediate economic interest. This cultural bearing of business enterprise, however, belongs rather in the field of the sociologist than in that of the professed economist; so that the present inquiry, in its later chapters, sins rather by exceeding the legitimate bounds of economic discussion on this head than by falling short of them. In extenuation of this fault it is said that the features of general culture touched upon in these chapters bear too intimately on the economic situation proper to admit their being left entirely on one side.
Of the chapters included in the volume, the fifth, on Loan Credit, is taken without substantial change, from Volume IV of the Decennial Publications of the University of Chicago, where it appears as a monograph.
CONTENTS
* CHAPTERPAGE
* I.Introductory................................................................................................................................................................................................................................................................................................................................................................................................1
* II.The Machine Process................................................................................................................................................................................................................................................................................................................................................................................................5
* III.Business Enterprise................................................................................................................................................................................................................................................................................................................................................................................................20
* IV.Business Principles................................................................................................................................................................................................................................................................................................................................................................................................66
* V.The Use of Loan Credit................................................................................................................................................................................................................................................................................................................................................................................................92
* VI.Modern Business Capital................................................................................................................................................................................................................................................................................................................................................................................................133
* VII.The Theory or Modern Welfare................................................................................................................................................................................................................................................................................................................................................................................................177
* VIII.Business Principles in Law and Politics................................................................................................................................................................................................................................................................................................................................................................................................268
* IX.The Cultural Incidence of the Machine Process................................................................................................................................................................................................................................................................................................................................................................................................302
* X.The Natural Decay of Business Enterprise................................................................................................................................................................................................................................................................................................................................................................................................374