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The Origins and Evolution of Consumer Capitalism A Veblenian Keynesian Perspective John P Watkins Ebook Full Chapter
The Origins and Evolution of Consumer Capitalism A Veblenian Keynesian Perspective John P Watkins Ebook Full Chapter
Capitalism; A Veblenian-Keynesian
Perspective John P. Watkins
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“John P. Watkins’ new book constructs a coherent historical narrative of the
emergence of modern mass consumer capitalism out of late nineteenth-early
twentieth century capitalism. It is masterfully written, and hopefully, will be
read by many economists and, most importantly, by the next generation.”
William Waller, Hobart and William Smith College
“In his new book, John P. Watkins has utilized the insights of two of the
greatest analysts of the paradoxical nature of American economic develop-
ment, Thorstein Veblen and John Maynard Keynes, to interpret the key mo-
ments of the last one hundred and fifty years of American capitalism. Thus,
this volume will be useful for those teaching or researching U.S. economic
history as well as those seeking texts that present an alternative perspective
to economic theory.”
Janet T. Knoedler, Bucknell University
The Origins and Evolution of
Consumer Capitalism
Consumer capitalism arose with the second industrial revolution, the appli-
cation of continuous-mass production to consumer goods during the late
nineteenth and early twentieth centuries. This book adopts a Veblenian,
Keynesian viewpoint, presenting an evolutionary view of consumption com-
bined with the need to increase demand to match increases in production.
The book traces the history of consumer capitalism, examining the paradox
posed by applying continuous-mass production to produce armaments for
dynastic ambitions versus consumer goods for the masses, manifesting it-
self in the world wars of the twentieth century. Multiple paradoxes at the
heart of the story address booms leading to busts, over-producing countries
in Asia relying on over-consuming countries in the West, and the expan-
sion of demand depending on increasingly inventive ways of liquefying as-
sets, in light of stagnant incomes. The book persuasively argues that these
paradoxes result from capitalism’s incessant drive to accumulate capital,
fostering conflict, crises, and depression. The latest paradox results from
the impact of continuous-mass production on the environment, manifesting
itself as the Darwinian dilemma. The dilemma stems from human beings
largely winning the struggle for existence and, in the process, possibly mak-
ing the earth uninhabitable, at least for humans.
47. Markets
Perspectives from economic and social theory
William A. Jackson
John P. Watkins
Designed cover image: © Getty Images
First published 2023
by Routledge
4 Park Square, Milton Park, Abingdon, Oxon OX14 4RN
and by Routledge
605 Third Avenue, New York, NY 10158
Routledge is an imprint of the Taylor & Francis Group, an informa business
© 2023 John P. Watkins
The right of John P. Watkins to be identified as author of this work
has been asserted in accordance with sections 77 and 78 of the
Copyright, Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or
reproduced or utilised in any form or by any electronic, mechanical,
or other means, now known or hereafter invented, including
photocopying and recording, or in any information storage or
retrieval system, without permission in writing from the publishers.
Trademark notice: Product or corporate names may be trademarks
or registered trademarks, and are used only for identification and
explanation without intent to infringe.
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library
DOI: 10.4324/9780429443763
Typeset in Times New Roman
by codeMantra
Dedicated to Sandra and Katie and to my readers struggling
to understand and resolve the paradoxes posed by our current
civilization.
Contents
List of figures xi
List of tables xiii
Preface xv
Acknowledgments xix
Index 213
Figures
DOI: 10.4324/9780429443763-1
2 The Origins and Paradoxes of Consumer Capitalism
Financialization culminated in the Great Financial Crisis (GFC), requiring
massive government intervention on behalf of financial institutions to avoid
an economic meltdown. The GFC gave rise to the Modern Monetary Theory
as a means of dealing with the GFC and, particularly, the Covid-19-induced
recession, overcoming the limits of the market economy. And the environ-
mental crisis resulting from the commodification of the natural world, ac-
centuated by applying continuous-mass production to the extraction and
burning of fossil fuels combined with a belief in infinite growth.
Consumer capitalism originated in the late nineteenth and early twenti-
eth centuries with the creation of a national market and the introduction of
continuous-mass production technology, initiating what Alfred Chandler
called “the second industrial revolution.”1 Chandler continues:
The industry’s output rose from 1.5 million cars in 1921 to 2.5 million
in 1922 and 4.3 million in 1923. But from 1923 until 1929 the market
leveled off, taking an average of a little under 4 million cars a year. As
had happened or would happen in so many American industries, the in-
itial demand for the new product had reached the level permitted by the
existing national income. Moreover, as has also usually been the case,
production potential exceeded demand. By the mid-1920s the country’s
automobile plants had a productive capacity of over 6 million vehicles.
(Chandler 1964, 13)
But to claim that the eighteenth century saw the birth of a consumer
society or that many aspects of that society were imbued with a new
The Origins and Paradoxes of Consumer Capitalism 5
commercial attitude should not be misinterpreted as a belief that by
1800 England had achieved all the features of modern consumer society.
Nor should it be assumed that the birth occurred without a long period
of gestation.
(McKendrick, Brewer, and Plumb 1985, 13)
Food represented the single largest expense in the first half of the nineteenth
century. Changes in living costs often change behavior. The increased scar-
city of firewood made home cooking more expensive, while advances in
transportation reduced the costs of basic foods. Changes in the cost of pre-
paring household items led to the decline in household production.