Among distinguished sociologists, Thorstein Veblen developed an economic sociology of capitalism that criticized the acquisitiveness and predatory competition of American society and the power of the corporation. In The Theory of the Leisure Class he argued that the dominant class in American capitalism, which he labelled as the 'leisure class', pursued a life-style of conspicuous consumption, ostentatious waste and idleness. Veblen Effects is named after him.
Thorstein Veblen explains that members of the leisure class, often associated with business, are those who also engage in conspicuous consumption in order to impress the rest of society through the manifestation of their social power and prestige, be it real or perceived. Social status, Thorstein Veblen explained, becomes earned and displayed by patterns of consumption rather than what the individual makes financially.
In The Higher Learning in America, Thorstein Veblen claimed that the universities were dominated by considerations of profitability, economic patronage, and self-interest, and had no commitment to true academic values. In The Instinct of Workmanship, The Place of Science in Modern Civilization and The Engineers and tile Price System, Veblen optimistically suggested that engineers, who embodied the spirit of science and technology, would replace the parasitic leisure class.
People in other social class are influenced by this behavior and strive to emulate the leisure class. What results from this behavior, is a society characterized by the waste of time and money. Unlike other sociological works of the time, The Theory of the Leisure Class focused on consumption, rather than production.
In The Theory of the Business Enterprise and Absentee Ownership and Business Enterprise Thorstein Veblen considered the distinctive features of U S capitalism, such as the separation of ownership and control and the oligopolistic power of the giant corporation.
During the First World War, Thorstein Veblen published Imperial Germany and the Industrial Revolution. Thorstein Veblen regarded warfare as a threat to economic productivity, which he defined as the production of useful commodities and services. Thorstein Veblen contributed to the analysis of American diplomatic strategy in An Inquiry into the Nature of Peace and the Terms of its Perpetuation.