Global Pecuniary Emulation: A Case Against Globalization

Global Pecuniary Emulation: A Case Against Americanization

International affairs, globalization, and economics literature often speaks of a concept of "Americanization." By this the authors generally attempt to portray that globalization in the 21st century has consistently been an example of the rest of the world adopting American culture instead of a true global exchange between all nations. Often, the advocates of this position view the perpetrators of Americanization as multinational corporations, the United States government, or other multilateral organizations that the United States plays a large role in, such as the IMF or World Bank. Even Thomas Friedman, a staunch advocate of Globalization, argues that there is a connection
between the two processes:
Globalization is in so many ways Americanization: globalization wears Mickey Mouse ears, it drinks Pepsi and Coke, eats Big Macs, does its computing on an IBM laptop with Windows 98. Many societies around the world can't get enough of it, but others see it as a fundamental threat.
Yet, Thomas Friedman also seems to suggest, unlike others, that the societies are to blame for this Americanization, not just the United States. One could say then that the debate between Americanization and Globalization hinges not on the effects of such a transformation, but rather on the actors who create this transformation. Focusing on this critical aspect, the author contends that the theories of the early 20th century economist, Thorstein Veblen, help to elucidate proof that Globalization inherently consists of a process of global pecuniary emulation entirely separate from any sinister concept of Americanization. In The Theory of the Leisure Class, Thorstein Veblen details his theories behind what he terms so eloquently the leisure class, but what most would think today of as the upper class. He chronicles the historical formation of such a class and outlines the various effects that this class has on society as a whole. Veblen's explanation for the creation and continuation of the leisure class is what he calls pecuniary emulation:
Relative success, tested by an invidious pecuniary comparison with other men, becomes the conventional end of action. … Purposeful effort comes to mean, primarily, effort directed to or resulting in a more creditable showing of accumulated wealth. Among the motives which lead men to accumulate wealth, the primacy, both in scope and intensity, therefore, continues to be belong to this motive of pecuniary emulation. (p.33-34)
Veblen, writing after the groundbreaking works of Freud, speaks of economic motives in much more psychological ways than the economists before him, such as Karl Marx or Adam Smith. Each person strives for wealth, not because it allows one any special rights or responsibilities, but rather as an end in itself because it satisfies what Veblen refers often to as a "spiritual need." Veblen's pecuniary emulation leads to his infamous remarks regarding "conspicuous leisure" and "conspicuous consumption" because these are the vehicles by which one proves to one's peers that he/she is "wealthy." Veblen's book, though, does not deal simply with the esoteric world of the upper echelon of society. Instead, the impulse of pecuniary emulation drives everyone to compete within their own class to prove their "relative success." The fact that workers in a factory are often more concerned with what their fellow worker makes than the managers that oversee them demonstrates Veblen's point that society stratifies itself into classes which compare between themselves but not across classes. As a hypothetical example, the postal worker does not expect to ever buy a Ferrari as a weekend car like the CEO would, but he might buy a second car to prove to his colleagues his wealth. The postal worker has less opportunity to purchase a Ferrari due to the fact that most of the money he earns goes towards providing the food, clothing, shelter, etc. he needs to survive. By comparison, the CEO spends a minimum of his overall salary on these items and therefore has more money to spend on items for pecuniary emulation. To sum up Veblen's ideas, he aptly recognized that the further that mankind moves away from having to spend all one's time on satisfying the material needs of minimal subsistence the more that the psychological drive of pecuniary emulation takes over as our primary motive.
As already elaborated in the postal worker and CEO example, Veblen outlines the notion that there are different levels of pecuniary emulation within different classes of society.
Yet, Veblen expands this thought to include the fact that the lower classes still tend to focus on the actions and examples of pecuniary emulation. In the hypothetical example, despite the fact the postal worker could not have a Ferrari as a second car, he still pursued the idea of a second car because he viewed the act as something that someone in the upper class would do. Veblen details his theory that the actions of the upper class filter through to the lower
classes:
The leisure class stands at the head of the social structure in point of reputability; and its manner of life and its standard of worth therefore afford the norm of reputability for the community. The observance of these standards, in some degree of approximation, becomes incumbent upon all classes lower in scale. In modern civilized communities the lines of demarcation between social classes have grown vague and transient, and wherever this happens the norm of reputability imposed by the upper class extends its coercive influence with but slight hindrance down through the social structure to the lowest strata. (p.84)
In this quote, Veblen alludes to what he later refers to as the pecuniary canons of taste. In today's world one would most likely refer to the leisure class as trendsetters. They set the standard for what's hot and what's not. Later on in the book, Veblen discusses the fact that items that are novel or rare tend to be more likely to be wanted than those that everyone has. Looking at our hypothetical example, one notices a sort of continuous interplay between classes. The CEO would be less likely to buy the Ferrari, if he knew that the postal worker could also buy one and thus consequently because the postal worker cannot buy the Ferrari he strives to "approximate" the CEO. In addition to Veblen's idea of the lower class attempting to follow the same pecuniary canons of taste as the leisure class, he also remarks that as "the lines of demarcation" break down between the two classes the effect of the actions of the upper class extend more to the lower classes. Intuitively, this statement makes sense because if the lower classes cannot observe the pecuniary struggle of the upper class then they cannot mimic the pecuniary struggle. Historically, the claim makes sense as well in that prior to capitalism the various classes kept themselves much more separate than in today's world. In the feudalist period, for example, one has a sense that the peasants worked the fields in the countryside, the merchants traded in the small villages while the kings, lords, etc. ruled from within the castle walls. Overall, Veblen's theory not only concludes that pecuniary emulation exists among all classes to a greater or lesser degree, but also that the lower classes continually try to copy the actions of the lower class while the upper class must continually reshape their canons of taste as the lower class approximation moves to close to the upper class pecuniary standard of living. Under the lens of Veblen's theory, the debate between actors that leads one to a contemporary notion of Globalization or Americanization now can be further elaborated.
Globalization acts as the catalyst for the transformation from a situation of pecuniary emulation within a country or group of countries to a situation of global pecuniary emulation precisely because it breaks down the communication borders that existed between nations. Globalization brings together people better through the use of the internet, satellites, mobile phones, etc. For this reason, there no longer exists "lines of demarcation" between the wealthier developed nations such as the United States and the poorer developing countries of the world. This allows the citizens of other nations to have a concept of American culture that they would not otherwise have a chance to access. While the United States may for both capitalistic and political reasons be trying to pawn its culture off on other countries, these other countries are by no means forced to look to the United States. Instead, the reason that these other countries have chosen to act American runs strictly from the notion that these countries view the United States as the preeminent leisure culture. One could argue, of course, that the goods and ideas that represent American culture are just better and so as an economic choice these other nations are choosing the United States, but in most cases the goods, for example, are being made all
over the world and the other countries have equal or better substitutes for American culture. The movie industry represents a good notion of this because it acts as both a good and a cultural exchange of ideas. Despite the fact that countries in places such as India and France produce just as many movies as the United States if not more, the United States continues to be considered the global leader in the film industry. The Russians obsession with American jeans comes to mind as well because although jeans might not necessarily be the best form of clothing for Russians to wear, they continue to be sought after as hot commodities. To conclude, the notion that Americanization stems from an attempt on the part of the United States to subdue other countries culturally and to take advantage of them economically simply does not fit with the facts. Globalization as a process equally allows an American to learn about what's going on in China as vice versa. Rather, a process of global pecuniary emulation has pushed the United States to the head of the pack in terms of conspicuous leisure and conspicuous consumption so that most Americans today choose to focus less on the actions of those in China as the Chinese do on those in the United States.