Veblenian dichotomy

The Veblenian dichotomy is a concept first suggested by sociologist and economist Thorstein Veblen in 1899, in The Theory of the Leisure Class: An Economic Study of Institutions. Veblen made the concept fully into an analytical principle in his 1904 book, The Theory of Business Enterprise. Throughout these and many other writings by Veblen, this analytical principle was a distinction between what he called "institutions" and "technology".

To Veblen, institutions determine how technologies are used. Some institutions are more "ceremonial" than others. A project for Veblen's idealized economist is to be identifying institutions that are too wasteful, and pursuing institutional "adjustment" to make instituted uses of technology more "instrumental". Veblen defines "ceremonial" as related to the past, supportive of "tribal legends" or traditional conserving attitudes and conduct; while the "instrumental" orients itself toward the technological imperative, judging value by the ability to control future consequences.

The theory suggests that although every society depends on tools and skills to support the life process, every society also appears to have a "ceremonial" stratified structure of status that runs contrary to the needs of the "instrumental" (technological) aspects of group life.