Veblen and Technical Efficiency

It is well known that Thorstein Veblen accused the turn-of-the-century captains of industry of sabotage. What is not so well known is that, for Veblen, sabotage was not simply a pejorative term. By sabotage, he meant a conscientious withdrawal of [Veblen 1990a, 38]. But efficiency, as both Veblen and a number of the engineers of his time used the term, was not the now-standard microeconomic efficiency represented by the minimum point on a U-shaped long-run average total cost curve. Veblen espoused a technical, rather than a cost-based, definition of efficiency. The difference between these two views of efficiency can best be understood by focusing on some of the early engineers-in particular the early Tayloritesfrom whom Veblen borrowed heavily and who were in turn influenced greatly by Veblen in their own thinking about efficiency.