Thorstein Veblen (1857-1929) was a founding father of the 'old' institutional economics. Strikingly, some of his ideas are enduringly relevant today, including his application of Darwinian principles to economic evolution. In particular, his ideas are remarkably consonant with findings in modern evolutionary psychology. Furthermore, his elaboration of the role of habit in human decision-making and behaviour provides a grounding for an approach which escapes from the old dichotomy between methodological individualism and methodological collectivism. This paper will illustrate these ideas by using insights from modern economics and psychology.