Social institutions important for the new scientific psychology changed or were created in the nineteenth century. Because psychology began as an academic discipline, it was shaped by institutions of higher education that varied significantly from country to country. Germany led the world in scientific research and postgraduate education. Before Bismarck created the second German Empire in 1871, the German-speaking world was a collection of petty princedoms. Because each prince wanted his own university, Germany had more of them than any other nation. Moreover, Germany created the modern secular, government-supported, research-oriented university. In the United States, by contrast, small colleges run by religious denominations dominated higher education. Scottish commonsense psychology was an integral part of the curriculum, taught to polish the souls of the students. Thus, when Wundt created scientific psychology in Germany, he meant it to be a pure science, and early German psychologists resisted making psychology into psychotechnics. In America, the old Scottish psychology briefly opposed the new German scientific psychology. Although it nominally lost the struggle, its businesslike attitude remained, and American psychology turned to applications ranging from giving tests to building, as one psychologist said after World War II, a “science of values.”

If the research university was the dominant influence on nineteenth-century German psychology, business was the dominant influence on American psychology, reinforcing the practical orientation of the old psychology. In Germany, universities were centrally controlled by elite scientists and philosophers devoted to the pursuit of knowledge for its own sake. In the United States, colleges (and universities when they began) were diversely controlled by pragmatic business people devoted to the pursuit of practical knowledge, pushing American psychology to be more applied. Eventually, applied psychology sprang up everywhere, including Germany, and is now the main occupation of psychologists everywhere.

Psychology’s practical direction worldwide was reinforced by changes in the nature of government. During the nineteenth century, governments broadened their responsibilities from keeping peace and waging war to tending the general welfare of their subjects and citizens. Particularly in the United States, political and business leaders looked to science for new means of social control. After the Civil War, the nation moved from being a collection of isolated rural communities of relatives and neighbors to an urbanized, industrial, politically emancipated population of mobile strangers. Many opinion leaders, especially in the Progressive movement, thinking that tradition and religion were no longer suitable guides to life or effective means of social control, looked to the human sciences, including psychology, for new ways to manage society and business. In this environment friendly to expertise, learned professions and organizations arose in the late nineteenth century, including the American Psychological Association (APA) (1892). In his 1899 APA President’s address, John Dewey (1859-1952)—the great Progressive philosopher of the twentieth century—linked the birth of psychology to the social changes wrought by urban industrialization. As long as tradition was a sufficient guide to life, said Dewey, people had few conscious decisions to make, and a science of consciousness had little value. In a rapidly changing world, however, people have to make many new conscious decisions— where to live, what work to do, for whom to vote—and a science of consciousness came into existence.