The Importance Of Time

Conventional wisdom fails to understand that operating
in a time-limited mode involves significantly different
behavior and attitudes from operating in a goods-limited mode

One of the articles in Economics In An Intellegent Universe (IC#2)
Originally published in Spring 1983 on page 50
Copyright (c)1983, 1996 by Context Institute

OF THE THREE types of input that every activity needs – material goods, skills, and time – I’ve come to feel that perhaps the least understood is time. In conventional economics, it is treated as a commodity (“time is money”) to be bought and sold at will, and therefore needing no special consideration. Yet experience suggests that the economics of time is not quite so simple. The following excepts from The Household Economy by Scott Burns bring out some of the key issues.

“We need time. We need time to work, to eat, to sleep, and to accomplish all the daily chores of living. We also need time to know and understand our mates, our children, and our friends. Most of our relationships, in fact, require more time than we have, and it is difficult to avoid the feeling that we could never have enough. Nor is our list of demands on our time complete. We have ignored the time we need to be alone, a necessary but invariably short- changed period. . .

“All these demands come before the proliferating hardware used in the consumption of still more time – before the possession, use, and maintenance of automobiles, small and large boats, tennis rackets, skis, and golf clubs, sewing machines and looms, bathing suits, hi-fi sets, tape decks, cameras, etc. All these things – the inevitable trappings of affluence – make still more demands on our ever-diminishing store of time. They are responsible for many of the sour notes sounded as affluence becomes more general and more disappointing. . .

“The limit to all of this has been explored by economist Staffan Burenstam Linder. If it requires time to produce things, it also requires time to maintain and consume them. While this may seem obvious to the harried, it is neglected in most economic literature. If we assume that each worker has a total of sixteen hours to “spend” and that each hour of productive work also requires a half hour of maintenance or personal work time (including eating, dressing, washing, etc.) and a half hour of consumption time, then we can expect an increasing pressure on our available time if we produce an increasing amount of goods in our hours of directly productive work. If a new machine doubles the output of goodies, we then will have twice as much product for the same amount of work. While this may be a delight, it also means that we have twice as much consuming and maintaining to do in our “non-work” hours. Thus we become ever more harried as our productivity increases.”

Each of us has only 24 hours a day and no one else can live our lives for us. This obvious yet profound fact means that time is potentially the major limiting factor in our personal economies, and therefore in our societal economies as well. We can explore this further with the help of the benefit/cost diagram from my previous article:

How does it apply when the input (running along the bottom) is time spent in some particular activity, e.g. time spent earning money?

Let’s look at the benefit curve first. Assuming a constant $/hr rate for different working times, the benefit curve simply says: as income increases, the benefit increases also, but more slowly due to diminishing returns – just what we would expect. But what about the cost curve? What is the “cost” of time? Obviously, it is not something we have to pay to someone else; rather, it is the loss of other options that choosing some particular activity for that time imposes on us. Our 24 hours is always full. Adding a new activity always requires dropping or reducing something else. The cost of the time spent on any given activity is the value to us of what we otherwise would have been doing with that time.

As we increase the time spent on any one activity (like earning money), we must give up more and more valuable other activities. Thus the behavior of the cost curve correctly describes the “cost” of time. The result is that the net benefit curve for that activity has a maximum at some limited number of hours. If your actual number of hours spent earning is less than this optimum, material goods are the limiting input in your life, while if you are beyond the optimum, you are time-limited.

Next, let’s consider the impact of gaining either new skills or new usable possessions. Both of these make your time more valuable, and thereby raise the level of the “cost of time” curve. Often, they will also enable you to make better use of the other material goods you have, allowing you to maintain your quality of life at a lower level of consumption. The effect of this on the benefit curve is a little complex. At the low end of the curve, it makes the curve rise more steeply because you are now getting more benefit out of the first dollars you earn (stretching each one farther). However, since you need fewer total dollars to support your quality of life, the “diminishing returns” bend in the curve sets in sooner at a lower number of hours worked. The result is that the optimum value of your net benefit curve moves up (you can get more out of life) and to the left (if you work fewer hours).

This result is very general. It applies not only to the amount of time you spend earning money, but also to the time you spend in any activity. It is affected not only by increases in business productivity (as Burns describes), but by any new skill or possession – by increases in productivity in any aspect of our lives. This shifting of the optimum is accelerated in an information society where learning can spread rapidly, and low-cost experience-oriented activities, such as running and meditation, are increasingly competing with more expensive ways of spending personal time. It is unfortunate that most people do not have much choice in adjusting the number of hours on the job (it is either zero or full time), so most people are not operating at their optimum. I don’t have any statistics on this, but my impression is that a great many people are on the time-limited side of their curves. You are if there are more things you could do and would enjoy doing than you have time for.

There are situations that can cause your optimum to move in the other direction. This will happen if your effective hourly rate declines (either because goods cost more or your wage declines), or if some new goodie on the market catches your eye and makes your current life seem dull and incomplete without it (thereby depressing the value of your current activities). Growing tired of “the same old things” is similarly depressing.

If you are operating beyond the survival level so that many of the needs you are meeting through the marketplace are basically psychological, then clearly attitude can play a major role in determining relative values. This means, among other things, that psychological skills that enable you to change your attitudes or meet your psychological needs directly can have a major impact on your quality of life and the position of your optimum. Likewise, external psychological manipulation (e.g. advertising) can also push your optimum around. In an economy such as ours, where only a small percentage of overall activity is directed towards real survival needs, the position of a person’s optimum can be quite volatile – more influenced by feelings than by external conditions.

If you are on the goods-limited side of the optimum, our society has clear and obvious advice – get out and work harder. (You might really need to learn to use your resources more skillfully, but that option isn’t as well promoted.) But if you are time-limited, the conventional wisdom is not much help. It may suggest that you should pay someone else to do some of your chores, but that is only of limited help. You can’t pay someone else to have your relationships, or savor your sunsets, and besides, that can never be a general solution for a whole society. It may suggest that you manage your time better, but that too works only up to a point. After you have done all that and you are still time-limited, what next? The fundamental thing that our conventional wisdom fails to understand is that operating in a time-limited mode involves significantly different behavior and attitudes from operating in a goods-limited mode.

It makes one very much aware of limits. Unlike acquiring goods, where you are not physically limited in the number you can pile up, acquiring new activities (that may come as a consequence of some new possession) always requires giving up something else. If you are time-limited, you value that something else. You are in a position of having to choose between the good and the better. In this way, it also makes you deal with death, for you need to choose to let old activities die. Whereas the battle cry of a goods- limited society is “More”, the goal of a time-limited society has to be refinement – working to improve the quality that exists within the fixed boundaries of the 24 hour day.

I can’t help but feel that one of the major blockages in our culture is that we are trying to apply the attitudes and institutions that grew out of a goods-limited era to a time when (at least within our society) people are increasingly time-limited. It is not that goods are in absolute surplus, but they are no longer the primary limiting factor, and they would be even less so if we had better modes for distributing both work and wealth. If we understood this shift, we would not be trying to “get the economy moving again” and create more jobs, we would be working towards more job- sharing. We would welcome the gradual decline in the amount of time spent in the market economy as a sign of our economic progress.

We are fortunate that an information society pushes us in the direction of being time-limited, for this experience may well provide the archetypal attitudes that are needed for a sustainable culture. An information society pushes us in this direction because the inevitable consequence of learning is to become more skilled in living and thus for the value of one’s time to rise. (As Burns indicates, the more our productivity increases, the more we have to shift our time away from making things to using them.) This experience provides us with the needed archetypal attitudes because the finiteness of the 24 hour day is a perfect analog at the personal level for the finiteness of our earth.

Dealing with refinement and choice in our own lives will teach us how to steward the planet. And because being time-limited also makes us sometimes feel “I wish I were three people” (because of all the wonderful things we could do if we had the time), it gives us a new appreciation for the preciousness of each human life. “Because I can’t do it all, I’m so glad you are here to do what you do. Through your doing and sharing, my experience of life is enriched.”

I know many people, myself included, who often feel “time poor” and who bemoan this limitation. Perhaps this attitude is a great mistake. Perhaps if we were to embrace the limitations of time, to celebrate them and explore their implications, we would find that they hold an essential key to the fundamental attitudes and experiences we will need in a humane sustainable culture.

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