The value of your time should include rest hours (and analogies from the world of work)
Lots of people in EA/rationality spheres are interested in concepts of ‘the value of one's time’ or ‘trading money for time’ - for example they might talk about whether it's worth it to hire a cleaner, or take an uber rather than a bus, because it costs you money but saves you comparatively more time.
In these discussions, it's usually assumed that the value of your time is something like your hourly salary or hourly rate. (This seems true from the first few 'non-EA-world' google results too). So e.g., if you make $20/hour (the theory goes), it's not worth it to spend an hour to save less than $20 (by, say, taking a slower and cheaper bus rather than a faster and more expensive train).
But I’m not sure sure this is the right way to look at it. Everyone needs rest. Let’s imagine that A can work the standard 40 hours a week, but if they try to work more than that, they quickly become tired and unproductive. And let’s imagine that they make $20/hour (based on dividing their salary by hours worked). You might think that by putting in an hour of time, they get $20 ‘out’. But in order to put in 40 hours at their job, they need to also rest for the remaining weekly hours (128). So if their weekly salary is 40 hours x $20/hour = $800, then in order to ‘get out’ that money, they really need to put in not just their working hours, but also the 128 rest hours in between (without which they couldn’t do their working hours). So the real value of their hour is not $800/40, but $800/168, which is $4.70 — quite a bit less!
I think this perspective could be applied to other things: the production of value often requires more hidden, shadowy supports.
Consider a big company where the CEO makes millions, but the factory workers make minimum wage. From a pro-capitalist/more classical-liberal perspective, this might be fair enough: the CEO has unusual specialist skills that generate lots of value for the company, whereas the factory workers don’t. If you put a random factory worker in the CEO role they’d probably do way less well at it.
But from a more leftist/anti-capitalist perspective, this is actually unjust, because the CEO couldn’t make *any* money without the factory workers. This is why unionizing and striking works (and why progressives usually support it): you can coordinate to prove to the bosses that they really need your labour.
This feels analogous to the work hours thing: the value produced by the CEO depends on the support of the workers who actually make the product.
For another example, people who work in the formal economy are often supported in hard-to-see ways by loved ones labouring outside the formal economy. The stereotypical example is a man who works 9-to-5 (for pay) while his wife cleans, cooks, does admin, and looks after the children (for no formal pay). Feminists have talked about this a lot. It seems as if the man’s money comes from the labour he puts in; but in fact, he can work the hours he does only because his other needs are taken care of.
Another possible example: often when we think of social impact, we think of individual heroes or geniuses. But usually, such people couldn’t do what they did without the support of more ‘average’ and less famous people who took care of their basic needs, or created communities and institutions they could thrive in.
It strikes me that which lens you take is influenced by your politics: liberals, centrists and libertarians might be inclined to focus on the individuals who "actually" produce the value, whereas socialists, leftists, anarchist might be more inclined to focus on the collectives and communities that work together to enable valuable things to be produced. And surely both lenses capture some truth.
I’m not really sure how coherent this thought is or how well the examples really map. Thoughts?
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Amber Dawn
in reply to Amber Dawn • •NB I think acting as if you should always spend an hour rather than pay $4.70 when you make $800 a week, is kinda nuts. But my point is I am just confused by this concept and how to use it!
I took this post in the direction of 'suggestive analogies' because that seemed more interesting, but another direction I could have gone in is 'my complaints with the idea of trading money for time', because there are others. Like basically it depends on your disposable income rather than your hourly rate: you might end up overspending if you have a high hourly rate but also high fixed expenses already.
Ben Millwood
in reply to Amber Dawn • •Yeah I think your hourly rate should not be taken too literally as an estimate, since as you say it's not necessarily straightforwardly available to you to turn more time into more money (though for some people it probably is!)
On the other end though, it can be helpful to think "well, someone is able to get at least $20 out of an hour of my life, so maybe I should aspire to do that too". And on that story, it's a lowball: they surely pay you $20 for an hour of work because it's worth more than $20 to them, and if you're salaried then actually they pay significantly more than that when you factor in things like national insurance and other employee costs that don't actually go to the employee.
In either case I think it's most useful to give this idea to people who previously weren't comfortable with trading money for time at all, or didn't have a coherent way of thinking about it. It's useful to be able to go "is the value of this primarily in that it saves me time?" and "how much time does it save me?" and "how should I turn that into a willingness t
... show moreYeah I think your hourly rate should not be taken too literally as an estimate, since as you say it's not necessarily straightforwardly available to you to turn more time into more money (though for some people it probably is!)
On the other end though, it can be helpful to think "well, someone is able to get at least $20 out of an hour of my life, so maybe I should aspire to do that too". And on that story, it's a lowball: they surely pay you $20 for an hour of work because it's worth more than $20 to them, and if you're salaried then actually they pay significantly more than that when you factor in things like national insurance and other employee costs that don't actually go to the employee.
In either case I think it's most useful to give this idea to people who previously weren't comfortable with trading money for time at all, or didn't have a coherent way of thinking about it. It's useful to be able to go "is the value of this primarily in that it saves me time?" and "how much time does it save me?" and "how should I turn that into a willingness to pay?" -- and then the rate that people already pay you for that time is just one signal that prompts you towards a particular way of doing that, to be considered alongside other signals like "what implicit rate am I using when I make other choices in my life?"
Ben Millwood
in reply to Amber Dawn • •It's also worth pointing out that the questions of "what could I exchange for one more hour of work?" and "who should get moral credit for my ability to work one more hour?" are different questions, and arguably it's the first and not the second that you should use when deciding whether to take the bus or a cab or whatever. So, for example, the man supported by his wife may already receive enough support for him to work longer hours than he does, so while the wife is an important part of why he's able to work that much, she doesn't have to do any more work for him to work an additional hour, so he should value freeing up an extra hour without taking the cost of her work into account.
Similarly, if e.g. my commute experience is not restful, then maybe I think that all my rest supports the total time I spend commuting and working, and so I'm justified in spending up to my hourly work rate to reduce my commute.