Choosing to Make Less Money Is Easier Than Ever

Explore the business, economy, finance and trade aspects of human society.

Moderators: Calilasseia, ADParker

Choosing to Make Less Money Is Easier Than Ever

#1  Postby Loren Michael » Apr 20, 2013 6:32 pm

The “great stagnation” presents us with a great opportunity. It’s easier than ever to opt-out of the income-maximizing rat-race and enjoy more leisure.

If innovation has become increasingly marginal, then it’s less costly to choose to be a “threshold earner,” which Tyler Cowen defines as “someone who seeks to earn a certain amount of money and no more.” If wages go up, Cowen says, a threshold earner will choose to work less or, I would add, choose work that’s so personally fulfilling that it’s indistinguishable from leisure.

Accepting a threshold income—maybe as a journalist at a political magazine or an independent graphic artist—is easier when you know you’re not foregoing any amazing new improvements in well-being. And the vast improvements we do see today, such as access to global communications and vast amounts of information on the Internet, tend to be available for almost nothing.

As Andy Warhol said,

What’s great about this country is that America started the tradition where the richest consumers buy essentially the same things as the poorest. You can be watching TV and see Coca-Cola, and you know that the President drinks Coke, Liz Taylor drinks Coke, and just think, you can drink Coke, too. A Coke is a Coke and no amount of money can get you a better Coke than the one the bum on the corner is drinking. All the Cokes are the same and all the Cokes are good. Liz Taylor knows it, the President knows it, the bum knows it, and you know it.

The Internet and modern media make this truer than ever. The same music, sports, movies, and HBO miniseries are available to threshold earners that are available to their high-income counterparts. The only difference might be the size of the screen they watch it on. Many persons are discovering, therefore, that above a certain income threshold, there is very little they “need” to be happy...
Image
User avatar
Loren Michael
THREAD STARTER
 
Name: Loren Michael
Posts: 7411

Country: China
China (cn)
Print view this post

Ads by Google


Re: Choosing to Make Less Money Is Easier Than Ever

#2  Postby epete » Apr 24, 2013 1:26 am

I think the problem is that personal debt levels are at the highest they have ever been. So people need to work more/harder to meet their debt obligations.

From a personal anecdotal perspective, I am someone who prefers to work to live, not live to work. And as such, I would be more than happy to work a 4 day week rather than a 5 day week. But I've never had luck finding such a job, or convincing an employer to let me downgrade to 4 days a week. It's one thing for me to be happy to work less so I can live more, but if employers are constantly striving for productivity increases it's hard for them to accommodate such an approach.
High rise living is for communists and termites. - laklak
User avatar
epete
Banned Sockpuppet
 
Posts: 1539

Print view this post

Re: Choosing to Make Less Money Is Easier Than Ever

#3  Postby UtilityMonster » Apr 24, 2013 5:22 pm

I wrote an opinion piece essentially saying the same thing back in undergrad. Taking more free time and time to spend with your family is very effective at improving people's happiness. Studies are often shown that money does not make people happier. They are false if people choose to spend their money wisely. Money should be spent on working less, spending more time with family, exercising, and buying healthier food (which are often more expensive). These create a permanent increase in happiness so long as people continue investing in these activities. Most other purchases are subject to hedonic adaption, such as buying a huge house, luxury goods, Mercedes, etc.
The question is not, "Can they reason?" nor, "Can they talk?" but rather, "Can they suffer?"
User avatar
UtilityMonster
 
Posts: 1416
Age: 30
Male

Country: United States
United States (us)
Print view this post

Re: Choosing to Make Less Money Is Easier Than Ever

#4  Postby Animavore » Apr 24, 2013 5:30 pm

UtilityMonster wrote: ...and buying healthier food (which are often more expensive).


I've often found the opposite. Buying stacks of processed pizzas and frozen foods seems more expensive than buying some meat, breads, dairy and veggies for the week.

Unless you're buying into all the so-called 'health food' section of the shopping isles (often just over-priced nuts, beans and soy products) you shouldn't have a problem.
A most evolved electron.
User avatar
Animavore
 
Name: The Scribbler
Posts: 44737
Age: 42
Male

Ireland (ie)
Print view this post

Re: Choosing to Make Less Money Is Easier Than Ever

#5  Postby UtilityMonster » Apr 24, 2013 5:39 pm

Animavore wrote:
UtilityMonster wrote: ...and buying healthier food (which are often more expensive).


I've often found the opposite. Buying stacks of processed pizzas and frozen foods seems more expensive than buying some meat, breads, dairy and veggies for the week.

Unless you're buying into all the so-called 'health food' section of the shopping isles (often just over-priced nuts, beans and soy products) you shouldn't have a problem.


There is some truth to that. Healthy foods, however, require a greater investment of time into making. If you accept that time is money, then I think healthier foods are "more expensive," especially on the caloric level. Per calorie, they are more expensive, although if you eat the right amount of calories, 2,000 calories of healthy food versus 3,500 calories of garbage, it might well be the case that healthy food is cheaper. It depends partly on where you live. If you live in a wealthy area, there is more competition between stores that sell healthy food, which drives down the prices. On the other hand, if you live in the middle of nowhere and are surrounded by the lower class with their Standard American Diet (SAD), it will cost you more to procure healthy food.
The question is not, "Can they reason?" nor, "Can they talk?" but rather, "Can they suffer?"
User avatar
UtilityMonster
 
Posts: 1416
Age: 30
Male

Country: United States
United States (us)
Print view this post

Re: Choosing to Make Less Money Is Easier Than Ever

#6  Postby Animavore » Apr 24, 2013 5:47 pm

UtilityMonster wrote:
Animavore wrote:
UtilityMonster wrote: ...and buying healthier food (which are often more expensive).


I've often found the opposite. Buying stacks of processed pizzas and frozen foods seems more expensive than buying some meat, breads, dairy and veggies for the week.

Unless you're buying into all the so-called 'health food' section of the shopping isles (often just over-priced nuts, beans and soy products) you shouldn't have a problem.


There is some truth to that. Healthy foods, however, require a greater investment of time into making. If you accept that time is money, then I think healthier foods are "more expensive," especially on the caloric level. Per calorie, they are more expensive, although if you eat the right amount of calories, 2,000 calories of healthy food versus 3,500 calories of garbage, it might well be the case that healthy food is cheaper. It depends partly on where you live. If you live in a wealthy area, there is more competition between stores that sell healthy food, which drives down the prices. On the other hand, if you live in the middle of nowhere and are surrounded by the lower class with their Standard American Diet (SAD), it will cost you more to procure healthy food.


Well it depends what you mean by "healthy food". If you mean the exotic, feel-good stuff sold buy "health shops" (where they seem to actively nurture the idea that more expensive = better for you) I could see the problem. If you're talking about leafy green vegetables and locally grown fruits I don't see why it would be more expensive. At least not in Ireland. I think that rather than not being able to afford it many are just skipping over it for the quick solution. Why cook a nice meal (which will be cheaper in the long run when you consider what you get out of the food you buy this way) when you can buy something you can slap in the microwave and keep the kids happy?
A most evolved electron.
User avatar
Animavore
 
Name: The Scribbler
Posts: 44737
Age: 42
Male

Ireland (ie)
Print view this post

Re: Choosing to Make Less Money Is Easier Than Ever

#7  Postby Sonoran Lion » Apr 25, 2013 10:28 pm

Loren Michael wrote:
The Internet and modern media make this truer than ever. The same music, sports, movies, and HBO miniseries are available to threshold earners that are available to their high-income counterparts. The only difference might be the size of the screen they watch it on. Many persons are discovering, therefore, that above a certain income threshold, there is very little they “need” to be happy...


I think this fits in with the idea that there is a trade off between labor and leisure and that above a certain level of wages earned per hour of work/labor means that an increase in wages earned per hour results in the want for leisure to start to become greater than the want for labor. Before this level, an increase in wages earned per hour means an increase in the demand to spend your time at labor (working). After a certain level of wages earned per hour an increase in wages per hour means an increase in the demand for leisure time. I think at this level of wages earned per hour is where people realize that their current income is satisfactory in benefiting their lives and that an increase in wages earned per hour is no longer a strong enough incentive to increase their demand for more work hours. Instead, when you increase the wages earned per hour above this level, it means you can work less hours to maintain an amount of income you feel is satisfactory and spend more time at leisure which now gives you more benefit or utility than an extra hour of labor/working or the previous amount of hours spent working. I think the question is at what level of wages earned per hour this level would be at and what tends to affect this level. It could be that the recession is forcing people to rethink the amount of income they need to live happy or comfortable lives and whatnot.
"I would rather be a could-be if I cannot be an are,
Because a could-be is a maybe that is reaching for a star.
I would rather be a has-been than a might-have-been, by far,
For a might-have-been has never been, but a has was once an are".
User avatar
Sonoran Lion
 
Posts: 695
Age: 36

Country: USA
United States (us)
Print view this post

Ads by Google


Re: Choosing to Make Less Money Is Easier Than Ever

#8  Postby Loren Michael » Apr 27, 2013 4:45 am

I suppose I should add that I'm very much the kind of person the article I posted talked about. Most of my free time is spent biking or on my computer. I don't own a car and I don't want one. The people I rub shoulders with are largely Chinese millionaires. They use the same phone as me, they have the computer I'll be purchasing soon. They wear more expensive clothes than me, but I have a much better sense of fashion.

They work long hours each week. I work 8-20 hours a week, with 20-40% of my monthly money going into savings.

I blame the internet and globalization. Before this, I don't know that many of my hobbies would even exist, much less large chunks of my job. I know a lot of college educated baristas in America. Making the nation switch isn't for everyone, but getting one's foot in the door in developing economies is a great way to arbitrage a lot of stuff people take for granted* into a very lazy, adequately paying job.

*language, whiteness, a non-Chinese way of approaching problems, familiarity with American culture, law, etc.
Image
User avatar
Loren Michael
THREAD STARTER
 
Name: Loren Michael
Posts: 7411

Country: China
China (cn)
Print view this post


Return to Economics

Who is online

Users viewing this topic: No registered users and 2 guests