We live in a great neighborhood where many people decorate their homes for Christmas with fancy lights that draw people from other neighborhoods to admire them. When my daughter was a very little girl, she used to look with awe at the lights as we drove around the neighborhood, pointing to particularly beautiful displays and saying, in her eighteen-month-old voice, “more.” She wanted to see more.
I recall recently stumbling across an Oprah Winfrey Show that I found interesting. This show was about our constant drive to consume more, and tried to inspire us all to cut back a little and make due on less things. This, however, contradicts to one of our most basic assumptions as economists, where we assume that more of a good is better.
Anyone who has ever tried to diet knows that this is not necessarily true, as more of something good can actually lead to a situation that is worse. So why do economists make such a statement? One reason is that the “more is better” assumption allows us to use calculus to find where people will choose to consume. If we assume that more is better, then we can find what bundle of goods they will purchase, given their income, the prevailing prices and the options for different goods available to them.
The people on this show, however, were choosing to consume less of everything. One woman gave up a life in a “McMansion” to live in a small house in the woods with her children. She claims that she is happier, and it certainly appears that she is. Another packed away her excess clothes and shoes for a week, and rediscovered dinner with her family and a peace she had not known for years. Everywhere, people were giving up television and computer time (bad news for both Oprah and “Inside Higher Education”, I suspect) and finding that they were not missing these electronic links to the world. Indeed, it seemed that the more they gave up, the more they appreciated what they had left. One household noted that the children put up a fuss to choose only five toys to play with for a week (one little girl was taped saying “this is the worst day of my life”- to which I wanted to say “I really hope it is”), but, once the decision was made, they didn’t even play with those five they had chosen to keep.
Labor economics goes so far as to propose that some people’s “supply curves” for labor (the amount of labor they will offer in the market at different wage rates) might actually “bend backwards.” That is, at high wages, people begin to use their extra income to purchase leisure rather than more things, working less, rather than more, as the wage they can earn increases even more.
I have always thought that those of us in academics are good examples of this phenomenon. Many of us are willing to accept lower wages to work in academia, where we have more autonomy and more of a chance to spend time with students, books and ideas. While not exactly leisure, these are characteristics of a workplace that most of us value highly, and would be reluctant to give up. While I spent much of this last week’s spring break writing with my co-author, there were moments of leisure included in it, too. Perhaps it is heresy for an economist to say this, but the freedom to teach and write to my heart’s content, as well as those moments of leisure, are elements of this job that I would not trade for anything, especially more things.