The price of time
I’m talking to myself but you can join the conversation. It goes like this…
How much is your time worth? Ten dollars per hour? Fifty dollars per hour? Thousand dollars per hour? If you pick a number that you like, can you use it to justify your spending habits, to justify buying expensive clothes and car?
How much is your time worth? When you wake up with a hangover, is your time worth as much as when you’ve slept well and drank a coffee? If the economy crashes tomorrow, would your time still be worth as much?
How much is your time worth? If you need a million dollars, can you sell enough time to get them? Conversely, you have a million dollars to spend, how much time can you buy?
… these are not easy questions, and yet I’ll discuss them.
The economics of Time are different than the economics of Money. Time is heterogeneous and scarce, as contrasted to money which are a commodity. Money and Time also have different decay rates over the years.
First, all time is not made the same. Not all time has the same usefulness, even for the same person, while all money has the same usefulness. When I go to a restaurant and need to pay, it doesn’t matter which twenty dollar bill I use. They are all the same. But it does matter which hour of the day I use for my work, for my exercise, and for my relationships. When I wake up in the morning, I am neither adequate, nor focused. I can only achieve some basic tasks. On the other hand, after I’ve been awake for a couple hours, and gotten some basic movement, and groomed myself, I feel more powerful. This is my prime time. My mind is working at full speed, my body is comfortable, quick and agile, my dexterity is higher and I make fewer mistakes.
Society values our prime time, and pays for it by hiring us to do jobs. Society doesn’t care about our sleeping and relaxing time. This time results in no benefit for society. When we do our job, and get paid, we get money. Money don’t feed us and don’t provide shelter or warmth. But the society produces food and house and heat, which we can buy for money. Money is society contract, and is all the same. Its only characteristic is quantity.
Time is personal. In each hour of ours, we have different abilities, and different desires. We might desire to sleep, to shower, to eat, to be warm, to watch the sunset, to walk around, to be creative, or even to do nothing. It is up to us to set our own value systems. Each of us values time in different ways. Some care about having a relaxing morning, others about relaxing evening. Some want to solve problems, others want to create art, others want to their body to enjoy hedonistic pleasures.
Society adapts to our desires, and provides the things we value, for money. It is up to us to evaluate whether it is worth it for us to give away some of our time, to get money, in order to fulfill our other time.
Every person gets the same amount of time per day, yet some people have orders of magnitude more money than others. If some people were to be able to speed up their existence, by making their brain run faster and body move faster, then from their perspective they would have more than 24 hours in a day. But I’m not aware of anyone who has been able to do so yet. Relativity theory and the twins paradox says that it is possible to slow time if you travel close to the speed of light. But since that almost never happens, and even the fastest moving humans - the ones in the International Space Station - do not experience noticeable delay, I think it is fair to say that we all get twenty four hours on the day.
Scarcity of time creates skewed exchange rate between money and time. Time can be exchanged for money at an unbound rate. As long as there is anyone willing to pay the money on the other side, I could be making a million dollars per hour. Yet, at best, money can free its owner from time obligations, giving them twenty four hours on the day to spend. Money can also augment these twenty four hours to a certain degree, making them better. But no matter how good money makes these hours, it won’t make them more than twenty four per day.
Just like present money are worth more than future money with the same nomination, present time is more valuable that future time with the same duration. But while money’s decay rate is due to inflation, time’s decay rate is personal, and it depends our health and condition as we develop, age, and die.
We prefer to have a good time this year, than to have it next year, because by waiting until the new year we may change our preference about what good time means, or we might not be able to get good time in the same way, or we might die.
During our turbulent years, in college, and soon after that, our lives can change a lot just in a single year. Our outlook of the world may change we may develop taste for new things. And we won’t even know which those things are. During those years, the personal value of time decays a lot. The high decay rate of time causes massive preference for the present over the future. This causes us to do seek more pleasure and make more drastic decisions. New relationships, new jobs, new hobbies and interests.
Later on, people tend to settle down as they create families. They don’t expect much change year to year, which causes a relatively lower decay rate for time. I actually don’t know if this is true, as I haven’t fully reached that point in life yet. But lets assume I am right. These years cause next year to be worth almost as much as the current year. As a result, decisions in this period would be focusing more on the longer term, and people would be more ready to delay their pleasure for later. It is even possible for a negative decay rate to occur, as people might expect a next year to be better when they have fewer obligations.
I’m not going to presume to have any idea about how people think about their time after that age.
I don’t know what’s an optimal strategy for spending time. It is likely that such strategy doesn’t exist, as everybody has different time preferences.
I think that for me, it is important to determine better the things which make my time better. I might have an idea about what I like to do, but I am still exploring.