05-26-2006

Economics of Leisure

A recent New York Times article on the founder of the Geek Squad computer repair service includes some interesting information about the economics of leisure time:

The results from two online calculators that determine what your time is worth may surprise you. Try http://hughchou.org/calc/realwage.php or http://moneycentral.msn.com/…. First, your hourly rate may be lower than you think. For instance, someone making $70,000 a year, but who puts in 50 hours a week and commutes an hour each way, may discover the hourly rate is not $33, but about half that.

So does that mean you hire a handyman only when he costs less than $16 an hour? It’s more complicated than that. With only about 12 hours of true leisure time a day, each precious hour is bought with more than 5 hours of work. According to the calculator, each hour of spare time would then be worth about $85.

The idea ties in with a very enlightening presentation Daniel Gilbert gave at SXSW on How to Do Precisely the Right Thing at All Possible Times. He explains why many decisions are not as cut-and-dried as they appear. A podcast of Gilbert’s presentation is available, along with many others on the SXSW site.

I haven’t yet read Gilbert’s book, Stumbling on Happiness, but it has been getting some good reviews. It’s definitely on my list to read soon.

Posted by Matt in business, lifehacks, money, tech | RSS 2.0

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