top | item 10860517

Valuing time over money is associated with greater happiness

483 points| brahmwg | 10 years ago |researchgate.net

200 comments

order
[+] roymurdock|10 years ago|reply
I searched for the phrase "diminishing marginal returns" but could not find it in the article which seems like a bit of an omission.

This is a fundamental economic concept - the more of something you have, the less value you derive from each incremental unit.

So, based on personal preferences, once you reach a certain level of income you will start to substitute away from labor (income) towards leisure/free time (non-market activities such as hobbies, cooking, parenting, gaming, chilling).

The study data shows this pretty clearly (if I'm reading it correctly) - in Study 2b (wealthy people polled at a science museum) the median household income was $100-149k and the "% Time Oriented" was 69%. In Study 4 (online panel members who get free internet in exchange for survey participation) the median household income was $75-85k and the "% Time Oriented" was 46%.

The implied result that upper middle class folk are able to spend more time on leisure and are therefore happier on average than regular middle class folk doesn't seem too groundbreaking.

[+] danielam|10 years ago|reply
I think you meant "diminishing marginal utility". The law of diminishing marginal returns concerns employees not goods consumed.

Though not specifically relevant to your post, this "law" doesn't always hold. Some goods have a utility threshold that must be crossed before they become valuable or increase in utility (e.g., various medicines and antibiotics). Money operates similarly, i.e., its utility does not necessarily diminish, much less in monotonic fashion. Assume that if I make N dollars, I may be able to afford popcorn or I may be able to afford butter, but not both. Let's also assume that I derive little satisfaction from popcorn or butter alone. However, if I make N+1 dollars, I can afford both popcorn and butter from which I derive a great deal of satisfaction. The addition $1 has greater utility than the Nth dollar I had previously.

[+] lqdc13|10 years ago|reply
Yup.

If you look at table 3, which is a study of the museum going group, you can actually see that SWB (subjective well being) is mostly correlated with household income and material affluence. However in table 3a, we can see that SWB is negatively correlated with material striving.

In other words, people who are concentrated on making money are the people who don't have money and are also unhappy.

People who value time are the people who already have money and don't have to worry about it.

The conclusion I would make from this is that the more money, and implicitly more time freedom you have, the happier you are. If you are trying to make money but don't have any, you're not happy.

[+] dvanduzer|10 years ago|reply
It isn't at all groundbreaking, but we haven't figured out how to apply the concept to society very well. Bertrand Russell's 1932 essay on the topic has been discussed here before: https://news.ycombinator.com/item?id=6513765

What we need is an inversion of the "diminishing marginal returns" concept to permeate economic theory. Maybe some people just call that Keynesian theory?

I think the real takeaway isn't about upper middle class versus regular middle class. Rather there is quite a lot of negative value / lost opportunities by drawing the poverty line so low.

[+] hammock|10 years ago|reply
>"diminishing marginal returns"

I came to a different conclusion. The wealth of time (total man-hours or aggregated lifespans) is more evenly distributed across a population than is the wealth of money. Therefore, to the extent that happiness is influenced by comparing how well-off you are vs others, a person picked at random will be pretty damn close to the same standing as whoever is the Time-Richest Person in the World. But they are FAR less likely to be anywhere near the Money-Richest Person in the World.

[+] theseatoms|10 years ago|reply
The corresponding colloquialism is "Variety is the spice of life."
[+] EC1|10 years ago|reply
That's why I refuse to do a single minute of overtime even if it is paid. I've told employers to fire me if they feel like I should be staying longer and none of them have yet. If I ever need to make up time or do extra work, it's usually because of mismanagement and crappy deadlines as 8 hours of solid work a day is a lot, nothing should be "late".

Free time is absolutely the most valuable currency. If you can practice an instigative hobby and augment that hobby with the good money you make, then you've got it made. I have a bloody ton of hobbies and I can't wait to get out of work to work on my own stuff.

Seeing my days/life in two parts as stability (day job) being fuel for my hobby has helped me deal with my identity crisis when I got completely turned off from coding. It was also my hobby so I was always coding, but once I lost that I didn't know what to do and I hated my job. Once I saw it as fuel, no matter what day job I have, is now in context of a hobby.

[+] sjclemmy|10 years ago|reply
When I was young and fresh out of college, I earned £8000 per annum and attempted to support a non-working partner and a small child. The idea of time vs money was irrelevant. I did not have enough money to live on. I would work as much as possible to get more money, and it still wasn't enough to live on.

Fast forward to now where I have enough money not to bother about budgeting day to day and there is still enough money in my account for savings, holidays etc. whilst supporting a child (the same one!) at University and another trainer obsessed teenager.

I think there is a threshold income - up to the point of the threshold more money is required to support the life style one expects. After that threshold is reached, options open up, and WHAT YOU SPEND YOUR TIME ON becomes a big factor. Think minimum basic income.

So, time vs money is a rich persons dilemma.

Also, the idea that there is a trade off between more money and longer hours is laughable. People on low incomes work long hours and still earn very little. There is no choice. You simply must work long hours to tread water financially.

EDIT: I increased my income pretty quickly after that so I haven't suffered as much as the post suggests, but it was HARD work. The great thing about bringing up kids in your 20s is that you have a lot of energy to do all the things.

[+] throwaway7767|10 years ago|reply
Absolutely, there is a point below which people just don't have the luxury to not take any extra work they can.

There is, however, also a large group of people who could have more free time but choose to work more because they prefer to own more stuff to having more free time.

I work an 80% job (4-day work weeks) because I have reached the point where I don't really need more money. I don't consider myself rich, but with my spending patterns I don't need to worry about a daily budget anymore, and I have cash leftover to save every month. A lot of people are genuinely surprised by this decision, even though they work the same kind of job as me and therefore many of them likely have a similar financial situation.

[+] lr4444lr|10 years ago|reply
But to be fair, and this won't be a popular comment, but I'm asking honestly, why did you take on a non working partner and child fresh out of college? You evidently have great character to overcome, and I don't know the UK system, but these would be impossible burdens for most middle class Americans before the age of at least 25, and likely put long term if not permanent damping factors on their career growth to be able to get to where you are now.
[+] cLeEOGPw|10 years ago|reply
Is associated with != is caused by. It just means they go together. You will not get happier by valuing your time more than money in a same way that your car will not go faster if you put advertisement stickers all over it, because some study found an association between amount of logotype stickers and average speed of the car.
[+] wollw|10 years ago|reply

    So, time vs money is a rich persons dilemma.
It's also a monk or nun's dilemma and a motivating factor in ordination for some.
[+] seivan|10 years ago|reply
Is your job sustainable? As in will you be the first to go in a recession? Does your company make profit? Are you in a position where you're producing the value the company makes?

These things bother me as you may be paid a lot, but your company might making $250M losses every year and has no plans on turning profit.

Are you counting that your income might go away and never to return? In which case the threshold might still be too low ;-)

[+] hellofunk|10 years ago|reply
I read a report years ago that said in the U.S. the level of "happiness" increases with your income only up until an average of $60K per year, and after that, increased income had no more effect on happiness.
[+] pc86|10 years ago|reply
There have been a handful of studies about this in the US - the marginal utility of more salary => more happiness seems to slow precipitously around $70-75k USD/yr. The last one I looked at in detail seemed pretty clear that more money still made people happier, but it took more, to the point where the gain in happiness from 60-65k was similar tot he gain in happiness from ~80k-95k.
[+] thejacenxpress|10 years ago|reply
Study 1: "Students participated in exchange for the chance to win one of three prizes valued at $700."

Study 2a: "Two hundred and sixty UBC students participated in exchange for entry into a lottery or for course credit (78% female)"

Study 2b: "In Study 2b, 518 adults were recruited from a science museum in Vancouver, Canada"

Study 3a: "In Study 3a, 242 UBC students participated in exchange for course credit or candy (74% female)"

Study 3b: " we were able to recruit a very large sample of UBC students, who participated for course credit (N=2303; 76% female).

Study 4: " we recruited our sample through the GfK Knowledge Networks Survey Panel. Panel members respond to an average of two online surveys per month and receive small cash rewards and prizes for survey completion"

Make of it what you will

[+] orthoganol|10 years ago|reply
I've shunned founding startups or working at startups for the last ~3 years, and instead worked 15-20 hr/wk usually remotely.

Time is your greatest asset, personally and professionally. It's how you stay abreast of the great opportunities of our time. You need that freedom to explore things that pique your interest or move you. Founding a startup means becoming mostly blind to the other great opportunities, which is why I'm so reluctant to do a startup, unless I think it's "the one."

IMO, the opportunity cost of startup jobs is far more sinister than you think. Only do it if you need the money or if you believe you're changing the world in the greatest way you can.

[+] sanderjd|10 years ago|reply
Out of curiosity: do you do contracting / consulting work, or have you found a stable 15-20 hr/wk job? I think the latter sounds excellent, while the former sounds stressful.
[+] jerguismi|10 years ago|reply
Weird stance. Startups are not really about money. They are about greater risk.

For a startup founder it is not unusual to spend a lot of time, and still make zero money. And it is also possible to spend only couple of years, and make so much money that you can leisurely work for couple of days a month, and go surfing for the rest of the month. And do that same thing for the rest of your life.

As an employee you will surely make some money always, and only spend certain amount of time. As a freelancer/contractor typically your risk is a bit greater (you might not get good gigs or something), but as a reward you can earn more money for less time.

So it is not about whether you value your time or money. It is about your risk appetite. It is not that uncommon to do this kind of "lifestyle business" thingie where the primary goal is freedom and time, not necessarily money.

[+] jasonkester|10 years ago|reply
From where I stand, it looks like you have your numbers backward. The reason you start a startup is so that you can work those 15-20 hour weeks (or less) without anybody giving you grief about it.

Shipping software works just fine on a few hours a weeks. Maybe a quick burst up front to get v1 out the door, but then you can ramp it down as far as you want to go. I've gone entire months without opening the IDE for some of my paying products.

The problem with client work is that as soon as you stop working, the client stops sending you money. SaaS doesn't work that way. Take advantage of that!

[+] voltagex_|10 years ago|reply
Being able to work remotely and at 20-40 hours a week would change my life - seriously. I know there is lots of information around on becoming a freelancer, but do you have any particular insights?
[+] hellameta|10 years ago|reply
> which is why I'm so reluctant to do a startup, unless I think it's "the one."

IYO indeed. That you have found your way of doing things is wonderful and also incredibly lucky. That you consider opportunity cost a universally objective measure is complete fantasy though.

TL;DR: Always be highly skeptical of anyone claiming their way of life is the right way to live.

[+] dudul|10 years ago|reply
What about founding a startup to try to make big money and then have the time to explore things?
[+] jasonkester|10 years ago|reply
This approach certainly worked out well for me.

From way back in the "paying dues" phase, trading away stock options in favor of extra vacation time, and taking leaves of unpaid absence. On to my contracting days, working short gigs to maximize "bench" time and spending several months a year traveling abroad. Building SaaS products during some of that downtime and growing them in the background so that eventually they would let me step away from the day jobs entirely.

It has paid off two-fold, with both a better quality of life during the process, and a nice early "retirement", leaving lots of time to spend with the kids from here on out.

5 stars, would recommend. Don't chase money, chase free time.

[+] finstell|10 years ago|reply
Money is nothing if you have it. Money is everything if you don't have it.
[+] camelNotation|10 years ago|reply
People say that and it seems true to some extent, but financially, people rarely fall into the categories of "limitless wealth" and "not a penny to my name." It's almost like a false dichotomy is being implied by this statement, claiming that if you don't prioritize money, you will be left penniless and ruined. That simply isn't true. There are a wide range of conditions between wealth and poverty and studies like this show that you do not need to be closer to rich than poor to be happy.
[+] DarkTree|10 years ago|reply
Isn't that too cut and dry? I think what research like this is trying to determine is at what point additional money does not equate to an equal increase in happiness. If you're homeless, then yes, money becomes a huge factor in your life, because it becomes about survival. But what about the middle-class, the people who have the choice to either worry about gaining extra money for material purposes, or choose to be satisfied with a less audacious lifestyle but live more in the moment.
[+] manachar|10 years ago|reply
I wonder if this is behind the greater happiness of people with incomes over 75K per year. They actually have enough money to pay for goods and services that save them time.
[+] brianpgordon|10 years ago|reply
People might work really hard while they're young so that they can retire early and be happy and secure later. Those people would look like they value money more than their time, and probably aren't going to be very happy right now, but in 30 years they're going to be much happier than people still working full-time.
[+] taurath|10 years ago|reply
Or you'll find that all the time you put into your work has left you with little hobbies and few relationships outside of your work. You'll also have been honing only the skills necessary to succeed in the workplace, not be happy in your life. What happens is you retire and then you find you're not really good at anything else, and your body is old and creaky and you just don't have the energy to learn things as much anymore. Or, even worse, if you didn't make quite as good investments as you thought you were or there is a huge market downturn and now you have no skills or resources. It happens to a lot of people.
[+] dpark|10 years ago|reply
Depends on what people your talking about. People working wage jobs might retire early if they work really hard and save the extra. Salaried workers really don't make that much more for working themselves to death. Bonuses might be higher, promotions might be a little quicker. Or they might not. Certainly working 80 hours will not result in twice the pay for most salaried employees, not even close. Working more efficiently (and politically) is a better route for most if not all salaried employees.
[+] FreedomToCreate|10 years ago|reply
I wonder where this puts founders. We sacrifice a lot of time and money (missed vacations, family time as well as salaries) in the attempt to create something we can call our own. I always debate if it worth it, but there just this excitement associated with the unknown potential of what you are doing that keeps me going...and happy. Sometimes though I do wish I could take that family vacation, or purchase my own apartment.
[+] rdudekul|10 years ago|reply
Are people’s general orientations to prioritize time over money are associated with greater happiness?

Would you choose a higher paying career that demands longer hours versus making less money and having more free time?

From the downloaded text/pdf of the article: "thinking about money leads people to value productivity and independence, thinking about time leads people to prioritize social connections"

It looks like high quality social connections lead to happiness: http://www.ted.com/talks/robert_waldinger_what_makes_a_good_...

Dry read but great paper.

[+] wcummings|10 years ago|reply
Because valuing time more than money is a luxury afforded primarily by people with plenty of money.
[+] DrNuke|10 years ago|reply
We live an average 70-80 years on a lucky rocky, watery ball among bazillions gaseous, frozen or rocky balls into a dark void somewhat existing since a dozen billion years. Money is nothing vs living our time happily or peacefully at least.
[+] elliotec|10 years ago|reply
True, but I think a major point is that it can be much more difficult for people to live happily and peacefully when they have less money.

It's easy for us to say money is nothing vs time, but less easy for the single mom working at wal-mart 60hrs a week to feed the kids.

[+] Outdoorsman|10 years ago|reply
Happiness is that for which a trap cannot be laid...

Time is more valuable for some--book lovers, hobbyists,daydreamers, etc... Money is more valuable for others...earning it, the implied security of holding it, etc...

It seems to me, based on experience, that the route to general happiness is to eliminate as many things as possible that past experience has led you to believe won't make you happy...

A life spent in contentment, interspersed with moments of joy (or, happiness) is likely all that humans can resonably hope for...

[+] SFjulie1|10 years ago|reply
I should be very happy. Oh! I live in misery.

I have some bums I know that can testify the same: having time and no money sux.

I have written Klines of codes in a lot of language, but writing big brother software that impoverish people even if my boss gives me extra time for my life balance makes me sad.

These studies focus on biased population that don't experience poverty, nor seems to care about the others either by ignorance or by convenience (which is worse).

I am ruined, anxious, not(happy) (which is different from unhappy) ... but I still have the will to be able to help people suffering more than me... and worst of all I cannot even donate my blood, I come from Europa in Canada.

But not being happy does not mean being down. I am superficially unhappy, I will find a way to make things better for both me and people I meet.

Happyness is like rain, boring and cold. But it makes you enjoy the sun.

I am not happy and I am angry. It makes me feel as alive as when I wed with the one I love. Being told that not being happy is negative, is the same as if I was told to cut my balls because dick is so much more important.

Sorry, I like them both.

[+] jqm|10 years ago|reply
Within certain boundaries. I haven't seen very many happy unemployed homeless people.
[+] linuxhansl|10 years ago|reply
Could not agree more. I always value time over money.

I've gone even further, I calculate almost everything in time now. If can safe $100 by waiting in line or doing some other time intensive task... How much of my time is that worth?

I came to about $100/h. I.e. if I need to spend more than one hour of my spare time to safe $100, I won't do it. (Doesn't mean I make that much or whatever, just that that's how I value my spare time)

For the people who work for me if there's a weekend chore (watch a software release, off hours troubleshooting, etc), I always offer one-for-one time off and only then financial compensation.

[+] wyager|10 years ago|reply
You can't "value time over money" per se. That's like saying "value dollars over pounds". There's just a (not-necessarily-linear) marginal exchange rate between the two.
[+] logfromblammo|10 years ago|reply
I don't quite understand how "valuing time over money" is meaningful. Time and money have an exchange rate. If you want more time, you can generally forego additional money to get it, and vice versa.

Perhaps it should have stated that being happier correlates with valuing an additional minute of leisure time at a higher amount of money.

And that is as much as saying that people paid more for their work are happier, which seems almost tautological.

[+] jMyles|10 years ago|reply
> Resource Orientation Measure (ROM) Across all studies, we assessed whether individuals prioritized having more time or having more money by presenting them with a bina ry choice. To help participants imagine these trade-offs concretely and to encourag e honest responding (Fisher, 1993), we asked participants to read a short paragraph des cribing two individuals who prioritize money or who prioritize time in their daily lives. The identities of the characters and the pronouns used in the vignettes were matched to the participant’s gender (Tina/Tom and Maggie/Michael); for participants who did not repor t identifying as either male or female, the names and pronouns used in the vignettes were d isplayed as gender neutral (Madison/Taylor). The choices were presented as fol lows: Tina values her time more than her money. She is willing to sacrifice h er money to have more time. For example, Tina would rather w ork fewer hours and make less money, than work more hours and make more mone y. Maggie values her money more than her time. She is willing to sacrifice he r time to have more money. For example, Maggie would rathe r work more hours and make more money, than work fewer hours and have mor e time. We chose a binary response format for pragmatic and theoretical reasons. Practically, there is an increased awareness about the importance of conducting research with large representative samples (Open Science Col laboration, 2015). Thus, it is necessary to design short measures that minimize pa rticipant burden while maximizing reliability (Nagy, 2002). Conceptually, we chose th is response format because we were interested in assessing people’s broad preferences related to prioritizing time over money, as opposed to assessing people’s domain-specific pr eferences.

A perhaps laudable measure in order to increase study coherence, but it definitely limits the usefulness of this study in terms of making nuanced life choices.