Varied views of work, fun are an economic benefit

While I had a laundry list of small and large earthmoving projects to accomplish on our farm, the real reason I was renting a bulldozer, I explained to the sales rep at the Komatsu dealer in Sioux Falls, was because I wanted a vacation from teaching and writing, particularly since the fall semester starts in three weeks.

“That’s gotta be good for the soul,” he said. It turned out his wife teaches at one of South Dakota’s state colleges, so he knew exactly how professors need to get away their work for a while. So do most other people, even though few have the flexibility of academics.

The line between work and play is not always clear. For someone who operates earthmoving machinery for a living, sitting by a lake with a fishing rod or a good book may be a balm for the mind and soul. For someone who reads 50 hours or so a week as part of their job, a few 14-hour days leveling old railroad grades and abandoned gravel pits is just the ticket.

The farmers who did much physical toil when I was growing up in the 1950s enjoyed a few days doing nothing at some relative’s house. Their offspring stagger bearing canoes and 60-lb Duluth packs over muddy, rocky portages in the Boundary Waters.

What constitutes work and play differs not just between generations, but also between individuals in any one generation. Some people like driving bulldozers for a living, others writing computer code and still others teaching college economics.

This heterogeneity of preferences regarding the desirability of different types of work and the line between work and play is important economically. It facilitates the division of labor that Adam Smith first described as key to productivity. It also ensures that there is someone, somewhere who is willing to do any job that society needs done.

Economists term the satisfaction from consuming goods and services or working or playing as “utility,” a term first used by 19th century British philosopher Jeremy Bentham. Much economic theory is built on the assumption that human beings “maximize utility.” That is, they make choices about using the resources they have available so as to satisfy as many of their needs and wants as possible.

To the extent that earning money allows people to buy goods and services that satisfy needs or wants, humans thus also “maximize income.” But this is subject to an enormous “all other things being equal” qualification.

If people can choose between two different jobs doing exactly the same thing under the same conditions, and one pays $10,000 more than the other, they usually take the higher paying job.

But conditions vary and the non-pay characteristics of different occupations or employers are of enormous importance in people’s choices about how they earn a living. Economists know this is true, but such non-monetary considerations are idiosyncratic and nearly impossible to include in general theories about human economic behavior. In some cases, the “all other things equal” fudge is harmless, but in others it causes erroneous predictions. Perhaps the next generation of economists will find a solution.

In the meantime, I have more abandoned railroad grade to level.

© 2009 Edward Lotterman
Chanarambie Consulting, Inc.