Free exchange / Nice work if you can get out
・How do you evaluate your “substitution effect” ?
・Do you think of your work as “exploit” ?
The author is talking about the change of the relationship between money and leisure by contrasting 19th century’s situation and today’s one. In the 19th century, as a British drama “Downtown abbey” showed, rich people enjoyed their leisure time almost every day while poor people worked hard and enjoyed less leisure. In today’s advanced economy however, several surveys show that overall working hours of the rich have been longer than the poor.
There are several explanations to this shift. First one is what some economists call the “substitution effect”. Higher wages makes leisure more expensive: if people take time off they give up more money. Furthermore, the “winner-takes-all” nature of modern economies may amplify the substitution effect. In the globalised market where good ideas and innovations are highly valuable, the more skilled workers could get more money.
Secondly, the author points out that the status of work and leisure in rich world has changed today so rich people tends to concentrate on their work even if they are paid enough. Work in advanced economies has become more knowledge-incentive and intellectual, whereas most jobs in 19th century were really dull ones. The writer of this column uses Veblen’s theory as an explanation. Thorstein Veblen, an American economist in 19th century argued that leisure class people who do not engaged in industry were not idle. Instead of working in industry, leisure class people engaged in what he called “exploit”: challenging and creative activities such as writhing, philanthropy and debating. The columnist states that in rich society, more people than ever can enjoy “exploit” at their office so the people can get pleasure from their work instead of leisure time in which they used to seek their satisfaction.
Lastly, the author picks up the situation of less educated workers. As low-skill and manual jobs are shrinking and as information technology are opening up a vast world of high quality and cheap home entertainment, they do not need to work as long to enjoy a reasonably satisfying leisure.
For these reasons, the columnist points out that rich people now have less leisure than the poor.