The Value of Pleasure

A number of sources have suggested the use of a person’s wage, either directly or indirectly, as a basis for estimating the value they place on leisure time.   It’s an interesting notion, but I have the sense that it is not entirely accurate and perhaps not as meaningful as it seems at first glance.

The basic idea is this:  if a person earns 15 dollars per hour (25 cents per minute) then they should seek to balance or maximize their consumption against their production by evaluating the cost of leisure activities against their earnings over the same period of time.   And so, if they engage in an activity they enjoy for two hours, they should pay no more than $30 for that enjoyment.

I could niggle the equation a bit, because time is spent in leisure as well as money, so in addition to the $30 they pay, they are also giving up two hours of time that could have been spent productively, which has a value of $30 – so in effect they are spending $60 rather than $30 in terms of actual and opportunity costs.   So the total cost of the activity, loaded for time as well as expenses, should be considered rather than just the money cost.

But what most concerns me is that this practice considers time to be commoditized.   It’s well understood that a person seeks a higher wage for unpleasant work: he may accept $15 an hour for something that is mildly boring and annoying, but to engage in something he finds to be onerous or distasteful he would demand a higher wage to compensate him for the greater displeasure.

Likewise in our spending choices we are often faced with alternatives that carry a premium because they are more pleasant.   People routinely pay double or more the price of the cheapest option available in order to gain greater pleasure from the experience of consumption: they will pay $5 for a cup of premium coffee when an equal amount of “regular” coffee is available for $1 – and when water (which is really what is needed to sustain life with no pleasure) is essentially free.

And so, the proposal that the value of leisure should be considered in proportion to the value of production seems flawed.   It would lead to the conclusion that a person who earns $15/hour should seek to enjoy a $2 cup of coffee whereas another who earns $30/hour should be willing to pay $4 for the same product.   But what if the person who earns less enjoys coffee more?   It simply doesn’t make sense that he should forego the enjoyment he takes of a premium product simply because of his income.

This seems to be attention to the metric without attention to what is being measured.   To ask "what is a minute worth?" is essentially like asking "what is a pound worth?" and refusing even to consider "a pound of what?"   Some things are more desirable than others and command a higher price - and this is as true of human experience as it is of any product (which, of course, is merely a means to achieve an experience).

All in all, this reeks of an accounting mindset, where things that ought not to be monetized are reduced to dollars and cents and their functional qualities completely ignored for the sake of balancing an equation in a manner that is mindless of anything but the arithmetic.