In a
New Yorker book review essay, Elizabeth Kolbert revisits one of my favorites, "Economic Possibilities for Our Grandchildren" by John Maynard Keynes:
Keynes delivered an early version of “Economic Possibilities” as a
lecture at a boys’ school in Hampshire. He was still at work revising
and refining the essay when, in the fall of 1929, the stock market
crashed. Some might have taken this as a bad sign; Keynes was
undeterred. Though he quickly recognized the gravity of the
situation—the crash, he wrote in early 1930, had produced a “slump which
will take its place in history amongst the most acute ever
experienced”—over the long run this would prove to be just a minor
interruption in a much larger, more munificent trend. In the final
version of “Economic Possibilities,” published in 1931, Keynes urged
readers to look beyond this “temporary phase of maladjustment” and into
the rosy beyond.
According to Keynes, the nineteenth century had
unleashed such a torrent of technological innovation—“electricity,
petrol, steel, rubber, cotton, the chemical industries, automatic
machinery and the methods of mass production”—that further growth was
inevitable. The size of the global economy, he forecast, would increase
sevenfold in the following century, and this, in concert with ever
greater “technical improvements,” would usher in the fifteen-hour week.
To
Keynes, the coming age of abundance, while welcome, would pose a new
and in some ways even bigger challenge. With so little need for labor,
people would have to figure out what to do with themselves: “For the
first time since his creation man will be faced with his real, his
permanent problem—how to use his freedom from pressing economic cares,
how to occupy the leisure, which science and compound interest will have
won.”
As Kolbert notes, Keynes' predictions about growth were pretty well on-target. He wrote: "I would predict that the standard of life in progressive countries one hundred years hence will be between four and eight times as high as it is to-day." That implies an annual growth rate between 1.39% and 2.08%. According to
Maddison project data, UK real GDP per capita rose 4.37 fold between 1930 (when Keynes wrote) and 2010, which gives an annual growth rate of 1.84%.
While Keynes was correct about growth, his prediction about leisure has not come true. At least not fully - hours worked have fallen, though much more in Europe than in the US -
but even Western Europe is far short of "three hour shifts or a fifteen-hour week."
That we're still working so much calls into question how we think about work, leisure and preferences.
Among the explanations are:"conspicuous busyness" - i.e., that appearing overworked is a signal;
Paul Krugman discussed this on his blog a while back:
First of all, [
James Surowiecki is] right that for what he
calls knowledge workers — I’d just say elite workers in general — the
whole time ethos has changed. When I was growing up on Long Island,
there was a clear class hierarchy on commute times. Early trains were
filled with menial workers; the later the train the more and fancier
suits, with executives starting their day at 9:30 or 10. These days it
is if anything reversed: lots of hard-driving suits on the early trains,
much more mixed later on.
So what is this about? Surowiecki emphasizes
the incentives of employers, and their difficulty in taking the negative
effects on productivity into account. My sense, however, is that the
most important factor — which he alludes to but doesn’t put at the
center — is signaling. Working insane hours is a sign of commitment, of
willingness to sacrifice for the job; the personal destructiveness of
the practice isn’t a bug, it’s a feature.
This may be true in parenting, as well - as Kolbert writes (referring to "Overwhelmed" by Brigid Schulte):
One theory she entertains early on is that busyness has acquired social
status. The busier you are the more important you seem; thus, people
compete to be—or, at least, to appear to be—harried. A researcher she
consults at the University of North Dakota, Ann Burnett, has collected
five decades’ worth of holiday letters and found that they’ve come to
dwell less and less on the blessings of the season and more and more on
how jam-packed the previous year has been. Based on this archive,
Burnett has concluded that keeping up with the Joneses now means trying
to outschedule them. (In one recent letter, a mother boasts of
schlepping her kids to so many activities that she drives “a hundred
miles a day.”) “There’s a real ‘busier than thou’ attitude,” Burnett
says.
Another hypothesis is that people derive satisfaction and a sense of identity from work. Kolbert quotes from "
Revisiting Keynes" -
A third group of economists challenges the Keynesian presumption that
leisure is preferable to labor. Work may not set us free, but it lends
meaning to our days, and without it we’d be lost. In the view of Edward
Phelps, of Columbia University, a career provides “most, if not all, of
the attainable self-realization in modern societies.” Richard Freeman,
of Harvard, is, if possible, more emphatic. “Hard work is the only way
forward,” he writes. “There is so much to learn and produce and improve
that we should not spend more than a dribble of time living as if we
were in Eden. Grandchildren, keep trucking.”
Phelps and Freeman are correct that our standard treatment of work (bad) versus leisure (good) often misses something important. This was present in the early "romantic" Marx, who said, "man is a tool-using animal". The relevance varies a great deal, I suspect - some of us have the good fortune not to feel "alienated" from our labor, though, for many, work is the drudgery that standard economic theory assumes it to be.
A third explanation relates to the fact that "quality" is a relative concept and the desire for ever-higher quality goods keeps the consumption motive from slackening - this was
explained well by Robert Frank in an NYT column.
