Opportunity Cost of Leisure Time: Difference between revisions
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Sleep is another example of leisure time. Many people think that sleep is a necessity and can be looked at as a valuable commondity that workers are unwilling to sacrifice. In fact studies done by Jeff Biddle and Daniel Hammermesh, two economists from Michigan State University, show that sleep many not be as much of a necessity as we think it is. A diary was kept for 706 different people between the ages of 23 and 65 to monitor their sleeping habits. 78% of the people slept on average, just under 8 hours. However, 12 percent slept over 9 hours and and 10 percent slept under 6 ½ hours. When there was an increase in wages to 25% there was a decrease in sleep by 1% and when wages were doubled, sleep time decreased by 20 minutes. This shows that sleep is sacrificed and the substitution effect takes hold. The assumption can also be made from these studies that women require their sleep more than men because on average they sleep about two minutes more than men. However, Hammermesh explains that this is not the case, when in fact women with jobs work about 5 minutes less than men, which proves that substitution effect is stronger in women, although women apparently work closer to their biological limit than men do. | Sleep is another example of leisure time. Many people think that sleep is a necessity and can be looked at as a valuable commondity that workers are unwilling to sacrifice. In fact studies done by Jeff Biddle and Daniel Hammermesh, two economists from Michigan State University, show that sleep many not be as much of a necessity as we think it is. A diary was kept for 706 different people between the ages of 23 and 65 to monitor their sleeping habits. 78% of the people slept on average, just under 8 hours. However, 12 percent slept over 9 hours and and 10 percent slept under 6 ½ hours. When there was an increase in wages to 25% there was a decrease in sleep by 1% and when wages were doubled, sleep time decreased by 20 minutes. This shows that sleep is sacrificed and the substitution effect takes hold. The assumption can also be made from these studies that women require their sleep more than men because on average they sleep about two minutes more than men. However, Hammermesh explains that this is not the case, when in fact women with jobs work about 5 minutes less than men, which proves that substitution effect is stronger in women, although women apparently work closer to their biological limit than men do. | ||
Revision as of 05:54, 4 May 2006
Page Overview | Income and Substitution Effects | Female vs Male Behavior in the Labor Market | Opportunity Cost of Leisure Time | Works Used
Opportunity Cost of Leisure Time
The opportunity cost of leisure time entails the amount of income that a laborer sacrifices while using their leisure time. Leisure time involves any activity that a laborer chooses to do while no working in order to receive more income. Leisure time can involve any activity, such as reading, watching television, or excercising. It is common sense to assume that if wages go up, then most people would be willing to sacrafice leisure time in order to get more of an income. In fact, in wealthier countries it is apparent that the income effect dominantes, in that they place less of an importance on the opportunity cost of their time and they are willing to sacrafice the chance make a higher income in order to do what they would like. Example of leisure time: If the opportunity costs of leisure increase, then women will be less likely to give birth to a baby. The time that is spent on raising a child is valuable time that women could be using in order to receive more of an income. In this case if wages are high, than the opportunity cost of leisure time outweighs the actual time spent on leisure and the birthrate will decrease.
Sleep is another example of leisure time. Many people think that sleep is a necessity and can be looked at as a valuable commondity that workers are unwilling to sacrifice. In fact studies done by Jeff Biddle and Daniel Hammermesh, two economists from Michigan State University, show that sleep many not be as much of a necessity as we think it is. A diary was kept for 706 different people between the ages of 23 and 65 to monitor their sleeping habits. 78% of the people slept on average, just under 8 hours. However, 12 percent slept over 9 hours and and 10 percent slept under 6 ½ hours. When there was an increase in wages to 25% there was a decrease in sleep by 1% and when wages were doubled, sleep time decreased by 20 minutes. This shows that sleep is sacrificed and the substitution effect takes hold. The assumption can also be made from these studies that women require their sleep more than men because on average they sleep about two minutes more than men. However, Hammermesh explains that this is not the case, when in fact women with jobs work about 5 minutes less than men, which proves that substitution effect is stronger in women, although women apparently work closer to their biological limit than men do.
