It would encourage companies to hire more rather than pay overtime to existing employees.
Incentives. The company could care less about how much money YOU are saving.
Exactly. Thank you.
The “long term” is the result of the “short term”. More wealth creation NOW means more wealth later. There is ZERO reason for an economy to have idle labor resources.
My commute time is 20 hours a week. I barely have time to eat, let alone sleep.
[QUOTE=puddleglum;16857449) If you cut your work hours in half you either have to produce twice as much per hour or consume half as much. I believe that most people would be happy consuming somewhat less, but cutting everyone’s living standards in half would make most people miserable…[/QUOTE]
With a 32 hour workweek (or 20, as you mentioned) employers are still free to pay overtime. There’s nothing saying that the economy as a whole would produce less stuff.
smaller buildings/facilities, less parking spaces.
I agree. I’m currently working through my two weeks notice without another job lined up. I like having a regular paycheck, I just hate working so many hours that I am a pissed off miserable asshole to everyone all the time. Is my life an impediment to my job, or is my job an impediment to my life? The money will work out, I’ll get another job soon enough, and even if they don’t treat me better I’m sure they won’t treat me worse. I need to keep my own priorities in order.
I was having a bad day when I posted that. The other thing was discovering that I’m the only person left on the ‘early rota’ (so it’s not actually a rota), and I’m not allowed to leave the workplace before the normal time to keep my hours down to a sane level.
And yet you are purposely stacking the deck against the second option. IOW, lots of people would earn less money. I doubt that’s a desired outcome for most people. No?
Based on their observed actions, I would guess it is a desired outcome for a large percentage of people. For example, it appears (from simple observation) that a lot of people choose to live and work in parts of the United States where wages are lower and the cost of living is lower. Also, a lot of people do not work second jobs even though they have the time to do it.
Why wouldn’t the carpenter double his rates? When the money supply doubles, everybodies prices go up. It is going to cost the carpenter twice as much wood for wood and nails. It is going to cost him twice as much to put gas in his truck. Cost him twice as much to feed his family. The adjustment will not be instantaneous but doubling the money supply will only double the prices after a painful period of adjustment. Just because 2-3% inflation is good does not make 100% inflation great.
Money only works as a store of value if the value is relatively constant over time.
Think of a desert island with three villages, one next to a banana tree forest, one by a fishing harbor, and one by a coconut forest. They trade using gold coins left behind by some pirate. There is enough production for everyone on the island to have one banana, one fish, and one coconut a day. If suddenly someone found another chest of gold coins, how many bananas, fish, and coconuts would be consumed after the discovery? The answer is obviously one fish, one banana, and one coconut per person. In order to consume more they would have to find a way to get more fish, more bananas, or more coconuts.
It is the same for our economy, during down periods it is good for a little inflation to occur for reasons having to do with credit cycles and the velocity of money, but ultimately unless more is produced, more can not be consumed.
That’s not the same thing.
Neither is that.
Not the same thing as what?
Are you simply stating that all things being equal, people prefer more money to less?
I don’t think it’s that obvious, since the discovery of the additional gold coins would shake peoples’ confidence in their currency. People would worry that there are even more coins out there, either undiscovered or being hoarded by a clever villager waiting for the opportunity to buy up production of some scarce asset. There’s a decent chance that people would start insisting on payment in kind for goods. Which may have a tendency to favor one kind of production over another, for example coconuts over fish since coconuts are easier to preserve.
So a discovery of additional coins might very well affect the production (and therefore consumption) of bananas, fish, and coconuts even in the idealized, simplified world you have constructed.
I was not try to argue that it would have no effects or that monetary changes have no effect. Just that you can not raise consumption in perpetuity using only monetary policy. As you point out most of the changes in the hypothetical would be destructive and likely cause standards of living to dip at least temporarily. In order to raise consumption long term, you need to raise productivity long term. Monetary policy can help smooth disruptions in the credit cycle and can help ease unemployment during recessions. Both of these things can affect productivity, but only up to a point.
The OP is arguing that people can cut hours worked in half without affecting consumption materially. His way to achieve this seems to be either magic or monetary policy. If the good Lord himself was running monetary policy cutting hours in half without doubling productivity will necessarily cause consumption to plummet. Since the people in charge of monetary policy are fallible and completely inexperienced with an economy where suddenly hours have been cut in half, monetary policy will likely be more of a drag on the economy than a boon in that scenario.
Yes you were. Don’t weasel.
That may very well be true. So what?
As I asked you before, do you agree that BAD monetary policy can produce a poorer society in the long run?
If that’s what he is arguing, then of course he is wrong – at least in the short run. Would you mind quoting him where he argues that so I can see what exactly you are disputing? I looked and could not find it.
I was only saying that it had no effect on the maximum amount of consumption possible, the other effects I did not feel were germane.
WiSteve argued upthread that it would be possible to increase consumption through a multiplier effect caused by what would happen if “Ben Bernanke printed up a couple thousand and gave it to me”
It is very easy to make an economy more or less permanently worse through bad monetary policy. No dispute there.
In post number 4 the OP states that what he wants is to cut hours in half, cut compensation less than half, and then have universal health care plus a government stipend make up most of the difference. In the short, medium, and long runs that is impossible.
My company tried something like this. For many people, you did not get an office, but rather reserved one for a two week period. You had your stuff on a cart which you locked in a locker between moves. They also had drop in offices, so that if you lived far away, you could drop in to a local office, work for a while, then come in after rush hour. They also encourage work from home, and people having to move away from the office because of an SO move could stay working. We had a computer system that really worked well using this model. If you were on vacation, you had no office leading to the savings you mention.
I never was subject to it, but those who were really didn’t like it all that much. It was hard to figure out where your colleagues were. Face to face meetings really declined - I was on many calls where no two people were in the same place. I even ran an internal conference where a vast majority of people called in and watched the presentations on the web.
No one was sorry to see it go.
That’s just not true. Here’s what you said:
Stop weaseling and admit that you were wrong.
There’s nothing in Post 4 where the OP says that consumption would not be affected.
Ok, so the extent monetary policy is sub-optimal, it is in fact possible to increase production long term by changing monetary policy.