8.1.09

BE CAREFUL WHAT YOU ASK FOR. Here's another older article that I flagged for future reference. On the one hand, it could be making a case for a backward-bending supply curve of labor.
Yet we could work and spend a lot less and still live quite comfortably. By 1991 the amount of goods and services produced for each hour of labor was double what it had been in 1948. By 2006 that figure had risen another 30 percent. In other words, if as a society we made a collective decision to get by on the amount we produced and consumed seventeen years ago, we could cut back from the standard forty-hour week to 5.3 hours per day-or 2.7 hours if we were willing to return to the 1948 level. We were already the richest country on the planet in 1948 and most of the world has not yet caught up to where we were then.
On the other hand, it could be anticipating the effects of a general depression. The author, however, raises an interesting possibility. Perhaps some (many?) of the people who have closed their wallets might be, voluntarily, opting out of the consumption frenzy to take stock of the stuff they have. Should that be the case, a 10% unemployment rate need not be interpreted the same way as it was in 1981, or in 1930.

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