"Why hasn't economic progress lowered work hours more?" Tyler Cowen, Hayek Lecture Series

This is Duke University. This afternoon, Professor Cowen will talk on why hasn't economic growth lowered working hours more? Please join me in providing him with a warm welcome. Thank you. Thank you. I wanted to do 3 things in this paper. I wanted to write a work of science fiction. What our future will be like. I wanted to write a work of philosophy in some way, an essay on philosophy, what is really good to pursue in life. And I wanted to write an economics paper all at the same time. And the proximate origins here is I was invited to write for a conference which Johnny Anomaly also was invited to write for, and the key question of the conference is something like, is progress real or is progress an illusion? So we think the world's getting so much better and we're all so much richer and we have these nice gadgets and so many things feel like fun, but are we actually better off in some meaningful way? That's both a question of economics and philosophy, and the science fiction is gonna come in because if you have some partial answer to this question, it will imply predictions about what the future will be like. So, uh, I'm gonna tell you later my predictions for the future. But first, I wanna go through, uh, the basic puzzle here. And I'm starting with the famous essay by John Maynard Keynes, one of the, uh, best and most famous economists of all time. And Keynes himself wrote an essay in 1930 And he said, uh, barring a major war— actually, we had a major war, but we caught up, so that didn't matter for growth— but barring a major war, by the time we get to the year 2030, people will hardly be working. Maybe there will be a work week of about 15 hours a week, and we will all waltz around and enjoy lots of leisure. I think Keynes had a mental image of something a bit like his life at Cambridge. That you would consume the arts, you would debate with Nicholas Calder, you would have a lot of sex, you would go, like, punting on the river, maybe drink some beer, marry a ballerina, whatever else might be in that sequence. And every now and then you'd have to show up and give a talk somewhere about the meaning of progress. But that basically we would all have these charmed lives. And if you think of this in historical context, Well, at the time Keynes wrote in 1930, median household income in Great Britain— I've tried to look for various measures— best I can tell, it was about $12,000 or $13,000 a year, which by modern standards is of course pretty poor. That would be well below the poverty line. Today in the United States, median income is $49,000 to $50,000 a year, adjusting for inflation. Constant dollars. So Keynes, I think, had the vision, well, if people had like 4 times more than what they had back then, there were only so many things you could buy. What was really fun in life was contemplation, reflection, the arts. A lot of that, if not free, was somewhat free. You could read philosophy, have a kind of Greek life, and that was his prediction for the future. So what I'm gonna do in this paper is look at the data and ask, to what extent has this prediction come true? And mostly not, though in some ways, for some groups of people, it has come true. And then ask, why hasn't it come true? And then if you have an answer to that, like what's happening, why is it happening, I'm gonna pull out that science fiction element, uh, what's the future gonna be like? And also, this will help us reflect on a question. Who is it really that is benefiting from modernity? Who's getting most of the gains from that progress? And which group of people are getting a relatively small share of those gains? So those are here my motivating questions. Anyway, this is Keynes pictured in this slide. So, uh, obviously the big change between now and then is a higher standard of living driven by automation. Machines help us produce much more. And the vision— not only did Keynes have this, but if you read H.G. Wells' The Time Machine, much earlier work of science fiction, there's again a vision that machines will, at least for some people, make labor not so necessary. So that was the theory. Now I'm going to apply a little economics to this point. This is a messy picture. If you're an economist, you'll know it. If you're not an economist, don't worry. It's simple intuition. There's a substitution effect and an income effect. The income effect says, as you accumulate more wealth, as you're paid more, more of your needs are satisfied, and at some point you feel you can take it easy. So let's say someone were to pay me for a lecture a billion dollars an hour. How many lectures would I give? Well, for sure I'd give one, two, three. I'm quite sure I'd give 10, but at some point I'll feel, "Well, this is enough money, I can stop giving lectures. I'm gonna run off and spend all these billions." So at some point the income effect becomes quite strong. But of course no one offers a billion dollars for a lecture, But still, if you earn more money, at some margin, some people, because they have a lot, they work less. That's the income effect. The substitution effect has the opposite implication. The substitution effect says, as you're paid more per lecture, you have a tendency to give more lectures, right? So if you're paid $1 million a lecture, uh, I think I'd give an awful lot of lectures at $1 million a lecture. And I wouldn't stop anytime soon. There, the substitution effect would be strong. Pay me more, I work more. One thing which I find really striking about the data today is, as far as I know, for the first time in history, the wealthiest people use their opportunities in this country to work more and not work less. So Keynes's aristocracy, if they had a certain amount of land or regular income from wherever, they would cut back and work less and be one of those British aristocrats in those novels you read. But today's, say, top 1%, which you hear so much about, what do they do with their leisure time? They work in it. So for today's top 1%, the substitution effect is stronger than the income effect. But let's look at people in general. So just to ask the question, are we working less? Well, in the 19th century, In either the US or the UK, a typical laborer would work— that should be a year, not a week— 2,800 to 3,300 hours a year. Just to make that concrete, more intelligible, that's like 6 days a week, 10 hours a day. Which is a little tough, right? I know you all do that at Duke. And maybe in law school, but that's a pretty tough life. And keep in mind, back then jobs are much harder than the jobs we're used to. Probably you work on a farm, you never went to high school, certainly didn't finish high school, you're lifting a lot of things, working really hard at a physical— some form of physical labor. More recently, typically it would be 1,400 to 2,000 hours, again that should read a year, and that's like 40 hours a week, which is a pretty typical work week. Germany, France, it's a bit less, I'll get back to that. But that's a big difference in terms of work hours, and I think it's fair to say across that margin, the 19th century to today, the income effect has been stronger than the substitution effect. We're a lot richer and we work less. Right, so far, so good. Another way to look at this if you wanna stick in today's world, Rich versus poor countries. Rich countries, you know, OECD minus Mexico, typically per person we're seeing work of about 19 hours a week. This is including, say, people who are not working. It's not per person who is working, it's per person. In poorer countries, the average is 29.3 hours a week. So poorer places working more. United States, Japan, Belgium, they're wealthier, people work somewhat less. Compared to the emerging economies. Again, that's showing movement in Keynes's direction. As we get richer, we're working less. So, so far so good. Across these gross distant margins of comparison, Keynes seems to be right. But here's the funny thing. When you look at the United States and a lot of other countries more recently, Keynes doesn't seem to be right anymore. So here's some numbers. This is for United States, and yes, I will consider other countries. But work hours per person really haven't fallen in a long time. They've actually gone up. So in 1950, per person, 22.34 on average. It then goes down a little. 1970, goes down a little more, though not that much. 1980, it's back up again. 1990, it's back up a lot. My goodness. '80s were a time of work. Keynes, you know, had he been alive, he would have been very worried in the '80s. What's going on here? But the '80s was a pretty good decade economically speaking. Uh, 2000, it's up even a bit more. Uh, there's not a number computed for 2010 that I have, but that would be distorted by the high extent of unemployment then. So I don't think it would— fit the rest of the series. But you look at these numbers and it's like, my goodness, America from 1950 to 2000 got a lot richer. That's not in dispute. And per person, instead of working less, we've worked more. So it seems like Keynes actually isn't right anymore. Now there are some more tricks. I don't want you to just stop with that as the conclusion. But it seems across these years If anything, the substitution effect has been stronger than the income effect. Higher wages, people working more. Uh, one thing we do see is big differences across groups. And this will help us resolve at least some parts of the puzzle. So who is cut back on working? There are 3 main groups. So in part what's happened is a change in the distribution of working hours, uh, groups that wanted to work more now have the chance to work more, and some other groups have cut back on working. So who has cut back? Prime-age working men now work considerably less than they used to. So people like me. Uh, males between the age of when they enter the workforce to the time they retire that group of individuals works less. So it used to be a few decades ago about 7% of that group was neither working nor looking for work. This is in normal times, not during a depression or recession. Uh, today that same number is at 12%. Uh, so prime age males, they're not living Keynes's dream. But they're slacking at the margin. The people who are living Keynes's dream actually are the elderly. So one way to think about Keynes is that Keynes was completely right about older people and wrong about most others. So if you go to 1880, males above age 65, 75% of them worked. It's one reason why there was no Social Security back then— not enough wealth for it But also you would work until you died, and quite commonly you would die at work, 'cause your job was hard or dangerous. Imagine having a job of physical labor, a lot of disabilities, and most people still out there doing it at age 68, 69, whatever. That was the world back then. Today, males above age 65, only about 20% of them are working. So Keynes was right. Mostly about the elderly. The elderly, for the most part, they have enough wealth plus government benefits plus support from family, friends, whatever, that a big, big chunk of them really don't work. A bunch of those who do work actually work Keynes's proverbial 15 hours a week. "Oh, I'll just, you know, do the checkout at Walmart. I could use the extra dollars. Besides, I enjoy working with people." keeps me on my feet, keeps me a little sharp. And they might do it 15, 20 hours a week. And then they go home, I'm not sure they study Cantabridgian philosophy of G.E. Moore, maybe they just watch TV, but maybe that's more fun, right? So, what's interesting about Keynes and us is that when we consume leisure, we choose to bunch it. So much temporally. This is a very odd assumption about economic preferences. I don't think it's well understood. But we choose to consume the bulk of our leisure when we're pretty old. And that Keynes had not expected, maybe had not even thought about. He doesn't mention it in the essay. And again, if you just write down a normal utility function, like with the summation, uh, and solve for first-order conditions with a rate of time preference, This in no way will come out of those equations, this extreme bunching. Like, let's say I told you, uh, well, take people. When are they going to eat their apples? Well, they're going to eat all their apples after age 65. That's not intuitive. You know, maybe for some goods it's intuitive. Like, when will people wear their eyeglasses? Well, mostly in old age, right? That's obvious. Because fewer people can see well. But just some— no, when will people ride their snowmobiles? When will people read books? When will people actually want to really educate themselves? Those were the older people. It's interesting, there's this group attached to George Mason, it's called like Lifelong Learning Institute. They're older people. You show up, you lecture for them, they're awesome. They listen, they're totally involved, they ask questions, and you think, hmm, I wish my class were like this, right? And they're all over 65. So that's again this strange kind of bunching. Another group of people who are living Keynes's dream more than used to be the case, and that's teenagers, like ages 16 to 19. Like 3-year-olds, they've always had Keynes's dream, right? They don't— they didn't work then, they don't work now. But say when I was growing up, I had jobs the whole time. No one thought this was weird. It was Pretty much expected. And my family wasn't poor. I didn't have to work to, like, help my dad put bread on the table. But of course I worked. It was good for me. And I had fun. When I was a teenager, 55% of my peers had some kind of job. Not full-time, we had to go to school, usually, some of us. But it was kind of like the Keynesian, you know, 15-20 hours a week. I wrapped produce in a supermarket. How many hours a week did I work? My median was 15, just like Keynes said. I didn't know it at the time. I was living Keynes's dream. But now instead of 55%, it's 35%. So teenagers are working much less. It's a little tricky because they may be working in different ways. Like we also know from data, teenagers are given more homework than when I went to high school, much more. So I don't know if it's right to say they're working less or doing a different kind of work, or they're doing more unpaid work, or is that homework like the old Cantabridgian leisure? Like you read Hamlet instead of G.E. Moore, does that count for Keynes? I don't know. But at least teenagers, there's some possibility that they have easier lives than they used to along some dimensions. What group is working more? I mean, that's super, super obvious. It's women. And if you look at women, even within that category of women, there's a big gap in terms of the change. Women with a child younger than age 6 in 1950 hardly ever worked, and now these days they work really at pretty high rates. That group has seen by far the biggest change. So in a sense, what our economy has done, maybe it's a kind of Kosean solution. We've kept like total hours per person roughly the same or up them a little bit, but we've reallocated them, taken away from the old most of all, the teenagers a bit, the men somewhat, not the high-earning men but lower-earning men, and given a lot more work to women. Sort of an interesting set of trade-offs. Anyway, let me continue with the picture. Who's working more? Women. That's quite obvious. Even with women, there are some tricks when you think, like, what do we mean by work? And we need also to consider household production. So clearly women work more measured hours for which they are paid. But doing things at home is much more efficient. Rather than cooking for 3 hours, you can use a microwave. You can order ready-made foods from restaurants. Washing machines are better. Pretty much everything in the house works a lot better than it used to, say, since 1930 when Keynes wrote. So women are working more. They're almost certainly not working as much more as the published work hours indicate. Uh, so to some extent, women have substituted away from work in the home, 'cause there their relative marginal product is lower. And work in the workplace, their relative wage is higher. This is again a substitution effect. For one reason, there's less discrimination, but also birth control makes it easier for women to work, choose, and pursue careers. But let me just note, there's a kind of invisible third sector here, household production. Now let me just talk a bit, like, about the last 10, 15 years, because there we've seen a kind of funny change. So most of the trends since 1950 are more people working and working more, except for the elderly. But very recently there's a decline— LFPR, that's Labor Force Participation Rate— that has been declining for a while. That's not hours per person, but that's number of people who are either working or looking for work. And you might think, oh, well, that's declining. We're getting to some version of Keynes's vision. After all these decades, finally it's coming. But not in my view. This, in my view, is not the income effect. Some of it is just more of us are aging into retirement, and thus where fewer of us are working for natural reasons. And some of it is the substitution effect. So here's a graph of wages. Since the year 2000. And by the way, this graph should terrify most of you. This is for 4-year college grads, which, uh, those of you who are not faculty, uh, already are or aspire to be. And the starting wage there in year 2000, which is now a long time ago, right, uh, was higher than it is today. Median wage in the US since 2000, it's down by about 5 to 6%. It's not total wages, it's not average wages. Wages for high earners are way up, but for the typical household earner, 4-year college grad, actually payments are down. So we're in this new funny world. I hope it's temporary, but yes, there's less work in some ways, but there's also less pay. It's not Keynes's vision. But anyway, if you get more leisure because pay is lower, we've seen some of that lately.. But Keynes' story was more leisure because we're richer. So, you know, this pattern I think no one really had predicted. If you had told people there'll be no nuclear war, no asteroid crash, communism will fall, we'll move to close to free trade, no major catastrophic event, and what's gonna happen to wages? Milton Friedman, Paul Samuelson, They all would have argued, would they go up 2% a year, 3% a year? Here's an even more stunning way to put it. If you look at males alone, like those poor rotten males, in 1969 the measured inflation-adjusted median real wage was higher for males in 1969 than it is today. Now there are tricks there. When you have medians, there are composition effects. I think how we calculate inflation across spans as long as 1969 to today is not very accurate. So I don't actually think the actual real wage for the median male, held constant, has fallen. But the fact that it's even possible to show up as such in the numbers shows you something pretty funny has been going on. I'm gonna get back to this idea I mentioned this before, but, you know, who are the groups working more? Well, the top 1%, they're really ruled by the substitution effect. There's a very good paper by Erik Hurst. The people who are working less are the low-wage males, and the people who are working more, a lot more, are the high-wage males. So people in lucrative professions, whether you can say they're expected to work more, they want to work more, some combination of the two, but they're doing it And since these people are at times called masters of the universe, I don't think you can tell some story about how they're enslaved by oppressive corporations and they need to organize a union of like the adjunct legal partners or doctors or investment bankers. You know, it must be they want to work those hours, right? Because the poorer people who have way less like power, influence, whatever you want to call it, they're working less. But the well-off people They're just going crazy working more. So it's interesting to see that the people who in some sense, the quote-unquote "masters of the universe," people with the most choices, most opportunities, are working more and more and more. So one of the conclusions I'm going to edge toward, if you look at their behavior and you look at women, including women with children under the age of 6, People seem to like work more than we— certainly more than Keynes had thought. I think one of the big lessons in economic data is people really like work. There's another group of studies. There's a recent study of lottery winners. This is now from Sweden, not the US, but the best data set is about lottery winners in Sweden. Now, some of these are big, small prizes, but across the board, when these Swedes win the lottery, they hardly work less. They keep on going to work. So their non-lottery earnings fall by about 1% of the amount of wealth which they win. And that to me is striking. It's again more evidence people like work. These people could work less. If you ask, like, what country on earth has the kind of flexible labor markets where you can cut back to shorter weeks. Like Sweden might be number one along that dimension. They're famously flexible. Lots of childcare, flexibility for women, high rate of women in corporations, pretty low rate of discrimination, lot of government encouragement to have flexible workforce practices. And these lottery winners, they keep on at it because Swedes too love work. And now we're getting a bit back to Keynes. The Keynesian prediction would have to be, well, if you win the lottery, you'll at least cut back or maybe quit. In the data, we don't see it. There are some American papers with far inferior data. It's harder to draw conclusions from them, but actually their measurements are exactly the same. When people win the lottery, for the most part, they don't cut back on their work. You know, one way to view this is not that work is so great, but maybe life is pretty horrible and stressful. Is it that work is always splendid, or like your personal relationships, dealing with your children, or having to watch your parents, or negotiate, you know, your friendly relations? Maybe that's a lot less fun than we claim. There's some independent evidence. I find it intriguing. Tyler Cowen, that when people go on vacation, on average they have less fun. It's sort of crazy, like why would they have less fun on vacation? I suspect, and again this is now just my subjective opinion, you have to deal a lot with other people on vacation, you have to make common decisions, there's a lot of stress, stress goes up on vacations. Why people take them is an interesting question. A lot of my vacations are a lot of fun actually, I can promise you. But vacations are not as fun as you think. Another issue I've puzzled about, uh, I don't know of really good data on it, they're probably somewhere, it's just not something an economist would know. But you could ask the corollary question, why don't people have sex more? So how many hours a week do people typically have sex? Again, I don't know the number. But I know it's not that high. And sex is supposed to be like the most fun thing. Now it could be, oh, it's a matching problem, but look, there's Tinder if you need it, there's Uber, you can like do Uber and Tinder if you need to get somewhere to your Tinder and then back. Cheap alcohol, there's Match.com, believe it or not there's marriage. You're supposed to have like zero cosean transactions costs in marriage, like hey, Why don't we? How many hours a week do married couples do it? Again, I don't know the answer. But the fact that sex is so small, it's like, well, maybe work is too great for sex. Or maybe, like, actually doing these things with people is more complex than you might think. And it can be pretty stressful if you do it too much. And you want a kind of respite or balance from that. But when you're thinking through, like, what is progress really? What is the good life? I'm struck by how many philosophers at some level have a vision similar to that of Keynes. But when I look at the data, and this surprised me too, like, my vision is kind of a philosophical one. You know, I became a tenured academic. What, what, like, what kind of parasite does that make me, right? So it's kind of a selection bias, but I had this Keynesian vision. But when I looked at all this data, I'm like, my goodness, the good life is work in large part. Actually, Marx saw some things which Keynes didn't. I think Marx was wrong to blame capitalist work. So Marx thought in the communist utopia people are still working because they enjoy it, they're just not working for capitalists. I think he was wrong about that part, but he was right about the work part. Or is Keynes was wrong because he had this Cantabridgian Don notion? When people consume more leisure, you know, I talked about like the hidden invisible household sector. Even when people do consume more leisure, there's another relative price operating here. Even the demand for leisure might be ruled by a substitution effect. So when you look at the different things people can buy with their money, like what has fallen in relative price the most? Actually, leisure goods have, for the most part, gotten a lot cheaper. You look at an index, leisure good prices, it goes down. Like, think of TVs. TVs are a lot cheaper, they're a lot better. Most— a lot of ways of having fun have gotten cheaper. The internet is a source of fun and a way you can connect with people to have that fun. It's a lot easier to organize a party with Facebook or other Apps. What are the things that have gotten more expensive? I mean, you'd have to say healthcare and education, higher education, right? Goes up every year. Textbooks, my goodness, everything expensive. So insofar as people, or some people, are consuming more leisure, even that may not be Keynes's income effect. There's a paper by Dora Acosta at UCLA, and she makes the argument— it's a a little hard to evaluate, but she's not obviously wrong. She says even the increases in demand for leisure we see, we can account for most of them in terms of the lower relative price of leisure, and that even that is not an income effect. So one thing we've learned in labor economics over the last 20, 30 years— I think it's not that well understood outside of labor econ, even amongst economists— But like 30 years ago, if you studied labor economics, you were told there was a substitution effect, an income effect, the labor supply curve might bend backwards, at higher wages people might work less. That's what was taught, but the empirics for like 30 years running have just come in one after the other. Substitution effect dominates. And I think a lot of the economics profession still has this older view that it's like all up for up for grabs. But it's not what the data shows. Substitution effect dominates. So, you know, getting back to this question, like, why has work remained so popular? Is it that daily life is stressful? Is it the problem solving? Some of it is surely that modern jobs are easier than older jobs. They're much safer. Our jobs are all really safe, right? Or they will be safe when you get a job. But there's a study I read, I found it very striking. It looked at some Germans, and it looked at German people who were unemployed. They had been laid off. And once they were unemployed, this is a common result in many studies of unemployment, the unemployed have quite low rates of happiness. They have higher rates of obesity, even though they have less money to spend. More likely to have problems with drug or alcohol abuse. Again, even in light of having less money to spend, they're more likely to kill themselves, more likely to report different sorts of life problems, divorce. But these, these Germans who were unemployed, well, they waited a few years and then they got to be old enough that they could be officially designated as retired. And once they became retired, I mean, their day didn't change. As unemployed, they didn't go to work. As retired, they didn't go to work. But they had a new label. With the new label, they reported being happier. So something about work— there's like a network effect, like you wanna work because other people work. So maybe there's like a coordination phenomenon, like maybe we could all more be in Keynes's world if we could get everyone else to go there. There with us, but we can't 'cause some of them wanna work, some of them have to work, like some Atlas has to hold up the world, right? So maybe each of us, like your best choice is to work because work is the norm, but it's not exactly the same thing as work being what you really wanna do. But people coordinate, like they mostly work the same hours, some version of 9 to 5. Again, university's a little different. There's a lot more flex time than there used to be, but most people work something like a Monday through Friday. There's a lot of regularity, people being in offices at the same time. Some of that is efficiency, like you work together, but I think some of it is, uh, it's easier to lure and hire good labor when you promise them, uh, other people. So I'm an academic. A lot of what I can do I can do at home. Not my Mercatus work, but my writing I can do at home. Where do I do most of my writing? In the office. Why am I such a fool? If I'm at home, I get a kind of cabin fever. It's like, where are the other people? I go into the office, the other people are there. I actually don't even want to see them a lot of the time. But I feel better. I don't feel I have to leave and go see people. I'm like, "No, I'm busy working. No, no." I could be home, but no, I'm in there at the office. I don't go in Saturday. It's like, "Oh, you go in for the printer." Well, a bit. But the printer's there on Saturday. But no, I go in Monday through Friday. Saturday morning I write at home. Sunday morning I write at home. Monday I'm really eager to get to work. Friday I'm starting to think more about home. So there are these funny social effects in all of these workplace decisions. And I think that's part of why work has remained so popular. One or two hypotheses I wanna look at. One is this idea of status competition. I've heard this from a number of philosophers. Joe Stiglitz has suggested this, that people keep on working contra Keynes because they're— it's like a rat race. They're just obsessed with status. And that's why Keynes's dream hasn't come about. Uh, I mean, I guess that's possible, but I don't actually think it's the main answer to the problem, even though it's the answer you hear most commonly. Uh, a few reasons is first, when you look at people's consumption behavior, status goods do not drive most of consumption. What predicts your consumption is like your income, your job situation, your age, your family situation, a lot of very basic economic variables. You put all of those together, they predict most of what we know about your consumption. Like your desire for status goods, like predicts a few percent of your consumption, but not most of it. This is well known in economics. So if your desire for status doesn't predict most of your consumption, I mean it really can't predict most of your labor supply behavior. So viewing life all as a big rat race, I think that's wrong. And a part of what this essay is doing, it's saying progress is real. It's not just a rat race. We like to work, and of course we like to spend this money. So it's a kind of funny paper which ends up at the simplest possible hypothesis. Like sometimes a paper, you start with a simple hypothesis and then you make it complex in interesting ways. This paper kind of starts with a simple hypothesis that not that many people really believe and then like doubles down, triples down on the super simple version of that hypothesis. It's like, "It's the money, people." And it's the other people at work and the funnier job. Like this, the kind of stupidest, simplest explanation of why you're out there like a maniac working for all that money, because you like work and you like money. Like the super reductive stupid answer, I think is actually mostly correct. Other problems with the status hypothesis, it doesn't explain explain any of the cross-sectional variation in the data. Like, why do teens work less now? Do they care less about status? That hardly seems plausible. Uh, there's good data showing the group that in percentage terms spends the most on status goods is African Americans, or in general, rising minorities with aspirations across a lot of cultures. They spend more on status goods to like show off or be aspirational. That's great, but they're not necessarily the same groups that work the most. So you just look at a lot of possible predictions. It doesn't hang together with it all being status. Furthermore, with status, well, why can't you pursue status by having a better vacation and putting it on Facebook? In fact, that's what older people do. It's what my wife does. She's not even retired. She has a vacation with me. She, like, takes all these photos, puts it on Facebook. That's her competition for for status more than anything. Like, "Oh, look at where we went, like here, there, whatever." So people being status competition driven can impel you to leisure as much as it can impel you to work. And also, you know, you look at some groups of people, they work less, they watch more TV, a lot more TV. If it's all about status, like why are they watching so much TV? It's a big substitution over time. It's like watching TV, so high status, Doesn't seem to be. So status hypothesis, I think, is much weaker than a lot of people think. Oh, so let me just finish up saying just a bit about prime-age working males, because I think they're the group that benefits the least from recent progress. Who benefits the most? I think it's pretty obvious. It's the elderly. They get this great leisure, they have way better healthcare, they don't have to pay for it. 80's the new 70 or the new 60 or whatever. You look at the data I've presented plus some other parts I haven't presented but we could talk about. I see all the more clearly than ever the group that in proportionate terms has benefited the most from recent progress is the elderly. Whether that's good or bad, I'm not saying. I just find it striking. Actually, the young— you go back to that wage diagram— wage is down since year 2000. But other indicators— I'm not sure the young have benefited very much from recent progress. Much harder to see. The group I think that has lost is lower-earning, less-educated prime-age working males. Are pretty clear, unambiguous, actually losers. And I think one reason why that is— this is going back to my opinions rather than the data— but if you think of individuals, especially perhaps males at certain age groups, as having a need to work, maybe it's almost biologically driven. It is a kind of competition in this case for status or for mates or for income or to be a provider. And those opportunities for them to work have been limited. Lower wages, more competition from women, more competition from emerging economies such as China. And that group is kind of biologically a bit addicted to work and some status, and they don't have it. And their social indicators are doing much worse. You can read Charles Murray's book Coming Apart on lower-earning, less-educated males and how much worse they're doing. It's a striking effect. Less interest in work, more delinquency, high rates of incarceration, high rates of, you know, heroin abuse. And that's another lesson. When you study recent progress, the biggest losers, I think, are pretty clearly prime-age working men. Biggest winners, the elderly. How do women fare in this? I think it's very difficult to say. How much are they working more? Because in some ways some of the males are not doing what they should and they need to make up the income and it's a source of unhappiness? How much are they working more because it's fun to get out of the house and not watch a 2-year-old all day long? I haven't seen any numbers to help me answer that question. I would just say it doesn't seem to be obvious. But in terms of winners, losers, those who hold equal, that's how I'd put it. Now to finally close, I said I'd give you a science fiction paper. Well, what's the future going to look like? Well, let's just assume economic growth continues. That's the most likely scenario. Basically, more and more of us will end up like those higher earners working a lot of hours because we like work and we like money. So my best vision of the future isn't John Lennon's "Imagine." There is no heaven, it's easy if you try, da da da. They play it in Nordstrom now, right? They play it in Nordstrom now. That's kind of the vision. We're all going to go to Nordstrom and work a lot and earn a lot. And that's like what the science fiction movie is going to look like, the spread of the norms of the current 1% or 3% or 5% to more and more of the population. That's my science fiction story for you today. We still have time for questions, but now I've done my work and you can do yours. Thank you.