I previously wrote a short thought on this, and now I have fleshed out my thinking.
Today’s essay is an analysis of the core of economics:
If scarcity didn’t exist, there would be no need for economics. Everyone could have everything they want, and there would be no cost involved.
But, the resources in the world are limited, and there is also the ultimate limit to be considered, the limit of time. Each of us only has a limited amount of time to live, and so we also need to consider our use of the time that we do have available.
In order to make these choices, we need to consider opportunity cost. Opportunity cost is the cost of something in terms of the next best alternative. For example, if you spend an hour studying for an exam, you give up the opportunity to do something else with that hour. The opportunity cost of studying is the grade you could have gotten if you hadn’t studied, minus the grade you actually get.
It is one of the cruel jokes of life that we never really know when we will die. In the last two months, two people I have known quite well have died at ages 41 and 49, which is considered quite early and unexpected.
Neither of these two individuals would have considered the possibility of death in the last twelve months, and yet it happened. They are gone, and the opportunities and expectations that they had in life are no longer available to them.
It is this ultimate scarcity, the scarcity of time, that makes opportunity cost so important. We must make choices about how we use our time because we will never get that time back.
When we think about the cost of something, we need to think about the opportunity cost as well. It is not just the monetary cost that we need to consider but also the cost in terms of time and opportunity.
What is the opportunity cost of your time? What are you giving up by spending time on this activity? Is it worth it?
These are important questions to consider because our time is limited. We only have a certain amount of time to live, and we need to make the most of it
I have often run through some thought experiments about how things could be like if there were no limits. Let’s take two of these experiments:
How would life be if we were truly immortal? If there was simply no way that we could die, and we can assume a significant amount of bodily regeneration so we could remain in the current state that we are now. At first, this does seem quite amazing, the entire world and an unlimited amount of opportunities to do anything you could desire.
There have been some good movies made on this topic, such as the “Man From Earth” and “The Age of Adaline” which I highly recommend. Funnily enough, in neither of these movies to the main characters, who cannot age, seem particularly happy. They seem to be living with a condition rather than enjoying it. There is a degree of defeat, a lack of meaning in their lives.
Why is this the case? I think it has to do with the way that we as humans value things. When there is no limit to our time, then everything becomes devalued. If there is no end, then what is the point of anything? We can simply postpone everything into the infinite future, and nothing would matter.
Immortality would eventually lead to a world where nothing matters because everything is just an infinite repetition. There would be no need for innovation or change because why bother? Everything that could be done would already have been done an infinite number of times.
And this touches on what I mentioned earlier. If there is an unlimited amount of something, it ceases to have any value because value is derived from scarcity. This would undoubtedly be true of unlimited time, with the only side note being that while someone may live forever in our thought experiment, they cannot be in two places at once, and so they can only experience a particular decade within a decade. So they can still not do everything that they wanted to do within that particular time frame, and when that time is gone, some opportunities are lost.
I suffer quite badly from procrastination.
Often I put things off for weeks that need to be done quite urgently, and it causes me some mental anguish. When I eventually get round to doing the thing in question, I realize that it only took five, ten, or twenty minutes. I could have done it at any point in the last few weeks and not have it hanging over me, but I didn’t.
I put it off, because I was always under the assumption that I would do things tomorrow. And then when tomorrow comes, the same thinking happens and I put things off into the next tomorrow, ad nauseam.
Speaking to many people across the world in my travels and work, I know that I am not the only person who suffers like this. It is almost as if many of us are split into two people:
- The Today-Self
- The Tomorrow-Self.
The today-self is a child and more primitive as if it is powered by the older parts of our brain, such as the reptilian and limbic brain. Emotions carry us away, and short-term thinking predominates.
We want to focus on the immediate payoffs, such as playing games instead of working, watching Netflix instead of studying, being on Tinder instead of building real relationships, and going out and getting drunk instead of having a good night’s sleep. It behaves as if today is a one-off incident, and there is nothing else worth concerning ourselves about.
The Tomorrow-self is the adult in the room. It is the more logical and evolved part of us. It can think long-term, can see the benefits of delayed gratification and knows that we need to make sacrifices today to reap the rewards tomorrow. It uses the Neocortex and the lateral frontal pole, the newest part of our brains that are responsible for making us human. This is especially true of the lateral frontal pole, which is responsible for planning and decision-making and appears to have no equivalent in the monkey brain.
The Tomorrow-self understands that the things that truly matter in life are not accomplished in a day but by a long and painstakingly slow process of small daily accomplishments towards a goal far away in the future.
It knows that if we want to be successful, we must work hard today and put in the hours, even when we don’t feel like it.
The problem is that the Today-self is always in control because the Tomorrow-self can only exert its influence through willpower, and willpower is a finite resource. The Today-self knows this, and so it is constantly looking for ways to undermine the Tomorrow-self and its plans.
One way it does this is by procrastination. It tells the Tomorrow-self that there is always tomorrow to do the things that need to be done today. And so the Tomorrow-self agrees, and puts off doing the things that it knows need to be done, because it believes that there truly is always tomorrow.
But the truth is that there is no such thing as always tomorrow.
One day, the tomorrow that the Tomorrow-self was counting on will never come. And all of the things that the Tomorrow-self wanted to do will remain undone.
This is why we need to be aware of the power of procrastination and learn to overcome it. We need to take control of our Today-self and stop putting off until tomorrow what can and should be done today.
Only by doing this will we be able to achieve our goals and live the life that we want.
Most people overestimate what they can do in one year and underestimate what they can do in ten yearsBill Gates
Can you imagine how immortality would change the fight between our Today-self and Tomorrow-self? Because there is always a guaranteed tomorrow if you are immortal, then it is never worth doing something today.
But if we only have a limited time on this earth, then suddenly, every day becomes precious. We need to make the most of today because we don’t know if there will be a tomorrow. That said, a lot of people live in denial of death, and live as if there is unlimited time, not taking the time to understand that each day is a gift.
Immortality would change the game completely, and I don’t think that the Today-self would stand a chance against the Tomorrow-self.
What do you think? Would you want to be immortal? Or would you rather make the most of the time that you have?
My feeling is that an immortal being would be at risk of becoming the ultimate procrastination machine.
Having unlimited potential but accomplishing nothing.
Let’s move our focus to how things would be with unlimited electricity. This is actually a significantly more likely scenario than immortality and may actually come about in the not-so-distant future.
This would be accomplished by building a Nuclear Fusion reactor, which promises to generate electricity by using the heat generated from nuclear fusion reactions.
Essentially, in a fusion process, the reactor would combine two lighter atomic nuclei to form a heavier nucleus. This releases energy, which we can use to power turbines and generate electricity.
A single fusion reactor could power an entire city, and there would be no need for fossil fuels or anything else.
But, the most important thing is that, theoretically, these reactors should output more energy that is required for us to input into them.
It has been said that this technology is perennially 30 years away from being developed, but perhaps one day, it will really happen.
So let’s think about what would happen if all the theoretically and practical problems were solved and we came up with a standardized series of reactors that could generate unlimited electricity.
Let’s remember, that things that are unlimited tend to have very little value, so we could expect that electricity prices would drop significantly. This would be wonderful, especially as high electricity costs affect the poorest people in the world more, as they spend a larger percentage of their income on electricity.
I experience this when I lived in Cambodia for close to 8 years — all the electricity was purchased from Vietnam and so was more expensive than anywhere else I had previously lived.
But what other impacts could this have?
Well, one significant impact would be on the transport industry. Electric cars would become the norm almost overnight as they would be cheaper to run than petrol or diesel cars. This would lead to a huge decrease in air pollution as electric cars produce no emissions.
We could also see a rise in the use of robots in manufacturing as electric motors are much more precise than petrol or diesel engines. This would lead to an increase in the accuracy of manufactured products as well as a decrease in production costs.
Overall, I think that unlimited electricity would be a good thing as it would lead to cheaper energy prices, less pollution, and more accurate manufacturing.
Of course, electricity wouldn’t be free because there would still be some costs associated with running the infrastructure, such as maintenance, security, management, and so on.
But let’s imagine that it becomes so cheap to be a non-cost, something in line with a 100-fold or 1,000-fold decrease in the median price of electricity per kilowatt.
The obvious thing here is that we would all start using a lot more electricity, and it would make a lot of things that were not previously commercially feasible suddenly look very attractive.
You wouldn’t bother rationing heating and air-conditioning in your house because there is essentially no cost to keeping it on all day. The cost of all materials related to technology and battery storage would sharply increase in price, as the demand would skyrocket.
One of the main costs and limitations to computing power right now is the electricity costs required to power the computers and the cooling systems to ensure that they are running at a suitable temperature. With a sharp drop in that cost, you can imagine the swift technological and scientific improvements. We could run the algorithms that explore protein folding on thousands of times more machines than we do now.
And we would be able to do it for a tiny fraction of the cost.
But, electricity would also create waste heat, and so this would create a ceiling where we cannot use more electricity within the confines of planet earth without making the planet unlivable for the human species.
So, let’s move away from thought experiments and onto economics, and then how we can also apply some of the principles of economics to our own lives by asking the key question:
At What Cost?
British economist Lionel Robbins gave this definition of economics:
Economics is the study of the use of scarce resources which have alternative uses.
Scarcity means that what is available is less than what everyone wants.
This is the reality of the world that we live in, and no increase in production will ever change that.
But what Robbins’ definition doesn’t take into account is that people also have different preferences.
Some people may want more of one thing, and some people may want less of another.
These different preferences lead to different values placed on things, which in turn drives market prices.
In other words, economics is the study of how people use scarce resources to satisfy their unlimited wants and needs.
One of the key concepts in economics is opportunity cost.
This is the idea that when you make a choice, you are also giving up the opportunity to do something else.
If we could interview everyone alive today, and sum up all of the things that they want, it would likely be hundreds of times more than the production capability of humanity and the number of raw materials available in the world.
In other words, we face scarcity.
But because people have different wants and needs, they also have different opportunity costs.
The opportunity cost of you reading this essay is that you could be doing something else instead. You could be sleeping, watching TV, working, eating, or any number of other things.
The opportunity cost of my writing this essay is that I could be doing something else instead. I could be spending time with my family, playing video games, working on side projects, or any number of other things.
We make decisions based on our opportunity cost because it represents the trade-off that we are making. In order to do one thing, we have to give up the opportunity to do something else. The concept of opportunity cost is one of the most important ideas in economics, and it’s also one of the most misunderstood.
The reason it’s so misunderstood is that people often confuse it with the monetary cost of something.
But the two concepts are very different.
- The monetary cost is simply the amount of money that you pay for something.
- The opportunity cost is the value of the next best alternative use of your time, money, or resources.
To put it another way, opportunity cost is what you give up when you make a choice.
It’s what you could have had if you had made a different choice.
And this is not considering the fact that if people get what they desire, they tend to form new and ever-increasing sophisticated desires. A young man in Burundi (one of the poorest countries in the world) may just want a better bicycle to go to work and some comfortable shoes — things that would make a significant improvement to his day-to-day life. A similar young man in a developed country may already have 100 times the dreams of the man in Burundi, but still feels dissatisfaction.
Welcome to Hedonic Treadmill. I’ve written about this before, so there is no need to repeat myself.
Clearly, not everyone can get precisely what they want, so there will always be unmet needs, regardless of how we organize society along feudalist, capitalist, socialist, communist, or any other “ist” lines.
This is the reality of the world, and this is the basis of what economics deals with.
A Quick Philosophical Aside.
Economists and politicians tend always to discuss the unmet needs and the “rights” of people to have certain resources such as health and education (which are also, unfortunately, scarce).
So the equation can be written like this:
Desires > Resources
Desires are always higher than resources.
And there is debate on how to best increase resources, how to divide them up in a fair manner, and who accesses what.
But, they tend to forget the other half of the equation, which is the desires.
The philosopher of Ancient Greece and India did spend a considerable amount of time thinking about this side of the equation and came to the conclusion that the best possible course of action for an individual is to work on reducing their desires instead of trying to achieve them.
The Stoics, Epicureans, and Buddhists all have different ways of looking at this, but the main idea is that if you can reduce your desires, then you will not be disappointed or sad when you do not achieve them.
You will also be less likely to harm others in your quest to achieve your goals.
And, most importantly, you will be happier because you will be content with what you have.
The problem is that people are not taught to focus on reducing their desires.
In fact, they are quite the opposite.
They are bombarded with marketing messages telling them that they need the newest gadget, the latest fashion, the coolest car, etc.
They are taught that they need to consume more and more and, significantly, that their happiness comes from acquiring these things.
The problem is that this is not true.
Happiness does not come from acquiring things. It comes from having good relationships, doing meaningful work, and feeling like you are a part of something larger than yourself. These are the things that make us happy.
So, if we want to be happier, we need to focus on reducing our desires instead of trying to increase our resources. We need to learn to be content with what we have.
Of course, this is easier said than done.
I am not sure how this would then scale up to the level of a global society, but it would most likely mean a radical shift away from consumerism and materialism and towards a simpler, more considerate lifestyle.
If you’re interested in this line of thinking, read my essay “How Much Is Enough?”.
Back to economics.
So how do we square the fact that the sum of all the desires of everyone in the world is more than the world’s material capacity?
Well, it turns out that we have already found a way to deal with this for thousands of years:
Things have a cost.
And I don’t want to anchor this discussion on money specifically. Thomas Sowell puts it well:
Although the word “economics” suggests money to some people, for a society as a whole money is just an artificial device to get real things done. Otherwise, the government could make us all rich by simply printing more money.
Quite obviously, the government cannot make us all rich by printing unlimited amounts of money because unlimited things have no value.
As of June 2022, there is a significant level of inflation, especially in the US. This is hardly surprising, considering that approximately 20% of all US dollars were created in 2020 alone. The higher prices that we are all seeing, even outside of the US, are the hidden tax that we pay for the creation of these dollars.
Because dollars are used globally, the US can tax the entire world with inflation. I’ll leave this discussion for another time!
Anyway, so things have a cost. Individuals can make a decision if a particular thing in question is worth the cost. A company does the same thing, but with shareholders’ money.
The government also has to make these decisions, but there is an important difference:
The government doesn’t have shareholders.
The government gets its money from taxes. And while some people may argue that taxes are a form of cost, they are not. They are a transfer of wealth from one group of people to another. This is fine, and makes sense. We all have different opportunities in life, and creating a social safety net benefits everyone.
The government can create money out of thin air and use it to buy things. It doesn’t have to worry about making a profit or loss as a company does.
Of course, this comes with its own set of problems (inflation being one of them), but that is a discussion for another day.
The reason I named this essay “At What Cost” is because this is the question that we need to ask both in terms of policy and as individuals when pursuing a specific course of action.
We need to weigh up the alternative uses of our time, money, and raw resources.
One thing I find quite funny about politicians is the discussions on policy about making things affordable. Let’s take, for instance, healthcare. When politicians want to put a policy in place to make healthcare affordable, they are not talking about the root causes of why healthcare is expensive. They are not discussing improving the efficiency of how healthcare is provided or any tactical initiatives to make hospitals and the entire healthcare network more efficient.
They simply want to shift the cost from the person having the specific health problem to everyone who pays taxes. This is not a bad thing per-se. I don’t want to live in a society where someone is left to die on the street because they cannot afford healthcare or where they let small healthcare issues become larger, more expensive, and unavoidable problems because they didn’t want to spend money upfront.
Instead, they talk about two things:
1. Reducing the cost of insurance
2. Increasing subsidies
Number one is a non-solution because it doesn’t address the root cause of the problem. All it does is transfer the cost from one group to another. In this case, it shifts the cost from the sick people and their families to the insurance companies.
And number two is just a way of making something free by using other people’s money. It doesn’t make healthcare affordable; it just makes it free at the point of use.
But we must ask ourselves, what is the real cost of healthcare? And more importantly, what are the opportunity costs of making healthcare free?
The answer to the first question is quite simple: The real cost of healthcare is the sum of all the resources that are used to provide it.
This includes the time of the doctors and nurses, the cost of the equipment, the buildings, and everything else that goes into providing healthcare.
The opportunity cost is what we forego when choosing to use our resources in a particular way.
In other words, if we use our resources to provide free healthcare, then we cannot use them for anything else.
We must ask ourselves if making healthcare free is worth the opportunity cost. Is it worth giving up other things that we could have done with those resources?
For instance, we could have used those resources to build more schools or provide more scholarships. We could have used them to improve our infrastructure or even to build more hospitals.
The opportunity cost of making healthcare free is that we cannot do those other things. And that is a decision that we need to make as a society.
As individuals, we also need to make these decisions all the time.
Every time we spend our money, we are making a decision about what we value and what we want to achieve with our lives.
Changing who pays for the cost of healthcare does nothing to change the cost of healthcare. In fact, it may actually be more expensive for governments or insurance companies to pay for healthcare than for individuals to pay for it directly because of all the added bureaucracy involved.
After all, every dollar spent by an insurance company on anything but paying hospitals and doctors is a dollar that is wasted and does not benefit anyone in a medical sense.
But, there are also large medical expenses that individuals simply cannot afford to pay, and so the benefits of private or social insurance outweigh the overall costs.
These are the hard decisions that we need to make. And it is important to have a debate about these issues so that we can make informed decisions about our healthcare system.
So, if we take the standpoint of scarcity, and view healthcare through this prism, then we can start to design better policies for healthcare.
After all, we cannot spend an unlimited amount of resources on healthcare as a society, and this is where reality puts a dent in our best intentions.
The ideal scenario, of course, is that healthcare is completely free to any individual that needs it and that it is high quality, and there are no waiting times. If you have a problem, you can be seen right away by highly competent doctors, nurses, and specialists using the latest and best technology available, and it doesn’t cost you anything.
But, we don’t live in this fantasy world of unlimited resources, or perhaps this is physically possible, but the cost of doing this and gathering the required resources would impact other areas such as policing or other social welfare initiatives.
So, there are two key factors in any part of an economy and this is supply and demand, and different policies will affect these in different ways.
In healthcare, the demand is driven by several factors.
- The overall health of the population. The more unhealthy the population, the more demand there will be for healthcare. This is especially true for chronic diseases that have not been treated for years, requiring ongoing treatment and cost.
- The cost of healthcare to the individual. If healthcare is completely free for all treatments, you will have higher usage (and also potential abuse) compared to a system where an individual has to bear some cost towards the treatment, even if its only a fraction of the real underlying cost, and if that is variable depending on how much a person earns.
- The availability of healthcare. If there are long waiting lists for treatment, or if treatments are not readily available in your area, this will also increase demand as people seek out alternative methods or providers.
For the supply side:
- The attractiveness of becoming a healthcare professional. This includes the wages paid, the working hours and conditions, the amount of education required, and so on.
- The cost of the equipment and medicines required for treatment.
- The amount of tax, if any, the hospitals are required to pay. This is an important consideration because, in the case of private institutions, investors’ funds will tend to flow to the places that provide the highest returns, and a low-tax environment for private hospitals can ensure that more investment is directed towards building new hospitals, which eventually increases the competitive pressure and leads to lower prices.
- The number of hospital beds per person. This is an important metric because it determines how much capacity the healthcare system has to cope with demand.
There are many other factors that can affect both the demand and supply of healthcare, but these are some of the most important ones. So, if we want to have a debate about the cost of healthcare, we need to think about both the demand and the supply side of the equation. And we need to think about how different policies can impact both of these
And so, just with an initial overview of the most basic considerations of the supply and demand side of healthcare, we can see that this is a complex topic.
The idea of just “making healthcare affordable” starts to seem quite pedestrian.
In reality, we should be speaking of tradeoffs and “at what cost”.
Let’s take the idea that healthcare should be completely free for anyone that needs it, regardless of the type of illness or accident that they have had. This policy comes from an altruistic perspective and is a noble goal. We don’t want a society where people die of preventable causes, and we expand our circle of care from just ourselves and our immediate family to consider society as a whole.
But, we must also consider the costs and unintended consequences of possible policy directions. If something is free, this can be equivalent to making something unlimited. Very much like when in our thought experiment electricity was free, we would just leave our air conditioning units on all day, because there was no cost.
So, if we make healthcare free, we are for sure going to drive up the number of people who seek some type of treatment within our healthcare system. But if the underlining reality does not change, such as the number of hospitals, available beds, doctors, nurses, operating rooms, and so on, then there will be an obvious consequence of longer waiting times.
Even if we ignore the moral and ethical implications of rationing by waiting time, this can have a direct impact on people’s health as some treatments will not be received in time.
In some cases, this is not an issue. If you’ve broken your arm and you have to wait 6 hours at the accident and emergency center to get treatment, it will be uncomfortable, but you’ll be just fine in the end.
If you have to wait months or years for the treatments of chronic disease, this can completely ruin your life, and in some cases, it is practically a death sentence.
Another cost that is often not considered is that of the quality of care. When we think about free healthcare, we often implicitly assume that it will be the same quality as what we currently have, just without the cost. But, if we take away the financial incentive for providers to give high-quality care, this could lead to a decline in standards. Also, if there is more demand but the same budgets and number of doctors, the output will be fewer maintenance cycles on machinery, and doctors who are stressed and spending less time with patients and making more costly mistakes.
So, when we think about making healthcare free for all, we need to consider the potential costs and trade-offs. We can see that it is not as simple as just making it affordable. We need to think about how this would impact both the demand and supply of healthcare and what the consequences might be.
We need to consider not just the goals that are outlined in policies, but second and third-order consequences of the policies, especially with regards to the incentives that the policies create, as well as the underlining reality of scarce resources.
Perhaps the best policies are the ones that aim to fix the underlining causes of an imbalance of supply and demand vs. only shifting who picks up the final bill (which is also important!).
So, for instance, if we want to reduce long waiting times while still keeping the goal of having completely free healthcare, then additional policies would have to be created to tackle the supply side of healthcare, including subsidizing education for new doctors and specialists, increasing salaries to motivate more young people further to choose what can then appear to be a promising career path, and so on.
But all of these come at a cost, which is why we need to evaluate and debate the best policies constantly.
We must be mindful of the trade-offs and not just focus on the benefits
At What Cost, Personally?
Let’s turn back to our personal lives and think about how this type of thinking can benefit us as we go about structuring our life.
One key message is that in the same way that there are more desires in the world than there are resources to meet those desires, this may well be true in our personal lives as well.
Unless you are fantastically rich, and perhaps even so (as there is always someone richer!), there will be things that you cannot have.
You may want to purchase a new car, go on an amazing vacation, and buy a beautiful home, but you will likely have to choose which of these you can actually afford and save up for.
It is important to be mindful of the trade-offs that we make in our lives and not just focus on the benefits. Every decision comes with costs and opportunity costs.
For instance, if you spend $100 on a new shirt, that is $100 that you cannot spend on something else. The opportunity cost of buying the shirt is everything else that you could have bought with that $100.
In the same way, if you decide to spend an hour watching TV, that is an hour that you could have spent doing something else, like reading, working out, or spending time with friends or family.
The opportunity cost of watching TV is the other thing that you could have done with that time.
And so, when we are making decisions in our lives, we need to be mindful of not just the benefits but also the costs. We need to think about what we are giving up in order to get what we want.
Only by taking into account both the benefits and the costs can we make truly informed decisions about how to best structure our lives.
The right strategy is not to work harder to make more money to be then able to afford these things but to work to stop desiring them in the first place.
We should think about what is it that we truly need to be happy and content in our lives and not get caught up in the never-ending cycle of consumerism.
By learning to be content with what we have, we can find true happiness and freedom.
If you make an analysis of your current situation, you probably have many of the things that you once wanted in the past, and yet you want more. So, you can quite easily imagine a future state where you gain the things you want right now and are still unsatisfied.
Do we need to keep playing this game until the day we die?
Of course not! We can choose to break the cycle at any time. It is important to remember that we always have a choice.
We can just accept what we have and be content. Because every single thing we introduce in our lives has a cost, it will eventually turn out in a disappointment.
Any material thing that you own right now will likely:
- Be Stolen. This has happened to me on numerous occasions.
- Completely Break. Accidents happen, and you can expect that many of the things in your life will break either by your mistake, or at the hands of other people.
- Require Maintenance. Anything that is mechanical in nature, if used long enough, will require some type of maintenance.
- Become Obsolete. This is especially relevant in this age of digital technology, where hardware quickly becomes incompatible with new system protocols and the latest software, which essentially turns an old gadget into a pile of plastic and metal. I used to shoot a Leica M3 camera from the 1950s without any problems, but likely a digital camera that is 20 years old would struggle to work with any modern software systems.
The list above is not exhaustive, but it does show that the things we own come with a lot of costs and headaches. These costs are often hidden from us, because we don’t think about them when we are in the process of acquiring new things.
It is important to be mindful of these costs when making decisions about what to buy and what not to buy. We often make the mistake of thinking only about the benefits of something without considering the costs.
So these are factors that need to be considered when bringing something new into your life. These are often hidden costs that people do not consider but are real.
You also need to consider the alternate use of your money and time. I often like to think of things that I buy with regard to the amount of time that I had to work to earn the money. I have calculated my hourly and daily rate, and anything that is less than an hour or two of my rate, I don’t spend too much time considering or worrying about.
If something costs more than a day, and especially more than a week, then I will really think if is worth giving up that money, that IOU from society for the work that I have already done, in exchange for this specific material good.
On a rational analysis, if we keep asking this question of “at what cost”, we realize that many of the things we may have initially considered good value are actually not very good value at all because they make our lives more complex.
There are many reasons why a simple life is best. When we reduce the number of things that we own and the number of things that we consume, we can live more peacefully and happily. We don’t have to worry about keeping up with the Joneses, and we can focus on more important things in life.
When we simplify our lives, we can also save money and time. We don’t have to spend as much time shopping or maintaining our possessions, and we can use that time to do more enjoyable activities. We can also save money by owning fewer things because there is less chance of them breaking or becoming obsolete.
Ultimately, a simple life is best because it allows us to focus on what is truly important in life. We can enjoy our relationships with family and friends, and we can spend our time doing activities that bring us happiness and satisfaction.