In his “Anecdote Concerning the Lowering of Productivity”, written in 1963, the West-German writer Heinrich Böll humorously contrasts the mindset of an enterprising capitalist, bent on the maximization of profit, with that of a person we might call a profit “satisficer,” a maximizer of leisure or happiness, or, less politely, a bum. The anecdote is suggestive, as it leaves the reader wondering whose behavior is in fact rational, or whether we observe here a clash of two rationalities supported by different economic cultures and (un)explained by different theories of economic behavior. Motivated by the question whose behavior makes which sort of sense, we present in this paper a system of utility functions that captures both logics of action simultaneously using purely rational choice based reasoning. The three formulas are integrated into a single and simple dynamic equations system which allows us to identify key factors in the generation of utilities explaining the real-life diversity of work-leisure decisionmaking, in particular the impact of occupational dynamics, personality characteristics, and government intervention. The model sheds considerable light on the familiar yet under-investigated phenomenon of widely varying levels of what Böll calls “Arbeitsmoral,” is interestingly rendered in the English translation as “productivity,”1 and what has rarely been acknowledged for what it is: differences in choices on work-leisure trade-offs and economic lifestyles that pose an important challenge to mainstream microeconomic, welfare state, and development theory.
|Name||AIAS Working Paper|
|Publisher||Amsterdam Institute for Advanced labour Studies|