Spending Time versus Spending Money

2004/09/01 by Erica Mina Okada, Stephen J. Hoch · 4 citations
Decision Sciences · Economics, Econometrics and Finance · Social Sciences · #Decision-Making and Behavioral Economics #Housing Market and Economics #Experimental Behavioral Economics Studies

paper · doi:10.1086/422110

openalex publication_date 2004/09/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/11

Abstract

We find systematic differences in the way that people spend time versus money. Ex post, people are able to more easily accommodate negative outcomes by adjusting the value of their temporal inputs. Ex ante, people are willing to spend more time for higher risk, higher return options whereas when spending money the pattern is reversed and the more standard pattern of increasing risk aversion is observed. Although accurate assessment of the opportunity costs of time is key to making good decisions, ambiguity in the value of time promotes accommodation and rationalization.

Citations

• Subjective Construal, Social Inference, and Human Misunderstanding
• A Theory of the Allocation of Time
• The case for motivated reasoning.

Cited by

• The economic evaluation of time: Organizational causes and individual consequences
• When time is money: The effect of hourly payment on the evaluation of time
• “The Time vs. Money Effect”: Shifting Product Attitudes and Decisions through Personal Connection
• Economic evaluation of time [wikipedia]