Unless you have been living under a rock, you have probably heard the phrase, “Time is money.” It is often attributed to Benjamin Franklin (as many wise sayings are) but has been found to predate his writings. Regardless of who first said it and when it was said, we understand the concept. If we spend our time engaging in productive behaviors, we will earn more money. If we spend our time engaging in less productive behaviors, we will earn less money. In a rudimentary economic sense, it’s hard to argue with this.
But is spending time and spending money the same thing psychologically? We can intuitively grasp that money and time are interchangeable, but do we behave in such a way that demonstrates we really believe it’s true? That is the question the following article sets out to answer…
Article Summary: Which is the Better Option? Quicker or Cheaper?
Chang, C., Chang, S., Chang, J., & Chien, Y. (2013). Which Is the Better Option? Quicker or Cheaper?. Psychology & Marketing, 30(1), 90-101.
Shin-Shin Change of Chung Yuan Christian University and Chung-Chau Chang, Jung-Hua Change, and Ya-Lan Chien of National Taiwan University argue that there is a difference between the way we spend our money and the way we spend our time. Although both time and money are often simultaneously considered in making decisions (i.e. paying more for faster download speeds), it is possible that we prefer saving one at the expense of the other.
To set up the experiment, the authors highlight some of the fundamental differences between time and money:
- Usage: Time is used passively and subconsciously while money is almost always used consciously.
- Source: Time is a constant, inherent resource where as money is often earned.
- Evaluation: Time is evaluated subjectively while money is evaluated objectively.
- Budget Constraints: Time is limited to 24 hours while money has no theoretical limit.
- Fungibility: Present time cannot be saved for future use while present money can.
- Expectation: People are more likely to expect a future surplus of time than money.
The authors conduct three experiments in which they seek to answer questions about our preferences involving time and money. Each experiment corresponds to a hypothesis:
Hypothesis 1: People prefer the benefits of saving money to those of saving time.
Experiment one consisted of a survey administered to 77 undergraduate students in which they were presented with fictional scenarios involving trade-offs between time and money and asked about their preferences. The survey demonstrated that the preference for saving money was significantly higher than the preference for saving time.
Hypothesis 2a: Prompting people with the value of time increases their preferences for saving time over saving money.
Hypothesis 2b: Prompting people with the value of money has no affect on their preference for saving money over saving time.
A group of undergraduates were presented with two fictional scenarios, both involving a business trip abroad. In one scenario, an option to save time is presented to them and, in the second scenario, an option to save money is presented to them. When surveyed, the students reveal that mentioning the value of time increases their preferences for saving it while mentioning the value of money has no affect on increasing their preferences for saving it.
Hypothesis 3: Peoples’ preference for saving time diminishes more quickly over time than their preference for saving money.
Undergraduates were presented with two different scenarios, one involving saving time and another involving saving money. They were then surveyed about their attitudes involving time and money as well as their intentions as to which program they would adopt now, one month later, and six months later. The results showed that the preference for saving time diminished over time according to peoples’ intentions but not according to their attitudes.
Summation of the Results
The authors results can be summed up in these key findings:
- People prefer to save money than to save time.
- Prompting people with the value of time increases their preferences for saving it.
- Prompting people with the value of money has no effect on their preferences for saving it.
- As time passes, people increase their intentions of saving time.
The real eye-opener for me on this one is that, without being prompted with the value of time, people prefer to save money. When you really think about it, time is always more precious. Money is volatile. You can lose it all and gain it all back in a single day. With time, it’s either use it or lose it. While most of us understand the value of time intellectually, few of us behave as if we do. We squander our time all the while pinching pennies.
I think this research is a wake-up call to be more cognizant of how we are spending our time. Whether we are at work serving our customers or we are out shopping, we must realize that time is our most scarce and valuable resource. It costs more to try to fix the computer yourself than it does to hire an IT guy to do it. It costs more to travel to the other end of town for a better price than it does to just settle for what’s right down the street. Because, in both of these scenarios, we are losing time. We need to be constantly aware of the seconds ticking away. Because, if we aren’t aware of it, we’ll squander it.
Questions for Future Research
- Would the results hold for groups other than undergraduates? People working full-time? People who are retired?
- How could this study be done using observation rather than surveys? Would people behave differently than they say they would?
- How can people increase the extent to which they are conscious of how they are spending their time?
- Would the results of the study still hold across income levels?
Featured image courtesy of servus licensed via Creative Commons.