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(Chapter 3) Is SET Management Practical - A Thought Experiment-1

This document discusses the concept of "set management" and how reducing the work week and consumption could benefit both workers and society. It proposes that if worker productivity increases by 25% due to new technology, their work week could be reduced by 20% while maintaining the same pay. Alternatively, if everyone worked a 4-day week for 80% of the pay, consumption would decrease by 20%, which individuals could adjust to with less space, vehicles, and clothing. Full employment could be achieved by hiring the unemployed, which may increase costs by 10% but reduce social issues and save on associated expenses. Overall it questions if a society with a shorter work week and 20% lower consumption but full employment could be considered "better" with increased

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Genieffer Kate Gulfo
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36 views

(Chapter 3) Is SET Management Practical - A Thought Experiment-1

This document discusses the concept of "set management" and how reducing the work week and consumption could benefit both workers and society. It proposes that if worker productivity increases by 25% due to new technology, their work week could be reduced by 20% while maintaining the same pay. Alternatively, if everyone worked a 4-day week for 80% of the pay, consumption would decrease by 20%, which individuals could adjust to with less space, vehicles, and clothing. Full employment could be achieved by hiring the unemployed, which may increase costs by 10% but reduce social issues and save on associated expenses. Overall it questions if a society with a shorter work week and 20% lower consumption but full employment could be considered "better" with increased

Uploaded by

Genieffer Kate Gulfo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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IS “SET MANAGEMENT” PRACTICAL?

: A THOUGHT EXPERIMENT
Let’s say a particular innovation improves a worker’s productivity by 25%. Rather than
take this 25% increase in productivity and try to sell 25% more product, a SET
perspective might be inclined to reduce worker’s workweek by 20%. For example, if a
worker can build 5 cars in 5 days, but a new technology allows the worker to build 5
cars in 4 days, then why not give workers a 4-day workweek (and a three-day
weekend)? Theoretically that worker could still be paid the same wage as a 5-day week.
(This kind of logic works at Semco),
Alternatively, what if everyone currently working a 5-day week would agree to work a
4-day week, and agree to do so for 80% of their current pay. Let’s assume that this
would result in 20% decreased in goods and services for sale. Could the average
consumer live on 20% fewer goods and services? Probably. For example, amount of
square footage per person has doubled in USA over past 50 years. If we lived in 50%
less space, our mortgages and heating costs would also be reduced. Also, it has been
estimated that the cost of owning and driving a car is the equivalent to about 20% of the
average salary. Give up a car, and you get a three-day long weekend all year long. The
average American buys 68 new garments a year. Buy only 54 garments, and you’ve
reduced consumption by 20%.
Let’s take this one step further. Let’s say we hire all the currently unemployed people
(let’s say unemployment rate is 10%), and let’s assume that this would increase the cost
of goods and services by 10% (due to inefficiencies). Would you be willing to pay 10%
extra for goods and services if you knew it would solve unemployment?
Actually, you might even save money, if you consider the reduced negative social
externalities that might occur with full employment. If there is no unemployment, then
there is less need of social assistance for the unemployed, there would likely be less
crime, lower costs of incarceration, fewer mental health issues, and so on. These cost
savings would likely go a long way towards “paying” for the extra costs of employing
everyone. Indeed, there are people on both the right and left sides of the political
spectrum promoting the idea of a guaranteed income because it is both socially just and
saves society money.
Questions for discussion
Imagine a society where the average person was working four days a week, consuming
20% fewer goods and services, and there was pretty much full employment. Would
such an economy be “better” than our current economy? Would the extra free time, and
the extra trust and quality of life in society more than make up for our 20%
consumption in iPhones and blue jeans and bigger houses and cars?

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