What time is money?
The amusing article was literally recently published on Habré: " $ 100 per hour ."
The article, in my opinion, is ignorance or misunderstanding of the author of the basic economic principles, forgetting about which he builds his theory.
Judging by the text of the article, the author a priori believes that time for rest and leisure is literally time actually spent in vain. Although he carefully cuts it out of the general theory, saying that such "high matter" cannot be evaluated in monetary terms.
In general, if we continue to develop the chain of sophisms of the author, cited by him in the article, then one can easily come to the conclusion that the feelings and emotions of a person are neurological rudiments. The crown of human evolution will be cyborg.
It would be fun and even fun if the article did not pretend to present a serious life position, with an attempt at its very real economic justification.
')
The article is accompanied by many witty comments from readers. But let's try to make out this theory, pragmatically and seriously, because the problem of “estimating time” is often raised both here and in everyday life.
How to calculate the cost of your work hour if you are not a hired employee with a fixed salary and the task becomes not so mathematically obvious? (Although in this case it is not obvious).
Questions about the formation of the value of goods and services, the very concept of money - lie at the origins of economic science. Retelling them is long and not interesting.
Consider a person as a production object, and the result of his activity as a product of intellectual labor, which is sold and bought.
A person, like any object of the production process, is a “thing” that wears off. Moreover, the useful life is officially determined (by the state) - this is the retirement age. Like any object, it can exceed this lifetime, but this limitation must be taken into account in the calculations and the formation of the cost per hour of work.
In accounting there is a concept - depreciation .
So, if to speak in the language of accounting, then time for rest and leisure is the means of depreciation of a person. To understand what will happen if you omit this factor, consider the following example from real economic practice.
Even under the condition that you properly cared for the machine, it still fails over time, it will need to be replaced with a new one or it will be necessary to make a major overhaul.
Accordingly, if you do not take into account in the pricing (cost) the amount of depreciation deductions, and you do not deduct it from the profit, then after some time you will literally find yourself at the bottom of the trough.
Now, I think it is obvious that if you do not take into account the cost of your time for rest, leisure and sleep in the cost of your working hour, the “failure” will not take long to wait. This will manifest itself either in the form of a decrease in labor productivity, or in a disease - a “breakdown”, requiring partial or capital repair, or in death, requiring your complete replacement (as it doesn’t sound cynical).
It follows that the time for the useful exploitation of human labor is limited. Empirically, it is defined on average as 8 hours. For each person, this time is still individual: it can be both less and more, but it certainly should be clearly defined. Once this is done, you can proceed to calculate the cost of your working and non-working time.
As a conclusion, I would like to consider some of the sophistries from the article: " $ 100 per hour "
To begin with, it is obvious that the example of wine is incorrect. By virtue of the fact that a person spent non-working time on going to the theater, which means that at that moment his time should have been appropriately evaluated. Those. if the hour of working time is 600 rubles. (A), and your working day is 8 (B) hour, then the hour of your non-working time will be considered as: (A) x (B) / 24, which in this case will be 200 rubles. at one o'clock.
Accordingly, the idea that to return (to spend 30 minutes for a bottle of wine for 287 rubles) will be “expensive” only when your working hour costs more than 1,500 rubles, provided that the 8-hour working day, and provided that the wine you didn’t have to - otherwise you still have to take the time to go to the store and buy another bottle of wine. And this luxury is only possible if your hourly rate is much higher.
If you do not include in the cost of work - trips, negotiations, meetings and possible numerous edits from a client, then obviously you will not be able to provide enough quality service to your client.
The reluctance to meet with the client in the physical ability to do this should alert the client accustomed to good service.
If you begin and end negotiations strictly on the agenda, then most likely you do not know how to negotiate at all.
The statement that working for an idea is a waste of your own time and money is true only if you have no idea what investment is. Otherwise, you understand that when you are offered to work for future benefits (ideas), then you are offered to invest.
In this case, do not forget that in the process of estimating your labor costs, you must not forget to include risks.
The article, in my opinion, is ignorance or misunderstanding of the author of the basic economic principles, forgetting about which he builds his theory.
Theory failure
Judging by the text of the article, the author a priori believes that time for rest and leisure is literally time actually spent in vain. Although he carefully cuts it out of the general theory, saying that such "high matter" cannot be evaluated in monetary terms.
In general, if we continue to develop the chain of sophisms of the author, cited by him in the article, then one can easily come to the conclusion that the feelings and emotions of a person are neurological rudiments. The crown of human evolution will be cyborg.
It would be fun and even fun if the article did not pretend to present a serious life position, with an attempt at its very real economic justification.
')
The article is accompanied by many witty comments from readers. But let's try to make out this theory, pragmatically and seriously, because the problem of “estimating time” is often raised both here and in everyday life.
Economic theory and accounting
How to calculate the cost of your work hour if you are not a hired employee with a fixed salary and the task becomes not so mathematically obvious? (Although in this case it is not obvious).
Questions about the formation of the value of goods and services, the very concept of money - lie at the origins of economic science. Retelling them is long and not interesting.
Consider a person as a production object, and the result of his activity as a product of intellectual labor, which is sold and bought.
Concept of depreciation
A person, like any object of the production process, is a “thing” that wears off. Moreover, the useful life is officially determined (by the state) - this is the retirement age. Like any object, it can exceed this lifetime, but this limitation must be taken into account in the calculations and the formation of the cost per hour of work.
In accounting there is a concept - depreciation .
So, if to speak in the language of accounting, then time for rest and leisure is the means of depreciation of a person. To understand what will happen if you omit this factor, consider the following example from real economic practice.
You were given a machine, announcing that the guaranteed useful life will be 1 year. Then the production capacity will be reduced. Also an important condition is the correct operation of the machine - the fullest possible utilization of its production capacity during the period of work and timely maintenance, repair.
Even under the condition that you properly cared for the machine, it still fails over time, it will need to be replaced with a new one or it will be necessary to make a major overhaul.
Accordingly, if you do not take into account in the pricing (cost) the amount of depreciation deductions, and you do not deduct it from the profit, then after some time you will literally find yourself at the bottom of the trough.
Working hours and non-working hours
Now, I think it is obvious that if you do not take into account the cost of your time for rest, leisure and sleep in the cost of your working hour, the “failure” will not take long to wait. This will manifest itself either in the form of a decrease in labor productivity, or in a disease - a “breakdown”, requiring partial or capital repair, or in death, requiring your complete replacement (as it doesn’t sound cynical).
It follows that the time for the useful exploitation of human labor is limited. Empirically, it is defined on average as 8 hours. For each person, this time is still individual: it can be both less and more, but it certainly should be clearly defined. Once this is done, you can proceed to calculate the cost of your working and non-working time.
As a conclusion
As a conclusion, I would like to consider some of the sophistries from the article: " $ 100 per hour "
The task of the theater and wine
To begin with, it is obvious that the example of wine is incorrect. By virtue of the fact that a person spent non-working time on going to the theater, which means that at that moment his time should have been appropriately evaluated. Those. if the hour of working time is 600 rubles. (A), and your working day is 8 (B) hour, then the hour of your non-working time will be considered as: (A) x (B) / 24, which in this case will be 200 rubles. at one o'clock.
Accordingly, the idea that to return (to spend 30 minutes for a bottle of wine for 287 rubles) will be “expensive” only when your working hour costs more than 1,500 rubles, provided that the 8-hour working day, and provided that the wine you didn’t have to - otherwise you still have to take the time to go to the store and buy another bottle of wine. And this luxury is only possible if your hourly rate is much higher.
Correspondence
Alexey, Unfortunately, I can not come to the meeting; I apologize. Please send screenshots of your system, or give access to the test version, and we will be able to offer you a procedure for further work and deadlines.
Sorry again! Thank you very much for understanding my desire to work for you as efficiently as possible.
If you do not include in the cost of work - trips, negotiations, meetings and possible numerous edits from a client, then obviously you will not be able to provide enough quality service to your client.
The reluctance to meet with the client in the physical ability to do this should alert the client accustomed to good service.
If you begin and end negotiations strictly on the agenda, then most likely you do not know how to negotiate at all.
Work for the idea
The statement that working for an idea is a waste of your own time and money is true only if you have no idea what investment is. Otherwise, you understand that when you are offered to work for future benefits (ideas), then you are offered to invest.
In this case, do not forget that in the process of estimating your labor costs, you must not forget to include risks.
Source: https://habr.com/ru/post/88807/
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