by Tino Sanandaji
American Enterprise Institute
August 05, 2014
One factor that is often overlooked in the debate over causes of income inequality is a shift in the distribution of working hours. The rich now work more than the poor. Not only does working more hours translate into making more money, but it translates into making exponentially more money. Firms generally pay extra for working overtime, and people who keep longer hours tend to be promoted more often into high-paying positions. High-paying jobs also tend to require greater skills, more education, or proficiency with certain advanced technology. A low income is the economy’s way of signaling that certain work is not very valuable for society. Yet there are non-monetary motivations for work. Work adds meaning and value to the life of the worker. The economic challenge of our time is not to produce enough goods, but to find rewarding, fulfilling work for everyone.

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