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“High productivity and high earning rates brought about by modern technologies make it possible for people to work less and enjoy more, yet many continue to work assiduously to earn more.”  Recent research by Christopher Hsee, Jiao Zhang, Cindy Cai, and Shirley Zhang shows that people tend to work the same amount despite incentives but also that good individual personal planning can slow down performance. 

Many people enjoy their jobs and working hard is part of what makes their life fulfilling.  Others recognsie that with uncertainty about the future, squirreling away money can allows you to handle the unexpected .  Lastly, after the tax man has taken his bite, we can pass along wealth so someone or thing will derive a benefit from our labours.  And that can create some incentive to keep working.  But do we work more than we have too?

This question was explored in a paper in the June, 2013 issue of Psychological Science by Christopher Hsee, Jiao Zhang, Cindy Cai, and Shirley Zhang.  They created a laboratory analog to overearning to see whether people would mindlessly earn what they could regardless of what they were able to enjoy later.
The first study in this paper had two parts.  In Phase 1, participants listened to pleasant classical music for 5 minutes. They could press a button to interrupt the music with 200 milliseconds of unpleasant noise.  Every 20 times that they pressed the button, they would receive a bite-sized candy bar. In Phase 2, they listened to another five-minutes of music, and they could eat as many of the candy bars that they earned as they wanted.  They were told at the beginning that any candy they earned but did not eat had to be left behind.  A second group of participants did exactly the same study, except that they had to put in more effort to get each candy.  They had to press the noise button 120 times for each candy bar.
Unsurprisingly, the people who had to put in more effort earned fewer candy bars overall than those who had to put in less effort.  After all, the first phase of the study only lasted 5 minutes.  The people who had to press the noise button 120 times to get each candy bar only earned about 2.5 candy bars on average, and in Phase 2 they ate most of the candy they earned.  The surprising result was that the people who had to put in only a little effort ended up earning about twice as many candy bars as they actually consumed. So, they listened to about twice as much noise as they had to.  In short—they over-earned.  
In some quarters, you could argue that over-earning seems to reflect a lack of planning:  In a second study, some participants were asked to predict how much they would want at the start of the study.  (The prize in this study was jokes rather than candy, but the basic design was similar.) People who could predict how much they would want made pretty good predictions, and they stopped listening to noise as soon as they earned what they wanted.  Those who did not make a prediction in advance overearned.  They earned more jokes than they could listen to later.  Finally, all participants rated how happy they were during the first phase of the study.  Those who made predictions in advance were happier than those who did not.
In a third study, participants had to press a noise bar 10 times for each candy.  One group could earn as many candies as they wanted.  A second group was limited to earning as maximum of 12 candies.  The group that could earn as many as they wanted ultimately earned about 14 candies each.  They only ate about 5 candies apiece, and so they over-earned.  The group that was limited earned only 10 candies apiece and ate about 6 of them. So, they over-earned a bit, but not as much as the unlimited group.  The group that was limited rated themselves as happier overall in each phase of the study than those who were not limited.  Presumably, they were happier both because they got to listen to more of the music in the first phase, and they felt like they wasted fewer candies in the second phase.
Obviously, this result is far removed from the real world.  But, it does have some interesting life implications.  It is possible that many of us spend too much time at jobs we don’t like just to earn toys that we never get to use.  It is worth being more strategic about what we want and what we need to do to get it rather than just mindlessly earning without thinking about what we need those earnings for.  At a minimum, we should stop every once in a while to play.
Abstract from the study

High productivity and high earning rates brought about by modern technologies make it possible for people to work less and enjoy more, yet many continue to work assiduously to earn more. Do people overearn—forgo leisure to work and earn beyond their needs? This question is understudied, partly because in real life, determining the right amount of earning and defining overearning are difficult. In this research, they introduced a minimalistic paradigm that allows researchers to study overearning in a controlled laboratory setting. Using this paradigm, researchers found that individuals do overearn, even at the cost of happiness, and that overearning is a result of mindless accumulation—a tendency to work and earn until feeling tired rather than until having enough. Supporting the mindless-accumulation notion, our results show, first, that individuals work about the same amount regardless of earning rates and hence are more likely to overearn when earning rates are high than when they are low, and second, that prompting individuals to consider the consequences of their earnings or denying them excessive earnings can disrupt mindless accumulation and enhance happiness.

About the authors:
  1. Christopher K. Hsee Booth School of Business, University of Chicago (E-mail: chris.hsee@chicagobooth.edu)
  2. Jiao Zhang School of Business, University of Miami
  3. Cindy F. Cai Antai College, Shanghai Jiao Tong University
  4. Shirley Zhang Booth School of Business, University of Chicago
  1. Christopher K. Hsee, Booth School of Business, University of Chicago, 5807 South Woodlawn Ave., Chicago, IL 60637 E-mail: chris.hsee@chicagobooth.edu
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