Modern WisdomThe Behavioural Economics Of How We Spend Our Time | Koen Smets | Modern Wisdom 127
Chris Williamson and Koen Smets on why Time Isn’t Money: Behavioral Economics Of How We Spend It.
In this episode of Modern Wisdom, featuring Koen Smets and Chris Williamson, The Behavioural Economics Of How We Spend Our Time | Koen Smets | Modern Wisdom 127 explores why Time Isn’t Money: Behavioral Economics Of How We Spend It Chris Williamson and behavioral economist Koen Smets explore time as our scarcest resource and why we systematically undervalue and mismanage it compared to money. They discuss concepts like opportunity cost, mental accounting, and deadlines, applying them to work, commuting, meetings, and personal life. Smets argues that awareness and deliberate planning of time can reveal hidden costs, improve decision-making, and reduce wasted effort—both individually and within organizations. They also examine experiments on speeding fines and charitable giving to show how people perceive the value of time versus money.
At a glance
WHAT IT’S REALLY ABOUT
Why Time Isn’t Money: Behavioral Economics Of How We Spend It
- Chris Williamson and behavioral economist Koen Smets explore time as our scarcest resource and why we systematically undervalue and mismanage it compared to money. They discuss concepts like opportunity cost, mental accounting, and deadlines, applying them to work, commuting, meetings, and personal life. Smets argues that awareness and deliberate planning of time can reveal hidden costs, improve decision-making, and reduce wasted effort—both individually and within organizations. They also examine experiments on speeding fines and charitable giving to show how people perceive the value of time versus money.
IDEAS WORTH REMEMBERING
5 ideasTreat time as your primary scarce resource, not just money.
Everyone gets the same 24 hours regardless of wealth, and once a minute is gone it cannot be banked or reused—so decisions about how to spend it are often more consequential than small financial choices we obsess over.
Make opportunity cost of time explicit in everyday choices.
Whether it’s driving 20 minutes to save a little on fuel or sitting in traffic daily, we rarely calculate what else we could be doing with that time; consciously asking “what am I giving up by doing this?” can change decisions quickly.
Use “mental accounting” for time to protect what matters.
Just as people create virtual pots for money, you can earmark blocks of time for deep work, rest, or family and treat those blocks as non-fungible instead of letting any random task expand to fill them.
Recognize and reduce invisible time-wasting externalities at work.
Decisions like over-negotiating with suppliers or calling unnecessary meetings can consume colleagues’ time without any clear ‘price tag’; building awareness of these knock-on effects can improve collaboration and productivity.
Design consequences to be timely and salient, not abstract.
The Estonian speeding experiment—offering drivers a choice between a €400 fine or waiting an hour—ties the punishment to the immediate time-cost of speeding, likely making behavior change more durable than delayed monetary fines.
WORDS WORTH SAVING
5 quotesWe either use time or we lose it.
— Koen Smets
At work, we treat our time as sunk—we’ve sold it to our employer.
— Koen Smets
Everybody, rich or poor, gets 24 hours a day. You don’t get 36 hours because you’re rich.
— Koen Smets
If we didn’t set ourselves deadlines, I’d have long given up posting a piece every week.
— Koen Smets
There’s no limit to how much money we can have, but we all have limited time—so it’s easier to imagine giving up a week than giving up a fortune.
— Koen Smets
QUESTIONS ANSWERED IN THIS EPISODE
5 questionsHow would your daily schedule change if you priced each hour of your time as highly as the Estonian drivers who chose to pay €400 rather than wait an hour?
Chris Williamson and behavioral economist Koen Smets explore time as our scarcest resource and why we systematically undervalue and mismanage it compared to money. They discuss concepts like opportunity cost, mental accounting, and deadlines, applying them to work, commuting, meetings, and personal life. Smets argues that awareness and deliberate planning of time can reveal hidden costs, improve decision-making, and reduce wasted effort—both individually and within organizations. They also examine experiments on speeding fines and charitable giving to show how people perceive the value of time versus money.
In what areas of your work or life are you creating hidden ‘time externalities’ that silently waste other people’s time?
If you mentally ‘budgeted’ your time like money, which activities would you cut, and which would you protect more fiercely?
Where are your self-imposed deadlines leading you to accept worse outcomes when a slight delay could dramatically improve quality?
When you next donate to a cause, would giving time instead of money better reflect your values—and how would others perceive that choice?
EVERY SPOKEN WORD
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