Why is aggregate time value such a vital concept? It defines how societies think about social inclusion on economic terms. Prior to the mid 20th century, there were stronger family links between those who worked directly with local resources, alongside those who gained income from employment. Hence it wasn't always necessary to define time value on strictly monetary terms, to maintain connections with others through the course of a lifetime. As those earlier cultural links slowly faded, citizens became responsible for their own destinies.
This reality - a steadily growing need for economic self reliance - meant new challenges, as production became associated with cities and prosperous regions. Developed nations came to rely on a "consumption based economy" in order to provide services - a pattern which continues to this day. Knowledge based service sectors also developed in ways which proved incapable, of replacing earlier forms of societal coordination. As more citizens were expected not to assist others (marginalized, old and young), pressure only grew for those who remained employed, to somehow provide for the rest. Just as freedoms were lost for those who shouldered the burdens, freedoms were particularly lost for those who were no longer expected to provide.
Since the Great Recession, the worth of aggregate time value is becoming less certain, as policy makers debate whether technology could mean even fewer are needed in the workplace. What too many forget is the fact no society remains stable, when people lose their means to provide for one another. Monetarily speaking, aggregate time value is also nominal income. Are central bankers now hesitant to acknowledge the importance of nominal income, because they believe aggregate time value isn't important to maintain wealth? If so, they are wrong.
However, organizational capacity needs to be approached more directly, so that services product can be locally generated and acknowledged. Otherwise, present imbalances between time based product and other resource capacity in the marketplace, will only grow larger. Lest anyone forget, the human aspect of social exclusion also needs to be taken into account, and reduced wherever possible. Ultimately, reviving time value means believing that people can provide real help for one another, in those moments when institutions forget how to do so.
Fortunately, some of life's pressing issues don't always need an active response, in order to find resolution. This is not one of those times. If citizens do not act in the near future, there is a good chance that the strong growth trajectory which lasted well over a century (here in the U.S.), could be lost. Central bankers need to be more responsive to the monetary nature of time value, and citizens from all walks of life will need real means to contribute, as well. Money is freedom, and this is not the negative that some still imagine.
Hopefully these thoughts will contribute to aggregate time value, as one of the terms in a slowly evolving glossary page for the blog. Recently a friend suggested that I create one. Indeed, the project was already forming in my mind, so her encouragement provided further impetus for me to get started. There are times when I need to provide more concise explanations, for readers who are interested but don't have an economic background or perspective.
P.S. Aggregate time value as a concept is not complete without discussion of human capital. However, a Wikipedia reference for human capital, took a services approach which is quite different from my own, and I plan to respond in the next post.