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Study of the Wealthy Confirms Classic Joke

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Money Money MoneyThe Washington Post story today, discussing the findings of Nobel Prize-winning (2002 Nobel Prize in Economic Sciences) behavioral economist Daniel Kahneman, confirmed the classic joke of an American businessman and a Mexican fisherman. You’d think that the more you earn, the more out of life you’d be able to enjoy; however that isn’t the case. More and more studies are showing that happiness has less to do with money and more to do with other factors. First the (not so surprising) findings, then the ironic joke.

Findings

Kahneman found that wealthy individuals, those earning more than $100,000, spent less than one-fifth of their time in passive leisure. Those earning less than $20,000 a year, spent more than a third of their time in passive leisure. The rich spent more of their time doing the required things, such as working, and less of the optional things because they’re trapped in a mental illusion. They focus on getting rich because they believe that when they are rich, they can buy some cool electronics or get daily spa treatments… therein lies the joke. If you want more Kahneman, here’s more goodness on the aspiration treadmill.

Living the American Dream

Fishing Boat
An American businessman was standing at the pier of a small coastal Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellowfin tuna. The American complimented the Mexican on the quality of his fish.

“How long it took you to catch them?” The American asked.

“Only a little while.” The Mexican replied.

“Why don’t you stay out longer and catch more fish?” The American then asked.

“I have enough to support my family’s immediate needs.” The Mexican said.

“But,” The American then asked, “What do you do with the rest of your time?”

The Mexican fisherman said, “I sleep late, fish a little, play with my children, take a siesta with my wife, Maria, stroll into the village each evening where I sip wine and play guitar with my amigos, I have a full and busy life, señor.”

The American scoffed, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds you buy a bigger boat, and with the proceeds from the bigger boat you could buy several boats, eventually you would have a fleet of fishing boats.”

“Instead of selling your catch to a middleman you would sell directly to the consumers, eventually opening your own can factory. You would control the product, processing and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually NYC where you will run your expanding enterprise.”

The Mexican fisherman asked, “But señor, how long will this all take?”

To which the American replied, “15-20 years.”

“But what then, señor?”

The American laughed and said, “That’s the best part. When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions.”

“Millions, señor? Then what?”

The American said slowly, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take a siesta with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos…”

###

Touché.

How Rich People Spend Their Time [Washington Post]

(Money by Tracy O, Fishing by xul)

{ 11 comments, please add your thoughts now! }

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11 Responses to “Study of the Wealthy Confirms Classic Joke”

  1. fred@opc says:

    I love this article. It is absolutely true. I, for one, am the ‘harvard mba’ in this story… and I often wish I weren’t.

  2. Great. Now I want to be a Mexican fisherman.

  3. Kristin says:

    This is another classic “make the data fit the desired outcome”.

    Evidently it is necessary to state the obvious: Hard work leads to wealth while leisure/laziness leads to earning less.

    If you are truly successful in life and have found your niche then your work will be enjoyable.

  4. Kristin: It’s worth pointing out that hard work doesn’t always lead to wealth, and sometimes lazy people get rich. I work hard at what I do, and we’re doing quite well financially. However, I know many people who work far harder than I do and aren’t doing as well. I think it’s more a matter of working smart than working hard.

  5. I agree with FCN that working harder might not lead to larger paychecks. It’s “working” smart that really makes you better off.

  6. Moneymonk says:

    We all have enough to sustain our needs, it’s our wants that makes us work like a slave

  7. Great article. I think the key is to find something you enjoy doing and make money doing that. That way your work time is your leisure time.

  8. Oooooh, i like that one! never heard it before, but it’s definitely something to ponder. I sorta feel that way coming to work to be honest – pretty laxed environment to do things such as leaving this little comment ;)

  9. Meg says:

    I too think that they chose the data set that makes the point they want to make. It seems really arbitrary to me to compare those earning less than $20K to those earning more than $100K.

    Also, you really have to be careful differentiating between “leisure activities” and “obligatory activities” like work. Lots of people truly enjoy their work and get fulfillment from it. And some “leisure” activities such as watching TV, getting drunk, or sleeping away the day might not really be worth bragging that you spend a third of your waking hours getting to do them.

    Besides, am I really supposed to think it might be preferable to have loads of free time and live on a poverty level wage than to make a 6 figure income and still get to spend 20% of my time doing whatever I want? There’s nothing wrong with not having a big income, but making less than $20K in most places in America is extreme.

  10. Bolton(UK) says:

    with regards to those who say work leads to money, and laziness (and id like to point out that if you arent employed, this does NOT make you lazy) leads to no money, what about homemakers, etc? for example I work a low paid part time job – I am far from lazy, I am a full time carer for my wife, and primary care giver to three young daughters – that is harder work than the days when i used to work 100-120 hour weeks. And as for riches… well ask yourself who in the story is truly better off? I work damn hard 24-7 with my family as well as 20 hours a week in employment, and firstly we are financially stable, and secondly, I get to spend more time with my family and watching my daughters grow up. nd to add to this I am only 21 years old. And hats off to the stay at home mum n dads that really do the hard work!!

    • jim says:

      I don’t think anyone would say that a homemakers, whether it’s a stay at home mom or dad, are lazy… I know I certainly would never say that. Raising your kids has to be one of the most challenging and rewarding “jobs” anyone can have.


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