The Costs of Coordination

Sometimes the most mundane subjects can be great illustrations of basic economic concepts. Earlier this week, Alex Tabarrok (George Mason U) blogged about the benefits of coordinating leisure time. I emphasize the word "benefits" because Tabarrok completely leaves out the costs.

He starts off by citing a paper in Sociological Science whose authors find that both unemployed and employed people experience more positive emotions and and fewer negative emotions on weekends. They claim that this is evidence that time is a network good and that everyone benefits by coordinating leisure time.

Tabarrok then complains that his employer's spring break is different from his children's. He says that not only would he and his family benefit from greater coordination of spring break time, but that his employer would as well. After all, this would amount to a free benefit to employees. He ends by advocating a national holiday that would, presumably, benefit everyone. The irony here is that George Mason U is a public school and could quite easily coordinate with the local primary and secondary schools.

If the benefits are so clear, why hasn't this national holiday materialized? The simplest answer is that there are also costs of coordinating in this way. A national holiday would likely mean very high ticket prices at Disneyland and extremely long lines at the rides at Six Flags. Anyone who has ever tried to fly, go to a beach, or head to a nearby amusement park during the two weeks of spring break in mid-March has known the boredom and frustration of sitting in traffic, paying high ticket fees, and waiting in very long lines.

Contrary to Tabarrok's calls for a national holiday, it could be the case that many of us could benefit from less-coordinated holidays. There are, in many areas of the country, plenty of fine days in April and May for visiting popular attractions yet most of us have the same 2 or 3 weeks off in March. The fact that many schools are moving to a non-standard "year-round" school year in which there are several week-long breaks dotted throughout the year is an indication that the costs of coordinating leisure time may be quite high in our present system.

In any discussion of the benefits of some new social arrangement, don't forget to include the costs!