What Is an Hour of Your Life Really Worth?

What Is an Hour of Your Life Really Worth?

G. Monray on putting an economic value on personal time, work–life balance and the hidden cost of unpaid hours

For decades, economics has assigned monetary values to many things that are difficult to observe directly. Companies put a price on capital. Economists estimate the value of environmental resources, travel-time savings and healthcare outcomes. Managers calculate the cost of labour down to the hour.

But one economic resource remains surprisingly difficult to quantify: a person's own time.

In his 2025 paper, “The Economic Value of Personal Time: Toward a Grounded Theory,” Jorge Monray proposes a framework for measuring the monetary value of an individual's personal or free time. Published in International Journal of Independent Research Studies, the paper argues that the value of an hour cannot be determined solely by someone's wage or salary. It also depends on financial pressure, age, family responsibilities, subjective valuation of free time and health.

The resulting Economic Value of Personal Time (EVPT) equation combines six dimensions into an individualized monetary estimate. The paper describes the model as a simplified framework rather than an attempt to establish an absolute or universal value of time.

The idea has implications beyond economics. If personal time can be expressed in monetary terms, organizations may eventually be able to quantify elements of compensation that do not appear on a payslip: flexibility, reduced commuting, additional personal time, work–life balance and the cost of working beyond contracted hours.

An interview with G. Monray

Q: Why did you decide to study the economic value of personal time?

G. Monray: The starting point was a very simple observation: we routinely put an economic value on working time, but we rarely put an equivalent economic value on the time that people spend outside work. An employee may know precisely what their salary is worth per hour. But what is the value of the hour they spend with their family? What is the value of an additional hour of leisure? What happens to that value when the person is 30 rather than 65, has three dependents rather than none, or is under substantial financial pressure? These questions led me to explore whether personal time could be represented through a monetary metric.

Q: Isn't the obvious answer simply the person's hourly wage?

G. Monray. Not necessarily. The wage gives us an important market-based opportunity cost. If someone earns €2,000 per month and works 160 hours, the straightforward opportunity cost is €12.50 per hour. But that tells us what the labour market pays for the person's working time. It does not necessarily tell us what that person considers an hour of personal time to be worth. The distinction is important. The same €12.50 hourly wage can correspond to very different personal circumstances. One individual may have significant debts and family responsibilities. Another may have substantial financial security. One may strongly prioritize leisure; another may prioritize work and career progression. The model therefore starts with opportunity cost but does not end there.

Q: So the central concept is that time has both an objective and a subjective value?

G. Monray. Exactly. Some components can be observed relatively objectively: income, hours worked, debt, net worth and age. Other dimensions are inherently more personal: how someone values their free time, their family responsibilities and their perception of their health. The research therefore deliberately combines objective economic variables with subjective variables. That is one of the reasons I call it a grounded theory rather than presenting it as a universal law of economics.

Q: What theoretical traditions did you draw upon?

G. Monray. The framework brings together several traditions. The first is opportunity-cost theory, particularly the idea associated with Gary Becker that time is a scarce resource and that allocating an hour to one activity means giving up another possible use of that hour. The second is welfare economics, where well-being extends beyond income to include quality of life, health and relationships. The third comes from the psychology and behavioral economics of time and life satisfaction, where individual perceptions of time influence preferences and decisions. The intention was to connect these different perspectives into an operational economic framework.

Q: How did you develop the six variables in the model?

G. Monray. The research followed an inductive approach.Because there was no single established framework capable of integrating all these dimensions into one monetary measure, I reviewed multidisciplinary literature across economics, psychology, health and work–life balance.

The paper describes searches using Scilit and Google Scholar. In the Google Scholar exercise, the search term “economic evaluation of time” was used for English-language journal articles from 2015–2025, producing 159 results, of which 74 were selected for relevance. A qualitative data-analysis process was then used to identify recurring concepts. The six dimensions emerged from this process.

Q: What are those six dimensions?

They are:

• 1. Opportunity cost, essentially the individual's income per hour.

• 2. Personal financial pressure, including the relationship between outstanding debt and net worth.

• 3. Age, reflecting the changing scarcity of remaining lifetime.

• 4. Family burden, including dependents and family responsibility.

• 5. Subjective valuation of free time, how much an individual personally values non-working time.

• 6. Current health, reflecting the individual's ability to enjoy and use personal time.

The equation combines these dimensions through additions, multiplication and adjustment factors.

Q: Why should age increase the economic value of personal time?

G. Monray. Because time is ultimately a scarce resource. When someone is young, the individual generally has a much larger amount of expected future time available. As age increases, the remaining lifetime becomes shorter. The model therefore introduces an age factor that increases as the individual's age approaches the assumed maximum life expectancy.

There is also a behavioral dimension. Research in psychology and economics suggests that perceptions of time change with age, and that emotionally meaningful experiences can become increasingly important. The model tries to capture that changing scarcity mathematically.

Q: What about family responsibilities?

G. Monray. Family is another dimension that conventional hourly wage calculations cannot capture. Imagine two employees earning exactly the same salary and working exactly the same number of hours. One has no dependents. The other has three children and substantial family responsibilities. The monetary opportunity cost of their working time may be identical, but the consequences of losing an additional hour of personal time can be very different.

The model therefore includes a Family Burden Factor, with the proposed equation increasing the value of time according to the number of dependents and the degree of family responsibility.

Q: The subjective valuation of free time is perhaps the most unusual component. How can something subjective enter an economic equation?

G. Monray. Economics already incorporates subjective preferences in many areas. Utility is subjective. Willingness to pay is subjective. Consumer preferences are subjective. The fact that something is subjective does not automatically make it unmeasurable. The challenge is to convert the subjective assessment into a transparent and reproducible input. The paper therefore proposes a factor representing how highly an individual values personal time relative to working time.

For example, if someone considers their free time twice as valuable as their working time, the proposed subjective factor can be set at 2. The important point is that the individual becomes the primary source of information about their own subjective valuation.

Q: Health creates an interesting paradox in the model.

G. Monray. Yes, and it was one of the more difficult conceptual issues. At first glance, good health should increase the value of personal time because a healthy person is better able to enjoy it. But there is an alternative interpretation.

If someone becomes seriously ill, their available usable time becomes more scarce. In that sense, scarcity could increase the subjective value attached to each remaining hour.

The paper discusses both interpretations and ultimately uses an inverse health factor in the proposed formulation. This is explicitly presented as a conceptual issue rather than a settled empirical relationship.

Q: Can you give a simple example of how the model changes the conventional view of an employee's hourly cost?

G. Monray. Consider an employee whose market opportunity cost is $15 per hour. Under a simple wage calculation, an additional hour of work costs the employee $15 in terms of forgone alternative time. But suppose the individual's personal time is valued at approximately twice that opportunity cost. The model would represent the economic value of personal time at around $30 per hour, before incorporating other adjustments.

That creates an important distinction: The employer's labour cost and the employee's economic cost of giving up personal time are not necessarily the same number. This is particularly relevant when organizations ask employees to work additional hours without additional compensation.

Q: You use unpaid work-from-home hours as an illustration. Why is that important?

G. Monray. Because remote work can make the boundary between working time and personal time much less visible. Suppose an employee is contracted to work 160 hours per month at an opportunity cost of $15 per hour, but actually works 260 hours because another 100 hours are performed from home without compensation. From the company's perspective, those additional hours may appear inexpensive or even costless. From the employee's perspective, however, those 100 hours are not free. They displace personal time.

Using the illustrative parameters in the paper, the company's nominal saving from those 100 additional unpaid hours would be $1,500, while the employee's calculated personal-time cost could be $3,000 when the illustrative EVPT is $30 per hour.

The example illustrates a potentially important asymmetry: the financial cost to the company and the economic cost to the employee can be very different.

Q: Does that mean companies are effectively providing additional compensation when they offer flexibility?

G. Monray. Potentially, yes—but that requires an important distinction. If a company gives an employee greater flexibility, eliminates commuting time or allows work to be organized around personal responsibilities, the employee may receive an economic benefit even though that benefit does not appear as salary.

The same principle works in reverse. If a company requires employees to sacrifice additional personal hours, travel extensively or work outside contracted hours, the employee may bear a hidden economic cost that is not reflected in the nominal salary. This is where the model could become relevant to human-resource management.

Q: Could this eventually change the way companies think about compensation?

G. Monray. That is one of the potential applications.Traditional compensation analysis tends to concentrate on financial salary. But total employee value can also include flexibility, commuting time, remote work, additional working hours, personal autonomy and work–life balance. If these components can be translated into economic values, organizations may eventually be able to compare different forms of compensation more systematically.

For example, a company could ask whether an additional €5,000 in salary or a substantial reduction in commuting and working-time burdens creates greater perceived economic value for a particular employee.

The equation provides a conceptual starting point for making such comparisons.

Q: Does the model imply that everyone's time has a different monetary value?

G. Monray. Yes. And that is actually one of its central premises. Two people earning the same salary can have different EVPT values because they can differ in age, financial pressure, family responsibilities, health and subjective preferences.

The value can also change for the same person over time. A person's economic situation at 30 may be completely different at 50. Their family responsibilities can change. Their health can change. Their income can change. Therefore, EVPT is not intended to be a permanent personal price tag. It is a time-specific economic estimate.

Q: Is the equation intended to establish the “true” value of someone's time?

G. Monray. No. This is an important calrification. The paper explicitly describes the formula as a model, not as an attempt to discover an absolute truth. Its purpose is to provide a structured numerical representation of a concept that otherwise tends to remain abstract.

The next step for research is empirical testing. A theoretical framework becomes substantially more useful when researchers can test its assumptions with larger datasets, compare its outputs with observed behavior and examine whether the proposed relationships hold across populations.

Q: So where does the term “grounded theory” come from?

G. Monray. The idea is that the framework was constructed inductively from observations and concepts emerging from multidisciplinary literature rather than imposed entirely from an existing mathematical theory.The research began with an under-structured question—how should we measure the economic value of personal time?—and progressively identified dimensions that appeared relevant.

The equation was then constructed from those dimensions. It is therefore better understood as a proposed theoretical and applied framework requiring further empirical development, rather than as a completed empirical theory.

Q: What could the model ultimately mean for HR managers? It could provide a language for discussing the economic value of work–life balance. HR departments routinely measure salaries, turnover, absenteeism and productivity. But the value of personal time is usually discussed qualitatively.

An EVPT-type metric could potentially allow managers to examine questions such as:

• What is the economic cost of excessive overtime?

• What is the value of eliminating commuting time?

• What is the employee's economic benefit from flexible work?

• How much personal-time value is being transferred to employees through remote work?

• What happens to that value when unpaid work expands?

The paper argues that numerical representation could make these issues more visible to managers and employees.

Q: What is the larger economic idea behind the research?

G. Monray. The larger idea is that time is a scarce economic resource, not merely a unit on a clock. Traditional economic calculations tend to be very good at measuring things that have an explicit market price. Personal time is different. Its value emerges from opportunity cost, scarcity, preferences, family circumstances, health and the stage of life. The challenge is therefore to move from saying “work–life balance is important” to asking a more precise economic question: “How much is that balance actually worth?”

That is the question the EVPT framework is designed to explore.

The significance of this research lies in an attempt to connect two worlds that are often treated separately: microeconomics and human-resource management. Economics already recognizes that time is scarce and that allocating time to one activity means sacrificing another. Monray's contribution is to propose a broader individualized metric that incorporates not only opportunity cost but also financial pressure, age, family responsibilities, subjective preferences and health.That opens an interesting managerial possibility.

If personal time has an economic value, then flexible working arrangements may represent something more than an employee benefit. They can potentially be understood as a form of non-cash economic compensation.

Likewise, unpaid overtime, excessive commuting or work performed outside contracted hours may represent an economic cost transferred from the organization to the employee.

The research's illustrative work-from-home example makes this particularly visible: the same 100 additional hours can look relatively inexpensive from the employer's accounting perspective while carrying a much larger calculated personal-time cost for the employee.

The conceptual leap is therefore straightforward: salary measures what an organization pays for labour; EVPT attempts to measure what an individual's time is worth when it is taken away from personal life.

That distinction could become increasingly relevant as organizations rethink flexible work, remote work and the meaning of total compensation.

Publication

Monray, J. (2025). *The Economic Value of Personal Time: Toward a Grounded Theory.* International Journal of Independent Research Studies, 14(5), 33–46. DOI: 10.55220/2304-6953.v14i5.827. The journal records the paper as published in Volume 14, Issue 5, 2025.

The working-paper version was posted on SSRN under the title The Economic Value of the Personal Time – A Grounded Theory, dated December 16, 2025; SSRN records a later revision in April 2026.

Methodological note: The paper proposes and justifies the EVPT framework; it does not constitute a large-sample empirical validation of the equation. Its numerical examples are illustrative. Future empirical research would be required to establish the model's predictive validity, calibration and robustness across individuals, occupations, countries and demographic groups.