Stop Premature Obsolescence: LessTrash, Fewer Working Hours, Same Pay
arXiv:2607.28371
The paper models how policies that curb the throwaway economy can create a productivity boost in one sector and, under certain conditions, allow a reduction in working hours without lowering consumer welfare, wages, or profits.
Abstract
About a century ago, Keynes predicted that, thanks to technological progress, today's working week would be reduced to 15 hours. In practice, however, large technological gains seem to have been offset by a substantial shortening of product lifespans. From a standard microeconomic perspective, this is inefficient as more labour and material resources are employed than necessary to deliver a given level of product-provided services. In this paper, we model policies aimed at reducing the current 'throwaway economy' as inducing a positive productivity shock in one economic sector and examine the conditions under which this shock's propagation to other sectors can allow for a reduction in working time, without reducing consumers' well-being, labour compensation, or profits. To this purpose, we first focus on a stylized three sector