Tuesday is Free Cone Day at Ben & Jerry's ice cream parlors — an event that for 37 years has enticed people to stand in long lines for something they'd otherwise pay only a few dollars for.
And, Free Cone Day grinch that I am, I started to wonder: How much is that time really costing you? Even if you don't pay for the ice cream itself, you're paying for the time you spend standing in line to get it. Economists call this opportunity cost — the value of something you're giving up in order to pursue another option.
When you do the math, though, free ice cream wins. It turns out it's actually a pretty good deal.
How do you measure the value of an hour of your life?
Let's assume you went at peak time and waited for half an hour. How much is that worth to you?
The easiest way to figure this out is to calculate what you'd get paid for the half-hour you spent standing in line for ice cream. For the typical American worker, that would be $8.70 — a little bit more than the price of just buying a scoop of ice cream somewhere else.
If you're well paid, of course, your time is worth quite a bit more: $16 for a half-hour for a nurse, $28 for a lawyer, $49 for a doctor. (Just over $9 for a reporter, according to data from the Bureau of Labor Statistics.)
Lines at Free Cone Day can stretch for blocks, but they often move pretty fast. Last year the Daily Gazette in Saratoga Springs, New York, did the math and discovered the Ben and Jerry's there could move 13 customers per minute — meaning that even a long line could move through in 10 minutes or less.
That's on par with reports from other cities that found, on average, Ben and Jerry's hands out at least a few cones per minute. Still, half-hour wait times aren't unheard of, and many people go for their free cone expecting to wait. The company even promotes it as part of the experience. So a half-hour wait seems like a fair assumption.
The federal government thinks your leisure time is worth $12.90 per hour
For most people, though, standing in line for an ice cream cone isn't quite such a direct trade-off. A doctor isn't going to get $49 less in her paycheck because she took a half-hour of her day to stand in line for ice cream.
So how much is your time worth if it's not time you were going to use to earn money? Believe it or not, the federal government has an exact answer for you: $12.90 per hour.
And using that estimate — which is half of what a typical American household earns in an hour — then the half-hour you spent standing in line for a free ice cream cone was only worth about $6.45 to you in the first place.
The federal government's estimate assumes people value their leisure time slightly less than the time they spend doing business, since time traveling when you have spare time anyway isn't necessarily time you'd otherwise use to make money.
The government cares quite a lot about the value of people's time because it's used in cost-benefit analyses of changes to transportation networks. If a new road saves commuters a few minutes sitting in traffic, how much is that worth? That's why governments are constantly researching and refining the way they value their citizens' time.
And the question of how much your time is worth matters to individuals for much more than just ice cream cones. Are you willing to add a layover to a cross-country flight to save $50? What about $500? What if you were bumped off the flight you were planning to take?
Getting free stuff is valuable too
Even if the federal government is right, and a half-hour of leisure time is only worth $6.45, that's still more than it would have cost to just buy the ice cream cone another day and use the time to do something more fun than standing in line.
But the cold economics of the value of time don't allow for the joy of getting something for free that you'd otherwise have to pay for. And, yes, there's psychological research to back up the commonsense conclusion that people love free stuff.
In a paper written at the Massachusetts Institute of Technology in 2006, Kristina Shampan’er and Dan Ariely argued that people like free stuff so much that they don't just think of it as a smaller price to pay, but as an added benefit.
According to Shampan'er and Ariely's research, a free ice cream cone isn't the same as an ice cream cone you paid for — it's better. And that means that wasting your time standing in line for it might mean you're still getting a pretty good deal.