National / International News

Opportunity cost and the home

Marketplace - American Public Media - Mon, 2014-05-19 23:40

I met someone recently who bragged that she and her husband had saved hundreds of thousands of dollars over the years because they did all the work around their house themselves. That means yardwork, maintenance, the whole nine.

But did they really save money? What if they ran the numbers on that opportunity cost equation and found they actually lost money?

I'm thinking a lot about this right now, because I bought a new house recently, and there's plenty of maintenance to be done. In fact, right now, there's a guy out back fixing a busted pipe in my sprinkler system. And I’m feeling a bit guilty: Should I be out there fixing that thing? It doesn't look that difficult – all it really amounts to is replacing a piece of broken plastic piping.

The case for outsourcing

  1. I know nothing about sprinkler systems. Nada. Zip.
  2. I have no specialized equipment, or materials, so I’ll have to find out what I need to buy and then go buy it. And then get distracted in the grilling section of the hardware store. And end up spending way more than I really should.
  3. I’ll probably make a mess of it the first time and have to do it over. Plus there’s that vital part that I didn’t get at the store, so I have to make another trip.
  4. It’s what time? Where did the day go?
  5. I didn’t even start writing this blog, and now I might get fired.
  6. My sprinkler guy will take 30 minutes and charge me $50. Boom.

The case for DIY

  1. I’m gaining valuable experience. Once you’ve done something once, whether its stucco, or concreting or sanding a painting a deck, you know what to do, what equipment to buy or lease and how much time it takes. And that investment could mean that every time my sprinklers go kablooey, I have the confidence, know-how and gear to fix them myself in short order, and for next to nothing.
  2. I’m not making any money during the time that the sprinkler guy is fixing my stuff: I’m an exempt employee and I don’t’ get paid overtime.
  3. I get huge satisfaction out of fixing stuff myself. I feel like a provider, a fixer, someone who can be relied on to get things done when things break down. I feel like Magyver. I feel … like a man!
  4. Fixing stuff is fun. Plus you have bragging rights. 

If opportunity cost is "the road not traveled," then the cost of outsourcing is the improvement in my expertise and sense of satisfaction. The cost of DIY, on the other hand is all the time (and maybe money) that I could otherwise spend either making money or relaxing (hey, it's the weekend).

Which means that the opportunity cost calculation of whether or not to outsource household chores becomes a very personal one. People calculate it when they decide whether or not to get groceries delivered, to have a gardener come to work on their yard, or to have their house cleaned by someone else. And a big factor in the decision is how much you enjoy doing those chores yourself. If you really, really hate it, and it takes forever, and you'd enjoy that time so much more doing something else productive or fulfilling or rewarding, then go ahead and outsource.

For a lot of people, of course, there is no question of doing an opportunity cost calculation: they simply don't make enough money to even consider paying someone else to do something for them, so they have to do it themselves. Which means that if you're in a position where you find yourself wondering about opportunity cost, it means you're lucky. Even if it does mean doing some math.

Pope To Travel To Holy Land With Rabbi And Muslim Leader

NPR News - Mon, 2014-05-19 23:33

Pope Francis will head to the Middle East this week to preach peace and has asked two friends from Argentina to accompany him, Rabbi Abraham Skorka and Islamic studies professor Omar Abboud.

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Oklahoma's Latino Community Prepares For The Next Tornado

NPR News - Mon, 2014-05-19 23:31

A devastating series of tornadoes struck Oklahoma a year ago. Hispanics were among the hardest hit by the storms due a lack of preparedness and information available in Spanish.

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VIDEO: Coverage of Oscar Pistorius trial

BBC - Mon, 2014-05-19 23:21
Coverage of the trial of South African athlete Oscar Pistorius, who denies the premeditated murder of his girlfriend Reeva Steenkamp on Valentine's Day 2013.

Ashes whitewash appalling - ECB boss

BBC - Mon, 2014-05-19 23:09
Giles Clarke, chairman of the England and Wales Cricket Board, calls England's 5-0 Ashes loss "appalling and unacceptable".

Poll suggests fracking support down

BBC - Mon, 2014-05-19 23:05
A new survey indicates that support for fracking shale gas in the UK has fallen below 50% for the first time since 2012.

McIlroy in need of some Jimenez momentum

BBC - Mon, 2014-05-19 22:55
Rory McIlroy needs the composure age has offered Miguel Angel Jimenez, writes golf correspondent Iain Carter.

VIDEO: Angelina Jolie on Maleficent role

BBC - Mon, 2014-05-19 22:40
Angelina Jolie talks to BBC Breakfast about her latest role as Maleficent, her humanitarian work and her preventative surgery.

VIDEO: The children visiting WW1 battlefields

BBC - Mon, 2014-05-19 22:38
A project starting on Tuesday will see the government pay for two children from every secondary school in England to visit World War One battlefield sites in Belgium and France.

May hails Abu Hamza guilty verdict

BBC - Mon, 2014-05-19 22:28
The home secretary hails the verdict of a New York court which found radical Muslim cleric Abu Hamza al-Masri guilty of supporting terrorism.

Minister joins yacht search appeal

BBC - Mon, 2014-05-19 22:24
Cabinet minister Jeremy Hunt adds to the calls for the US Coastguard to restart the search for four British yachtsmen missing in the Atlantic Ocean.

School moves on after voyeurism case

BBC - Mon, 2014-05-19 22:09
School leaders say they want to put recent events behind them after a Cardiff deputy head teacher was jailed for five years for secretly filming children in toilets.

VIDEO: World Cup moments: Cynical Carlos

BBC - Mon, 2014-05-19 22:08
BBC Sport counts down 100 of the greatest World Cup moments, as the 2014 tournament in Brazil draws nearer.

VIDEO: Elderly woman airlifted from floods

BBC - Mon, 2014-05-19 22:00
A large international aid operation is under way in Bosnia and Serbia, after the worst flooding there since records began more than 100 years ago.

Careers advice warning to schools

BBC - Mon, 2014-05-19 21:56
Careers advice for pupils in Wales is out of date, too generic and comes too late, especially for those leaving aged 16, school inspectors claim.

Several hurt in major crash on M74

BBC - Mon, 2014-05-19 21:24
Several people have been injured, three of them seriously, in a crash on the M74 involving six cars and two lorries.

Life on street 'claiming lives'

BBC - Mon, 2014-05-19 21:01
At least five homeless people have died in Belfast since the start of the year, say a homeless charity.

Abu Hamza guilty and Van Gaal's pledge - the papers

BBC - Mon, 2014-05-19 21:01
The US terror conviction of radical Muslim cleric Abu Hamza al-Masri features on the front pages with new Man Utd boss Louis van Gaal dominating the back pages.

Victim support head loses job

BBC - Mon, 2014-05-19 20:56
The head of victim support in Northern Ireland loses her job after complaints by current and former staff about how they were treated at work.

Wrongfully jailed man gets apology

BBC - Mon, 2014-05-19 20:39
A man who spent 17 years behind bars wrongfully convicted of attempted rape receives an apology from a body set up to examine miscarriages of justice.
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