Free Time as a Non-market Good: Methods of Its Valuation

Abstract

Market goods, i.e., those which are traded on markets, have their value determined by their price. Price is the main determinant of the decision to buy or sell such a good. Non-market goods, i.e., goods that are not traded on the markets, do not have their price determining their value. However, economics has developed various methods that directly or indirectly determine the value of non-market goods. These methods are used to determine the value of public goods (e.g., national defense) or common goods (e.g., the environment and its values), allowing decision-making on their creation, use or protection. However, free time is a specific non-market good which has its value, which should also be subject to valuation constituting the basis for decision-making on its use. The purpose of the chapter is to analyze the methods of valuation of non-market goods in terms of the possibility of their use in the valuation of free time.