In 1930, economist John Keynes predicted we'd only work 15 hours a week - here's one theory why he was wrong

In 1930, British economist John Keynes wrote an essay called "Economic Possibilities for Our Grandchildren." In the essay, he made the now-famous assertion that his grandchildren's generation (meaning people in the workforce today) would only work 15 hours a week.

Needless to say, Keynes was wrong - especially about Americans. The OECD estimates that Americans logged 34 hours a week in 2010, and that's including part-time workers. Gallup reports that the average full-time American put in nearly 47 hours a week in 2014.

On a recent episode of Planet Money, hosts Robert Smith and David Kestenbaum discussed why Keynes was so far off-base - and what really motivates us to work so much.

One guest on the show was Richard Freeman, Ph.D., a professor of economics at Harvard University. In a book chapter titled "Why Do We Work More Than Keynes Expected?," Freeman explains the increase in work hours through the substitution effect. On the Planet Money episode, the hosts put Freeman's theory into simpler terms.

The substitution effect is the opposite of the wealth effect. According to the wealth effect, when people get rich, they can afford more leisure time.

But according to the substitution effect, the hosts explain, "the more money you earn, the less likely you are to indulge in leisure." That's because your time at work is worth more than a lower-income person's time at work.

The hosts offer an example: If there's a choice between going to the beach and going to the office, someone who earns $400 a day might opt to go into the office. Presumably, someone who only earns $100 a day might head straight for the beach.

"Which is more valuable?" the hosts ask. "Working or what I'm gonna do when I'm not working?"

One result of the substitution effect, as Freeman observes in "Why Do We Work More Than Keynes Expected?": In the second half of the 20th century in the US, "the workaholic rich replaced the idle rich." Instead of poorer people working more than wealthier people, the opposite became true.

As for whether we should rue the reversal of this trend in work hours, Freeman doesn't think so.

In the book chapter, he writes, "thank heavens Keynes was wrong about the strength of human devotion to work. There is so much to learn and produce and improve that we should not spend more than a dribble of time living as if we were in Eden."