The Drew Bledsoe paradox: the mysterious home economics of homo economicus
When Drew Bledsoe (then the quarterback of the New England Patriots) decided to build a home for himself, his economic advisors had to explain to him that the millions he was about to spend would never come back to him. This is because the people who bought his house would be buying it for the land alone. They would knock Drews palace down, and build anew. Everyone who owns this property, in fact, knocks down and starts fresh. None of them recapture the millions they spend on their homes.
Drew was apparently puzzled. So should we all be. Homo economicus, economic man, is not supposed to act like this. To “invest millions of dollars in a “property, and then have to walk away from it this is not the rational thing to do. (It is especially not rational when you are an NFL quarterback who may discover on any given Sunday that the caprice of an owner or a coach obliges him to pick up and pursue his career on the other side of the country. But never mind, almost everyone who spends this kind of money on a house lives a fluid life that can demand sudden relocation and this cataclysmic loss.)
The Bledsoe paradox does not hold only for the very wealthy. It is a truism of home renovation that the renovator will not recapture all (in some cases, any) of the value of the money they spend on their renovations. They might think about a new kitchen and deck as an improvement that must increase the value of this property. But theyre wrong. They are about to sacrifice hard-won savings to the Bledsoe paradox.
How should we think about this? We might say, “well, no, the money people put into their homes or their renovations is not meant as an investment. People spend this money to make themselves comfortable. They are spending for the moment, not the long term. It is an investment in happiness, not the real estate market.
Lets run the numbers, shall we? Lets say that Bledsoe spend 3 years in his house before moving to Buffalo and that he spend $2 million on house construction. The happiness fee here was around $650,000. Thats $220,000 a year, around $20,000 a month. What about the more usual home owner? Lets say the average renovation is $100,000 and that people spend an average of 3.5 years on their homes. Here the happiness fee is roughly $3000 a month or a hundred dollars a day. (An anthropologist with a calculator is a dangerous thing; better check these numbers.)
The opportunity cost is itself quite high. If the renovators had invested the $100,000 intelligently in the stock market of the middle 1990s, they could have retired by decades end. The inconvenience cost is high too. Ask any homemaker what its like to put up with commotion, dirt, and a missing kitchen for 4 months, and s/he almost always says, “we will never do it again. That there is an inconvenience cost should make us suspicious of the happiness argument. If happiness were truly the objective, this family could treat themselves to lavish hotel life every weekend and still put money in their pockets.
The socio biologists will no doubt say that we rebuild or renovate to claim the property. The notion here, to put it somewhat crudely, is that this investment is our species way of peeing in the corners. As usual, this argument is a blunt instrument which fails to explain most of the data at hand. Are we to understand that the construction of a vast faux Tudor and a monument to modernism have exactly the same motive? Are we to understand that the hundreds of little decisions that people agonize over when building or renovating are really just a false consciousness. French drapes, glazed windows, open skylights, its all really just pee. But there is a simpler question, one that sociobiology cannot reckon with: why dont we just actually pee in the corners?
Lets imagine we have done our anthropological homework. We have interviewed Mrs. Maison about the new renovation she and her husband just completed on their three year old home. They tore off the back of the house and replaced it mostly with glass. Light now pours in. When we ask Mrs. X why she went to such great expense and inconvenience, she says,
“Well, you see, my husband just loves the light in the morning. Me, I would sleep until noon, if you let me, but Franks a morning person and he loves to get up and pad around in the first light of the day. Its his quiet time. Its his thinking time.
This is a charming statement of wifely solicitude but its also wrong. When we talk to Mr. Maison, he doesnt talk at all about morning light. He talks about space and openness and being able to see the garden. When we gently prompt him about mornings, he says, “Oh, that. Yeah, I know. My wife keeps saying that to everybody, and its partly true. I mean I am a morning person, and the house is way nicer in the morning. But I liked it before. I mean in the winter months, there really isnt any light.
Homo economicus meet homo faber (man the maker). The reason Mr. and Mrs. Maison spent $180,000 on this renovation was to capture an idea Mrs. Maison has of her husband, and, more important, to create the idea she has of her husband. He works too hard, she thinks. He has so many demands made of him. If only he had a little more time to himself. If only he could be bathed in the light of the morning, maybe This is a more complicated species of wifely solicitude. It is Mrs. Maison crafting the home to craft her husband.
The Bledsoe paradox proves not to be a paradox at all. We invest in our homes (when we have the good fortune to have homes and money enough to remake them) because they are transformational opportunities. We make them to make ourselves. This is money well spent when it works. Its badly spent when the idea we are trying to invent for and of ourselves is implausible or otherwise uninhabitable. It does not fit very well with our notions of economic man, of ourselves as rational creatures who invest for future profit. But thats only because homo economicus is defined too narrowly. It would help a little if we would see that some economic activities are also cultural ones (the reverse is also true), that we undertake these activities especially when we want to cast our ideas out into the world in the hopes that they will “discover us there and take up residence.
In a sense, the paradox comes from a paradigm. Economic man is a robust part of who we are, but only a small part of who we are. When we case this idea out into the world, we are sometimes puzzled by the creature who turns up at our door.