Disney Vacation Club Info

Disney Vacation Club - A guide to DVC, disney time share point charts and dvc resales The Internet's Largest Unofficial On-Line Guide to Walt Disney World Site Map Search Theme Parks Cruise Line Discounts Dining Photo Gallery Recreation Disney Hotels Downtown Disney DVC/Timeshare Forums/Chat Transportation Ratings/Reviews Home Page Photos/Video Theme Parks Magic Kingdom Epcot MGM Studios Animal Kingdom Tickets Park Hours/Shows Park Maps Events more.... Resorts/Hotels Disney Resorts Hotel DIScounts Rack Rates Resort Maps Reservations more.... Discussion Forums Ratings/Reviews Abbreviations FAQ's Posting Guidelines Free Registration Disney Cruise Line Itineraries Activities Dining Staterooms Discounts more... DVC/Timeshare DVC Resales DVC Resorts Newcomers FAQ DVC Point Charts Rent/Trade Points Discounts Current Discounts Disney Cruise Line Package Discounts Resort Discounts more... Disneyland CA Theme Parks Accomodations Dining Discounts more... Dining Menus Dining Database Priority Seatings more... Downtown Disney Cirque du Soleil Disney Quest Marketplace Pleasure Island West Side more... Transportation Town Car Service Bus Schedules Monorail Driving to Florida more... Recreation Golf Courses Parasailing/Skiing Richard Petty more... Community Discussion Community Photos Countdown Clock DIS Team more... Upcoming Events Universal Studios The DIS - Disney Vacation Club Info The #1 Disney Vacation Club Reseller in the World!! DVC Main Page DVC Resales Points Calculator Points Chart Rent/Trade Points Rent/Trade FAQ'S DVC FAQ'S DVC Resorts at WDW Room Reports DVC Discussion DVC Frequently Asked Questions Deciding to join the Disney Vacation Club is a big decision. We all went through it, and we had a thousand questions in the process. One of the goals for this web site was to try and answer as many questions as possible here. The DVC bulletin board is also a great source of information (you can reach that board by selecting BOARDS from the menu bar to the left). What are the benefits of membership? How does the point system work? How do I know how many points to purchase? Can I use my points at other resorts? What if I decide not to keep it? What should I know about buying timeshares through a resale company? Still have Questions? What are the benefits of membership? There are a number of benefits to joining the DVC. First, the value of the points that you purchase will never change. The same value you receive today, will be the same value you receive in 30 years. While the cost of staying at a Disney hotel rises by 5-10% per year, this is a great hedge against inflation. Members also receive discounts at Pleasure Island and Disney Water Parks as well as 10% off merchandise at The Disney Store nationwide. DVC offers discounts for a variety of WDW restaurants, recreational programs and tours. A complete list is provided to members when they check in at their resort. Members also receive a 10% discount on Unlimited Park Hopper passes, that allow unlimited admission to all WDW Theme Parks, Water Parks, Pleasure Island and Disney Quest for every day of your stay. These passes must be purchased at a DVC resort during your stay. You also have the benefit of being able to book at your home resort up to 11 months in advance of your check out date. Your home resort is the resort at which you purchased your interest. Current DVC resorts are Old Key West (OKW), Boardwalk Villas (BWV), Vero Beach (VB), Hilton Head Island (HH), Villas at Wilderness Lodge (VWL), Beach Club Villas (BCV) and Disneys Saratoga Springs Resort & Spa is due to open in May, 2004. You can reserve up to 7 months in advance at any DVC location that is not your home resort. Membership in DVC is included with ownership at a DVC Resort. The program is currently scheduled to end on January 31, 2042- for OKW, BWV, VWL and BCV. After that date, the present resorts will revert back to Disney ownership. Ownership rights may be transferred to others in a will or by a direct sale, after consult with DVC. DVC can add additional resorts in the future which could have a different end date. This has recently occurred with Saratoga Springs Resort & Spa (SSR), where DVC will offer membership until January 31, 2054. All of the discount programs are subject to change and may be modified at any time, but the DVC resorts and their total points may not be changed. Back to top How does the point system work? When you buy into the DVC, you purchase a certain number of points per year. The current price (retail) is $89 per point, for purchases at SSR -with a 150 point minimum for initial purchase and $84 per point for add-ons at the other DVC resorts-with a 25 point minimum for DVC members. Let's say you purchased 200 points. You would be assigned a "use year" (that is the month of the year in which your points would recycle). For example, my use year is February, and I own 200 points. Every February, 200 points are available for me to use that year. When I decide to book my vacation, I choose the dates I want to visit, and the type of room that I want to stay in. That will determine how many points that visit will cost me. I also have the option of banking my points into the next use year, or borrowing points against next year for this year. Which leads to the next question... Back to top How do I know how many points to purchase? This depends on how often you plan to visit Disney World, what size accommodation you would need, and what times of the year you want to visit. The Disney Information Station maintains a DVC Point Calculator and a DVC Point Chart. I suggest that you enter in some sample information, based on what type of vacation habits you have, to find out how many points would be appropriate for you. Many ask if DVC will change the point requirement for a stay at a DVC resort. While the total number of points sold at the resort is a fixed number and cannot be changed, point needs for stays can be changed. However, if points needed for some nights (or room types) are raised, other nights (or room types) must be lowered, as the total points required to stay at the resort for the year cannot be changed. This has occurred only once, in 1996 at OKW, and is likely to happen only if necessary to keep resort utilization in balance for the benefit of DVC members. At that time some nights were raised a few points, some were lowered a few points and most were not changed at all. Back to top Can I use my points at other resorts? The DVC is part of Interval International (a large, worldwide timeshare organization). Your DVC points can be traded for accommodations at many of the Interval Internationals resorts nationwide. You can also use your points to stay at other Disney resorts, as well as the DVC locations at Vero Beach, FL and Hilton Head, SC. and a number of other vacation opportunities such as the Disney Cruise Line and special Adventure programs. Back to top What if I decide not to keep it? You are free to sell your interest in the DVC just as you would any other real estate property. Many people list their DVC properties with companies such as the Timeshare Store, Inc. The Timeshare Store is a licensed Florida real estate company that acts as the broker for the sale and purchase of timeshare interests. You can get more info on The Timeshare Store by visiting their web site at http://www.timesharesale.com and info on their DVC Resales specifically at http://www.dvc-resales.com Back to top What should I know about buying timeshares through a resale company? There are a couple of points you should keep in mind when purchasing resale. First, watch out for companies who want to charge you any up front fees. You should never pay anything until a sale is final. Second, make sure that the resale agent you are dealing with is a licensed real estate agency. This lends a great deal of credibility to that agency, and gives you direct recourse (through the state board of realtors) should anything go wrong. We recommend The Timeshare Store in Orlando, FL. Many people who have visited this site have purchased DVC through them and have had excellent experiences in doing so. Back to top Once a DVC resort is sold out, if I buy through resale, will there be problems trying to book rooms? Disney Vacation Club resorts are busy places, there is no question about that. However, if you plan far enough in advance, you should be able to get the dates you want without much of a problem. Remember, at your home resort, you can reserve up to 11 months in advance of your check out date and 7 months in advance at other DVC resorts. All members have the same benefits and restrictions regardless how they joined the DVC. There is no negative to a membership purchased through resale. Back to top Still have Questions? If you have other questions that are not listed here, pay a visit to our DVC bulletin board. There you can ask any question you like of other DVC members. CLICK HERE to go to the boards! Back to top Transportation to Disney *Online Reservations *Free grocery/gift stop *Free booster/car seat Click Here Discount Disney Tickets 7 Day Ticket with Park Hopping Adult: $234 Child: $196 Click Here Visit the busiest and friendliest unofficial Disney forums on the web! CLICK HERE Check out DISAuctions! Here's your chance to bid (or auction) any number of Disney collectibles, movies, jewelry and much more!There is NO FEE to List items! CLICK HERE Theme Parks Cruise Disney Hotels Downtown Disney DVC Discounts Dining Transportation Forums/Chat Photos Privacy Statement | Contact Us | Terms of Service | Advertising Information | Site Dedication | Disney Vacations Discounts | Cruise Line Overview | Disney Cruise Line | Tickets | Hotels | Downtown | Animal Kingdom | Rides Attractions Disney World Hotels | Epcot Future World | Epcot Overview | Magic Kingdom | Orlando Transportation | Page Listing This site is not affiliated in any way with the Walt Disney Company or any of it's affiliates or subsidiaries. This site and the information contained therein represent the opinion of the webmaster. For official information on Walt Disney World, Click Here This site is owned and maintained by Werner Technologies. Click Here with any questions.

Orlando Vacation Packages Free

Cheap vacations to Orlando - discount hotel + air deals - TripAdvisor Orlando vacation discounts and deals Sign in • Sign up Home > United States > Florida > Orlando > SmartDeals > Vacation packages Orlando tourism: Overview Hotels Flights Attractions Dining Deals Getaways Forums Maps, etc. Discount hotels | Hotel + air deals | All travel offers Search (e.g., Orlando hotels, Las Vegas, Paris art museum) Orlando Orlando Overview Orlando Hotels Flights to Orlando Orlando Deals Discount hotels Hotel + air deals All travel offers Orlando Attractions Orlando Restaurants Orlando Forum Orlando Maps Orlando Discount Hotels Orlando Vacation Packages Free Newsletter Get deals, news and articles on Orlando Plus weekend trip ideas from your hometown Nearby Cities You may also be interested in these deals within five miles of Orlando: Edgewood Deals Winter Park Deals e-mail this page to a friend Orlando vacation packages Acapulco vacation packages Alaska vacation packages Amsterdam vacation packages Anaheim vacation packages Arizona vacation packages Aruba vacation packages Aspen vacation packages Atlanta vacation packages Atlantic City vacation packages Bahamas vacation packages Barbados vacation packages Belgium vacation packages Bermuda vacation packages Boston vacation packages Branson vacation packages Breckenridge vacation packages British Virgin Islands vacation packages Cabo San Lucas vacation packages California vacation packages Canada vacation packages Cancun vacation packages Caribbean vacation packages Colorado vacation packages Costa del Sol vacation packages Cozumel vacation packages Dallas vacation packages Daytona Beach vacation packages Dominican Republic vacation packages Florida vacation packages Florida Keys vacation packages Fort Lauderdale vacation packages France vacation packages Germany vacation packages Grand Canyon National Park vacation packages Greece vacation packages Grenada vacation packages Hawaii vacation packages Hilton Head vacation packages Ibiza vacation packages Ireland vacation packages Italy vacation packages Ixtapa vacation packages Jamaica vacation packages Kauai vacation packages Key West vacation packages Lake Placid vacation packages Lake Tahoe vacation packages Las Vegas vacation packages London vacation packages Los Angeles vacation packages Los Cabos vacation packages Maui vacation packages Mazatlan vacation packages Melbourne vacation packages Mexico vacation packages Miami vacation packages Montreal vacation packages Myrtle Beach vacation packages Nashville vacation packages Nassau vacation packages New York vacation packages New York City vacation packages Niagara Falls vacation packages Nova Scotia vacation packages Oahu vacation packages Orlando vacation packages Paris vacation packages Park City vacation packages Philadelphia vacation packages Phoenix vacation packages Pigeon Forge vacation packages Puerto Rico vacation packages Puerto Vallarta vacation packages Punta Cana vacation packages Quebec City vacation packages Reno vacation packages Rome vacation packages Salt Lake City vacation packages San Antonio vacation packages San Diego vacation packages San Francisco vacation packages Santa Fe vacation packages Scotland vacation packages Seattle vacation packages Spain vacation packages St. Croix vacation packages St. Lucia vacation packages St. Maarten/St. Martin vacation packages St. Thomas vacation packages Sydney vacation packages Texas vacation packages Toronto vacation packages Tucson vacation packages U.S. Virgin Islands vacation packages Vail vacation packages Virginia Beach vacation packages Washington DC vacation packages Whistler vacation packages Read more Orlando tourism Hotel + air deals to Orlando * Featured specials - December 28, 2005 Orlando : Save on hotel + air Expedia Vacations Don't just travel. 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Check out our Orlando weekend itinerary ! Visit our Orlando forum page to ask questions and get advice about Orlando travel. TripAdvisor forums let you ask questions and get advice - post in our Orlando forum . Our Maps, etc. page has maps and other travel information. Visit our Orlando discount hotels page for great savings on Orlando hotels, including TripAdvisor SmartDeals. Book a flight to Orlando on our Flights page. To view all the specials, vacation packages, and other travel offers we've found, visit our All travel offers page. About TripAdvisor TripAdvisor lists cheap air + hotel deals to Orlando, Florida. Recommendations for hotels, resorts, inns, vacations, travel packages, travel guides and lots more! 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Golf Vacation Resorts to

Golf Vacation Resorts to Love  You are here: About > Travel > Honeymoons / Romantic Getaways > Romantic Places > Vacations with a Difference > Golf Vacation Resorts to Love Travel Honeymoons Essentials 10 Ideas for a Great Romantic Getaway All-Inclusive Resorts Best Months to Go Nude Beach Guide Photo Galleries Articles & Resources Valentines Day Adults-Only Travel Honeymoon 101 Romantic Places Best of the USA Honeymoon in Hawaii Las Vegas Caribbean & Mexico Love Boats: Cruises for Two Destination Weddings Love & Romance Inexpensive Trips Honeymoon Buzz Weekend Getaways A - Z Romance Index Buyer's Guide Anniversary Gifts Cheap Champagne Find a Gift by Price Gown & Garment Bags Travelers' Gifts Forums Help FREE Newsletter Sign Up Now for the Honeymoons / Romantic Getaways newsletter! See Online Courses   Search Honeymoons / Romantic Getaways Stay up to date! The American Club, Wisconsin Email to a friend Print this page Suggested Reading Activities and Sports Vacations Top-Ranked Hotels, Resorts, and Destinations Find a Golf Instructor or School Related Guide Picks Top 5 Ski Resorts for Couples in the USA and Canada Most Popular Best New Romantic Hotels 2006 Romantic Getaway Ideas Love Quotes Anniversary Gift Last Minute Travel What's Hot Royal Caribbean Honeymoons New Year's Resolutions Beverly Hills Hotels Palmilla Resort in Mexico Travel Contests Related Topics Caribbean for Visitors Adventure Travel Canada for Visitors Hawaii / South Pacific for Visitors Marriage Top 10 Golf Vacation Resorts to Love Guide Picks From Susan Breslow Sardone , Your Guide to Honeymoons / Romantic Getaways . FREE Newsletter. Sign Up Now! If one or both of you golf, you probably want to take your next vacation -- even if it's your honeymoon -- at a resort with a superior golf course and golf facilities plus other amenities. At the following golf resorts both players and non-players can expect to have an exceptional vacation. The majority offer golf vacation packages, and some also feature romance packages. So if you one of you wants tee times and the other loves dinner by candlelight, you can choose a place that offers both. 1) The American Club, Wisconsin The Midwest's only AAA Five-Diamond resort hotel, the American Club is located in Kohler, named the top golf resort destination in the United States by readers of Golf Magazine. Golf course designer Pete Dye created two championship courses at both Blackwolf Run and Whistling Straits. For non-golfers, a vacation at the American Club can include shopping for antiques, visiting the innovative Kohler Design Center, spa treatments, hiking, and canoeing. The resort also hosts weddings. Buy Direct 2) Hyatt Dorado Beach Resort & Country Club, Puerto Rico Sunny days, warm breezes, and the sparkling Caribbean wrap the Hyatt Dorado Beach Resort & Country Club's four 18-hole golf courses, all designed by Robert Trent Jones Sr., in tropical splendor. The 4th hole on the East Course (6,665 yards) is ranked by Jack Nicklaus as one of the top 10 holes in the world. Both East and West (6,431 yards) seaside courses wind through tropical forests and citrus groves, along the Atlantic Ocean, past a chain of lakes, and a man-made lagoon. Read Review Buy Direct 3) Williamsburg Inn, Virginia Golf course designer Robert Trent Jones Sr. called the Golden Horseshoe's Gold Course his finest design, and many leading golf publications concur. Yet there's so much to do and see on a Williamsburg vacation that the allure of the links may fade. Travel back in history as you walk the streets, attend a town hall meeting at the brink of the American Revolution, stroll among the gardens, and dine on authentic 17th-century cuisine in the historic center or sophisticated fare at the elegant Inn. Read Review Buy Direct 4) Sea Pines Resort, South Carolina Twelve-mile-long Hilton Head Island holds an astonishing 22 golf courses, including three at 5,200-acre Sea Pines Resort. When you're not playing golf, there's boating, biking, fishing, horseback riding, kayaking, birdwatching, parasailing, and swimming to keep you active on your vacation. Read Review Vendor's Site 5) The Ritz-Carlton Golf Resort, Naples, Florida Ritz-Carlton boasts two award-winning hotels in Naples. This one, where golf is the focus, was named no. 1 hotel in Florida on Condé Nast Traveler's Gold List. It contains the Tiburon Golf Club with two 18-hole courses designed by Greg Norman and the Rick Smith Golf Academy. Guests have access to The Ritz-Carlton, Naples, also a Mobil Five-Star property, located just three miles away on the Gulf of Mexico. Non-golfers can use the pristine beach, fitness, and spa facilities. Read Review Vendor's Site 6) Mauna Lani Resort, Hawaii Rated the no. 1 golf resort on the Big Island by Condé Nast Traveler, Mauna Lani has two extraordinary golf courses carved out ot black lava fields that overlook the sparkling Pacific. At this ultra-luxury resort, you can unwind in a canopied chaise for two on the immaculate beach, experience an open-air sauna as part of the extensive spa, and dine at Canoe House, named the best restaurant on the island. While on the island, don't miss touring still-simmering Volcanoes National Park. Read Review Vendor's Site 7) Greenbrier Resort, West Virginia Three 18-hole championship courses and the Golf Digest Academy, which offers advanced instruction, attract golf aficionados to White Sulphur Springs. Non-golfers can swim in indoor and outdoor pools, depending on the weather, use the fitness center, and play tennis. They can also tour the bunker, secretly designed to harbor members of Congress during the Cold War. Additional recreation choices include whitewater rafting, horseback riding, and romantic carriage and balloon rides. Read Review Vendor's Site 8) Alisal Guest Ranch & Resort, California Northwest of Santa Barbara, the Alisal has been welcoming guests since 1946. Two 18-hole championship courses satisfy those who come to golf on either the private and secluded Ranch Course or the scenic and popular River Course. Set on a 10,000-acre working cattle ranch, the Alisal is also favored by horseback riders, who can choose from 100 steeds. If you like, the management will give you directions to a private spot overlooking the lake and a gourmet picnic basket to fortify you. Read Review Vendor's Site 9) Turning Stone Casino Resort In the midst of central New York's rolling farmland lies Turning Stone Casino Resort, an ever-expanding complex that features five golf courses. Among the designers: Tom Fazio, Rick Smith, and Robert Trent Jones, Jr. Non-golfing partners can gamble, swim, use the spa, or visit local attractions (including a huge mall). Read Review Publisher's Site 10) Four Seasons Resort Scottsdale at Troon North, Arizona No mention of great American golf resorts is complete without acknowledging the world-class resort golf courses of Arizona. From the Phoenician Hotel to the Boulders Resort to the Four Seasons, it just doesn't get much better. So take your pick, and rest assured that the non-golfer in your relationship with find that the spas, shops, swimming, tennis, restaurants, and weather on your golf vacation fit him or her to a tee. Read Review Vendor's Site Important product disclaimer information about this About site.        Topic Index | Email to a Friend Our Story | Be a Guide | Advertising Info | Work at About | Site Map | Icons | Help User Agreement | Ethics Policy | Patent Info. | Privacy Policy | Kids' Privacy Policy ©2005 About, Inc., A part of the New York Times Company . All rights reserved. Around About New Video iPod - Review POLL: Must-Have Gadgets VIDEO: Portable Gaming VIDEO: Choosing a TV Hugh Hefner's Life What's Hot Royal Caribbean Honeymoons New Year's Resolutions Beverly Hills Hotels Palmilla Resort in Mexico Travel Contests

Switzerland Travel

Switzerland, Switzerland Travel Advice, Ski Switzerland, Skiing in Switzerland, Swiss Ski Resorts, Swiss, Switzerland Information,Jungfrau, Verbier, Saas Fee and more Swiss Skiing, Ski Europe, Poll Thai Resorts, Poll France Resorts, free travel newsletter Weather Forecast Search Activelifestyle Select from list Partner hotels Brochures on-line Alpine routes Alpine ski maps EU golf maps TH golf maps UK Ski tours Golf video Ski video FREE Newsletter Snow Sports Gear SkiGear SkiJackets SnowboardBoots Information for Travel in Switzerland Zermatt.com Saas Fee Château d'Oex Les Diablerets Leysin Villars Engelberg Luzern Verbier Switzerland.com Andermatt Crans-Montana Veysonnaz Adelboden Gstaad - Saanenland Davos St. Moritz Jungfrau Region.com Grindelwald Interlaken Lauterbrunnen Mürren Wengen Ski Switzerland, Europe's spotless land of lakes and mountains. If skiing in Europe is your dream or if you do it frequently, skiing in Switzerland is a wise destination choice. World class ski resorts are all over Switzerland. World class ski lifts and mountain transportation will safely and comfortably get you into ski country, and some of the best hotels and restaurants in Europe will see to your comfort in Switzerland. Wining and dining in Switzerland are excellent activities and the Swiss kitchen, although underrated is certainly one of the best. Select from the resorts featured here-we will be adding more soon. About Activelifestyle | Contact European Reservations Dolonne, Courmayeur , family run hotel, bed/ buffet breakfast, great restaurant, 47 Euro,p/n,up Entreves, Courmayeur charming hotel, family friendly, 4 nights double half board from 260 p/n Get featured here. Pay 10% commission or .50cents per click through. Classified Ads Property Paradise? Invest for income or to live in Thailand. Paradise is yours. thailandpropertytimes.com Got something to say? Say it to a global audience. 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European Vacation There's a

Federal Reserve Bank of Minneapolis - The Region - European Vacation (December 2003) I'm at: Home > Publications > The Region > December 2003 > Article Publications Expand All Collapse All The Region Index by Issue Interviews President's Columns fedgazette Index by Issue Topics Index Annual Report Quarterly Review Community Dividend Banking and Policy Studies Articles Toolbox ( advanced search ) December 2003 European Vacation There's a simple reason Americans work longer hours than Europeans, says economist Ed Prescott. And it isn't what you think Douglas Clement Editor It's no secret that Europeans work less than Americans do. Every Labor Day the media tell us that Europeans have just enjoyed weeks of summer vacation while Americans have been toiling away. These stories often depict Americans as hard-working drones who revere material possessions above all else. Europeans meanwhile bask in the good life of long lunches and months at the beach. There is some truth to the portrayal, at least in terms of hours worked. The International Labor Organization reports that the average American worked 1,815 hours in 2002, well above the comparable figures for France (1,545) and Germany (1,444), for example. (The average South Korean, on the other hand, worked over 2,400 hours.) But if it's widely acknowledged that Americans work more hours than Europeans, it remains a puzzle quite why there's such a large difference. With similar economies and social structures—at least relative to the rest of the world—it would seem that labor patterns should also be alike. Social scientists have been hard-pressed to explain the disparity. Most accounts focus on cultural explanations. The most popular is the notion that Europeans have a fuller appreciation of la dolce vita —the sweet life—the Italian version of the idea that life is to be enjoyed, not endured. Work is a means to an end, not an end in itself. The idea of cultural and religious influences on economic activity isn't new. German sociologist Max Weber wrote The Protestant Ethic and the Spirit of Capitalism nearly a century ago, attributing the rise of capitalist economies to the “Protestant work ethic.” It was an immensely persuasive theory in its time, and derivative explanations have held great sway ever since. “Why do Europeans and Americans differ so much in their attitude toward work and leisure? I can think of two reasons,” opines a recent Time magazine essay. “Broadly speaking, Americans value stuff—SUVs, 7,000-sq.-ft. houses—more than they value time, while for Europeans it's the opposite. Second, ... in the puritanical version of Christianity that has always appealed to Americans, religion comes packaged with the stern message that hard work is good for the soul. Modern Europe has avoided so melancholy a lesson.” “It all comes down to what people feel is important and how they feel about their lives,” argues a September 2003 U.S. News & World Report editorial. “We value more money and more stuff; they value more leisure time. ... We are proud of being busy—it is a virtue; being idle is perceived as a vice.” Economic explanations Economists have always been suspect of such cultural explanations. Standard economic theory assumes that people's preferences are, on average, homogeneous, and that choices depend largely on economic factors. Still, while economists agree that dollars and cents lie behind the work pattern differential, there is little harmony among them as to the right economic explanation. Some economists say work regulations keep Europeans from working longer hours and point favorably to recent European reforms on vacation time. Others argue that greater inequality in the United States motivates workers to try harder to get ahead. Most of these explanations come from the perspective of labor economics and its core belief that social structures and institutions such as unions are the major determinants of labor patterns. But in a recent series of papers and lectures, Edward C. Prescott, senior monetary adviser to the Minneapolis Fed and economist at Arizona State University, looks at the labor supply question through the prism of the growth model—a different perspective altogether—and provides a convincing and remarkably straightforward explanation for the dramatic differences in hours worked. It is an explanation that has far-reaching implications for policymakers—and for anyone else who's ever received a paycheck. According to Prescott, the reason for these large differences in labor supply is not culture. “French, Japanese, and U.S. workers all have similar preferences,” he writes. “The French are not better at enjoying leisure. The Japanese are not compulsive savers.” The reason for the wide range in working hours is, in a word, taxes. Europeans supply less labor because there's a much larger wedge in most European countries between what a worker is paid and what that worker actually gets to keep after taxes are taken out. This tax wedge, argues Prescott, distorts the trade-off people make between consumption and leisure by making consumption more expensive. And since people work, ultimately, to earn money to pay for consumption goods, they'll supply less labor if consumption goods become relatively more expensive. The cheaper alternative: leisure. Hello, Riviera. If the concept seems straightforward, its evolution was anything but. Like most ideas that seem obvious in retrospect, the awareness that taxes distort labor markets dramatically and account for major international differences in work patterns came about indirectly and as a revelation to those who happened upon it. The discovery Prescott's discovery about the role of taxes in labor supply variation began, simply enough, in his classroom at the University of Minnesota, where he taught from 1980 to 2003. “I was making up exercises for my students,” he recalled in a recent interview. “I said, 'use this nice little growth model.'” The “nice little model” he presented to his students is the workhorse of modern macroeconomics; it says, mathematically, that a nation's total output (or gross domestic product, GDP) is dependent on three sources: labor, capital and the efficiency (or productivity) with which it merges them to create economic value. The other key part of this standard theory is, in the jargon of economics, a utility function: a formula representing the notion that households try to maximize their happiness by finding the best possible combination of leisure and consumption, given their resources. Prescott wanted his students to become familiar with this model by looking at how it performed in different nations over time, and how key variables—capital endowments, productivity, labor supply—could account for differences among nations in per capita GDP. “I wanted to try to get across the basic ideas and the importance of productivity,” said Prescott. “And then I thought, let's put a few taxes in.” The intuition was far more significant than Prescott suspected, but that became clear only after looking at the relative contributions of capital, productivity and labor. The data, compiled by the United Nations and the Organization for Economic Cooperation and Development, showed that in the mid-1990s among developed countries—the United States, much of Europe and Japan—relative levels of capital differ little and explain just a small portion of the variation in per capita GDP (see adjacent table). “The capital factor is not an important factor in accounting for differences in incomes across the OECD countries,” writes Prescott in his 2002 Richard T. Ely Lecture to the American Economic Association. “[It] contributes at most 8 percent to the differences in income between any of these countries.” Capital, Labor, Productivity and GDP 1993-96 Country Capital/ Output Ratio (1990) Hours worked per Week per Person 15-64 Productivity: GDP per hour Worked; US=100 GDP per Person 15-64; US=100 Germany 2.7 19.3 99 74 France 2.2 17.5 110 74 Italy 2.6 16.5 90 57 Canada na 22.9 89 79 United Kingdom 2.6 22.8 76 67 Japan 2.5 27.0 74 78 United States 2.3 25.9 100 100 Source: Federal Reserve Bank of Minneapolis Research Department Staff Report 321 and Working Paper 618 . Productivity, on the other hand, is very important, at least for some national differences. Japan and the United States, for example, have similar levels of labor and capital, but per capita GDP in Japan is far below that in the United States because its productivity is less than three-quarters that of the United States. But what of European countries like France, Italy and Germany? Why are their levels of per capita GDP so much lower? All these nations have capital endowments comparable to the United States. Their productivity levels also are similar to U.S. rates, or in the case of France, even higher. The data suggest that the differences in wealth are due almost exclusively to the markedly lower number of hours worked in these European countries. Germany, for instance, had a slightly higher capital endowment than the United States and an equal level of productivity, but just 74 percent of the U.S. per capita GDP. The evident reason: Its workers supplied just over 19 hours of labor per week compared to nearly 26 hours a week per American worker. While many believe that cultural differences lead to fewer hours worked in Europe than in the United States, Prescott doubts it. After all, data from the early 1970s show that the French actually worked more hours per week than did Americans at that time. Has French culture changed radically over the last two decades? Probably not: They still like good wine, aged cheese and, inexplicably, Jerry Lewis. Prescott's hunch was that differences in marginal tax rates might explain the differences in labor supplied and thus account for differences in per capita GDP. Enter the tax wedge “What is important is the price of consumption relative to leisure,” Prescott writes in the lecture he gave in April 2003 as he accepted Northwestern University's prestigious Erwin Plein Nemmers Prize in Economics. “And it is determined by the consumption tax rate and the labor income tax rate.” (See the lecture, “ Why Do Americans Work So Much More Than Europeans? ”) By introducing these taxes into the growth model, and making standard microeconomic assumptions, Prescott derived what he calls “the key equilibrium relation.” 1 It's a mathematical formula for labor supply that says workers will supply labor dependent on, among other things, their preference for consumption now over consumption later (spend or save?), their preference for leisure relative to consumption (play or work?) and the effective tax rate. Holding the first two variables fixed and looking empirically at different national tax rates enables Prescott to see if tax differences can account, fully or partially, for variations in labor hours supplied. Estimating the effective tax rates in these countries was, in itself, a major accounting exercise. Consumption taxes include value-added taxes, sales taxes, excise taxes and property taxes. Labor is subject to both income taxes and Social Security taxes. For each nation under consideration, Prescott and his students crunched the numbers, determined a tax rate, plugged it into the formula along with fixed estimates of the other variables, and derived predictions of labor hours supplied per week per worker. How good were the predictions? Dead-on for Germany and the United Kingdom, a bit low for Canada and the United States, and a bit high for the other countries (see table below). Given measurement inaccuracies, the rough nature of the tax-rate estimates and the difficulty of international comparisons, writes Prescott, the model's predictions were “surprisingly close to the actual.” Tax Rates and Labor Supply 1993-96 Country Tax Rate (percent) Actual Hours Worked per Week per Person 15-64 Predicted Hours Worked per Week per Person 15-64 Difference (Predicted Minus Actual) Germany 59 19.3 19.5 0.2 France 59 17.5 19.5 2.0 Italy 64 16.5 18.8 2.3 Canada 52 22.9 21.3 -1.6 United Kingdom 44 22.8 22.8 0.0 Japan 37 27.0 29.0 2.0 United States 40 25.9 24.6 -1.3 Source: “ Why Do Americans Work So Much More Than Europeans ?” Federal Reserve Bank of Minneapolis Research Department Staff Report 321. Here, notes Prescott, “the important observation is that the low labor supplies in Germany, France and Italy are due to high tax rates. In these countries if someone works more and produces 100 additional euros of output, that individual gets to consume only 40 euros of additional consumption and pays directly or indirectly 60 euros in taxes.” Put in such stark terms, it seems obvious that many Europeans might opt to work less, while Americans and Japanese, taxed more lightly, would be keen to put in extra hours. Confirmation and implications Prescott found further confirmation for his hypothesis when he looked at tax rates and labor supply in the early 1970s (see table below). While his model's predictions of labor hours supplied diverge from the actual in several cases—Italy and Japan, in particular—Prescott observes that “when European and U.S. tax rates were comparable, European and U.S. labor supplies were roughly equal.” Tax Rates and Labor Supply 1970-74 Country Tax Rate (percent) Actual Hours Worked per Week per Person 15-64 Predicted Hours Worked per Week per Person 15-64 Difference (Predicted Minus Actual) Germany 52 24.6 24.6 0.0 France 49 24.4 25.4 1.0 Italy 41 19.2 28.3 9.1 Canada 44 22.2 25.6 3.4 United Kingdom 45 25.9 24.0 -1.9 Japan 25 29.8 35.8 6.0 United States 40 23.5 26.4 2.9 Source: “ Why Do Americans Work So Much More Than Europeans ?” Federal Reserve Bank of Minneapolis Research Department Staff Report 321. As for the outliers, Italy and Japan, Prescott suggests that other factors may be significant. In Italy, cartels may have played a role in depressing labor supply below its predicted value. In Japan, significant measurement errors in actual hours worked could account for the overly high prediction by the model. And what seems another anomaly is very likely an indirect confirmation of the importance of marginal tax rates on labor supply, according to Prescott. In the United States, actual hours worked per person increased by 10 percent from the 1970s to the 1990s, though the marginal tax rate remained at 40 percent. Prescott argues that U.S. tax reforms in the 1980s changed the effective marginal tax faced by married couples—dropping the rate in half for the second earner's income—even though it remained nominally at 40 percent. “In the 1993-96 [period],” he writes, “the marginal income tax on the labor income associated with switching between a one-earner and a two-earner household is only 20 percent, not 40 percent.” The issue warrants more attention, he says, and indeed, his colleagues Larry Jones, Rodolfo Manuelli and Ellen McGrattan have recently released a paper on this exact question. (See “ Wives at Work .”) On the whole, Prescott states, the results show that “people are remarkably similar across countries” and not only for these relatively prosperous and homogeneous nations, but for Chile, Mexico and Argentina, as well, where other economists have found similar relationships. “Apparently, idiosyncratic preference differences average out and result in the [representative] household having almost identical preferences across countries.” The policy implications are enormous for high-tax countries. If France were to lower its effective tax rate from 60 percent to 40 percent, estimates Prescott, its people would work more (taking 6.6 percent less leisure) and—remember their high productivity?—would generate considerably more output. Tax revenues wouldn't diminish, because the 40 percent rate would be levied on a higher base. And overall French “welfare gains,” as economists put it, would increase nearly 20 percent. In the United States, reducing marginal tax rates would have a more modest impact, according to the model: A 10 percent rate reduction would produce a 7 percent welfare gain. But even in the United States, Prescott's findings have huge implications for the viability of the Social Security system. (See “ Shrinking a deadweight loss .”) Foreign affairs In recent months, Prescott has traveled widely, presenting his findings not only to American audiences but to economists and policymakers in London, Berlin, Toulouse, Tokyo and elsewhere overseas. And in fact, says Prescott, Europeans tend to be more receptive than Americans. “The economists there understand that there is a problem,” he said after returning from France in mid-September. “I got some excellent suggestions when I presented the paper, the best so far.” But at all venues, he observes, the common denominator is surprise. Prescott is the first to admit that he, too, thought the results were startling, unexpected. “I find it remarkable that virtually all of the large difference in labor supply between France and the United States is due to differences in tax systems,” he writes in his Ely lecture. “I expected institutional constraints on the operation of labor markets and the nature of the unemployment benefit system to be more important.” Moreover, he concedes that cultural explanations might carry the day in a few settings. “Scandinavians seem to be a little bit different,” he said recently, referring to research by Richard Rogerson, an economist at Arizona State University. “My theory is when one of those Swedes looks at you when you're not working, it's pretty intimidating.” More seriously, he allows that in small, homogeneous cultures, social pressures can be quite strong. But even in large, heterogeneous nations, tax wedges don't always tell the whole story, according to Prescott. “Taxes are not the only reason that the labor factors differ,” says Prescott's Ely lecture. Unemployment benefits and housing subsidies—not taxes—distorted labor mobility in the United Kingdom between the first and second World Wars, contributing significantly to that country's interwar depression. New Deal policies supporting cartels in America's heavy industries distorted wages and employment in the last half of the 1930s, contributing to the depth and duration of the Great Depression in the United States. Similarly, cartels in 1970s Italy may have suppressed employment there. Prescott relies on work by University of California, Los Angeles economists Harold Cole and Lee Ohanian in making these conjectures. Still, while taxes aren't the all-powerful explanatory factor for all nations and eras, Prescott contends that in major developed countries in the time period under consideration, the labor supply impact of tax wedges is a powerful and undeniable fact. Other academics As befits the work of any prominent scholar, Prescott's theory has attracted close academic scrutiny—beyond the initial reaction of surprise—from both adherents and critics. In one recent paper, Peter Lindert, an economist at the University of California, Davis, refers to Prescott's study as dependent upon “a theoretical model heavily laden with assumptions. It is educated, intelligent, plausible fiction—but fiction nonetheless.” On the other hand (as Lindert points out) Prescott's model and findings are cited quite favorably by Nobel Laureate Robert Lucas in his 2003 presidential address to the American Economic Association. Lindert calls for empirical tests. Steven Davis at the University of Chicago Graduate School of Business and Magnus Henrekson of the Stockholm School of Economics oblige with a careful econometric analysis of the impact of labor income and consumption taxes on employment and work activity. In their study of rich countries in the mid-1990s, they find that a 12.8 percentage point difference in tax rates is associated with 122 fewer market work hours per adult per year and nearly a 5 percentage point decrease in employment—population ratios—an indirect affirmation of Prescott's theory. A very different perspective was presented earlier this year in a series of lectures by British economist Richard Layard, co-director of the Centre for Economic Performance at the London School of Economics. Layard takes issue with GDP itself as a satisfactory measure of human welfare—or utility, as Jeremy Bentham and subsequent economists have termed it—noting that “happiness has not increased, despite huge increases in living standards.” To summarize a lengthy argument, Layard's idea is that a tax wedge on labor income could actually increase utility by decreasing a sort of pollution: overwork brought on by the inherent human desire to do better than our peers, regardless of our absolute level of income. Keeping up with the Joneses, in other words, leads to overwork, ill health and unhappiness—rivalry distorts the leisure/labor decision. Appropriate public policy should diminish this pollution by taxing it. “In an efficient economy,” Layard writes, “there will be substantial levels of corrective taxation ... 60 percent would not seem inappropriate, and that is in fact the typical level of marginal taxation in Europe—if you allow for direct and indirect taxes.” Prescott responds Prescott's reactions to these ideas vary widely. Sitting in his seventh-floor office at the Minneapolis Fed, he reads through the first pages of Lindert's paper, then drops it on his desk. “It doesn't seem to be coherent,” he says. Davis and Henrekson's study, on the other hand, intrigues him. That might seem predictable given its broad support of Prescott's findings, but Davis and Henrekson employ a technique Prescott generally scorns: statistical regression. “Progress, don't regress,” he says with a smile, quoting the slogan featured prominently on his Internet home page. Regardless of their method, Prescott is drawn to the findings and has invited Davis to Minneapolis to get a closer look at their work. But Prescott's response to Layard's argument—more complete and nuanced—conveys a sense of Prescott himself. He begins by summarizing Layard's case in a phrase: “I'm happy if I have a lot more income—than you,” he says, grinning and quite aware that he does. As to the overwork such rivalry might cause, “that just says there's a consumption externality.” Then he conveys the concept with a story. “I always tried to create a positive externality in Pittsburgh for my neighbors who had these beautiful lawns,” he jokes of his grad school days at Carnegie Mellon University. “By my having a messy lawn, their lawns looked so much better. I mowed it, but I didn't do much else with my lawn. And it gave me utility to see them happier.” He tells the story with a verbal wink, acknowledging silently that his Pittsburgh yard care externality may well have been less than zero. The conspiratorial smile changes to professorial zeal as he begins to dissect Layard's reasoning: “Suppose everybody cares about relative consumption as well as own consumption. You work out the equilibrium, it's not Pareto optimal. Let's deal with the case where everybody enters symmetrically. So it's simple to make the ordering. Well, you can make everybody better off by just putting a tax on consumption so that they work less. That's a very standard model. Now what would be the empirical evidence for and against that?” In under five minutes, Prescott has crystallized an argument, communicated it to a visitor in plain language and personal anecdote, then converted it to the idiom of economics and laid out steps for its confirmation or refutation. It's vintage Prescott: analytically brilliant, unexpectedly funny and several beats ahead of everyone else. That last bit is the essence of a conversation with the economist. When you ask him a question, it sometimes seems that his reply is off-topic; then it dawns on you that Ed Prescott is answering the question you should have asked. A pattern of surprise Prescott's willingness to entertain alternatives, to listen to critics, to incorporate the unexpected is deeply characteristic of his work. That flexibility is, in fact, the paradoxical outcome of a rigid research discipline. In setting model parameters, for instance, or reporting research results, “the investigator has no degrees of freedom,” he says. “You have to tie your hands and if there's a deviation from your predictions, you report it. You can speculate on why, but you've got to be totally honest.” Intellectual honesty also means allowing findings to modify, even subvert initial hypotheses. It happens frequently, says Prescott. Much of the work for which he's best known—theories on time inconsistency, real business cycles, the equity premium and growth theory—has been developed in an ongoing process of research and revelation. “When I work out the implications, I'm quite often surprised: The findings change my views quite dramatically,” he says. “When I did the real business cycles work with Finn Kydland, I was certain that monetary shocks were the reason the economy fluctuated with the business cycles. Our findings were just the opposite. When I did some work with Rajnish Mehra on the equity premium puzzle, I was certain that the reason for the high historical difference in the return on equity relative to debt was just a premium for bearing aggregate, nondiversifiable risk. We found it wasn't.” For time inconsistency and the impact of taxes on labor supply, as well, surprise has been an intrinsic part of the process. Future direction As striking as his labor supply findings are—and though many aspects of it remain unresolved—Prescott senses that the big theoretical questions in economic growth lie elsewhere, and he is now turning his attention to them. “I think I've had my say on labor supply,” he concludes. In his Ely lecture, he lays out three sources of economic growth: capital, labor and productivity. The first two are important in understanding why some nations remain poor while others prosper, but the central question, contends Prescott, is what determines productivity? “Given productivity, our macro models are great,” he says. “But we treat it as exogenous. We've got to have a better understanding of mapping between policies and productivity.” In other words, what can governments do to enhance productivity? Prescott's main candidates are efficient financial markets, competition among producers and trading clubs. And currently, the last is his major focus. “What is a trading club?” he asks rhetorically. “Well, first, free movement of goods between the member states. But it's much, much more than that. ...” Prescott continues at length, with a discourse ranging from Toyota factories in Wales to trade among the U.S. states in the 19th century. He speaks quickly, and as he does there is a sense that each research question he asks leads him to a dozen more, each more interesting than the last. He will travel soon to Warsaw and then Bogotá to explore these ideas with other economists and policymakers. “It's going to be fascinating to see what's happening in Poland,” he remarks. In Colombia, “the president is trying to do some good things there, and we have to go down and help out.” He's not a policymaker himself. “I leave that to other people,” he says. “I'm no good at it. My comparative advantage is working out implications of theory.” And in so doing, it seems there is just one constraint: Even for Ed Prescott, a scholar who understands labor supply dynamics as well as anyone on earth, there are only 24 hours in a day. “Time,” observes the economist, “is the most valuable resource.” 1 The two assumptions: (1) that people decide between leisure and consumption based on their relative prices, at the margin, and (2) that in a competitive market, wages are equal to their marginal product of labor. The “key equilibrium relation” also depends on the share of a nation's output due to capital. Top of document Advanced Search Glossary See also: Shrinking a deadweight loss