Would Time Money reduce efficiency?

Mike responded to A-B-C Economics with this question and comment:

What effect does a system like this have on efficiency? In the of case Henry Ford, he brought the time to produce a car from months to hours. Lets say in simple terms 10 hours to produce a model T where previous methods took 100 hours. Under the capitalist system one could charge 50% less and society as a whole would benefit from cheaper transportation provided in a shorter time frame at a reduced cost. Just as the historic model points out. Under a pure time hour system would efficiency suffer where there would be little incentive to decrease your labor hours as that would be your only means of income?

The incentive to be efficient is to sell at a lower price than a competitor. Henry Ford could have done exactly the same thing with Time Money that he did with dollars. The difference would have been that the prices would have been expressed in Hours. So he might have advertised his car by stating the price as, for example, 10 Hours, compared to other cars priced at 100 Hours. He could have stated his price higher than its actual price. However, his competitors would have known how much more efficient they would have to be to beat his price.

The last sentence of Mike’s comment could also refer to a worker slowing down their work in order to receive a larger income.  That is a problem with dollars as well as Time Money.  The remedy is supervision.  An employer would continue to be responsible as now for checking an employee’s work every now and then to be sure they are actually working for their pay.  That supervision would probably decrease as the employer saw that the employee was doing a good job during their time at work. 

An employer could also pay a new employee less than an Hour for an hour of work, say 1/2 Hour, telling the employee that they will be paid full time when they have learned the job.  An employer could pay more and an employee could ask for more than full time based on productivity or other factors like overtime, say, time and a half or double time. 

The difference with Time Money is that the greater amounts would be more likely to stay within more reasonable boundaries than now.  CEOs would not be able to argue that they deserve 100 Hours per hour of work like they do now with dollars.  A CEO taking $1,000,000 per year is receiving $500 an hour.  One taking $100 million a year is receiving $50,000 per hour.  Put those numbers in Hours and we would see a big drop in how much people at the top can take and an increase in what everyone else can then be paid.

Thanks, Mike, for your question and comment.