You might be familiar with hand-wringing about how people are extending their adolescence into their twenties and not entering “adulthood” until later (“thirty is the new twenty” and all that). This concerns me a bit, too, but should it?

It’s easy for me to shake my head about men acting like teenagers or living at home into their late twenties, but I wonder if this might not be what Friedrich Hayek’s model of an advancing economy predicts.

Longer life expectancies and better technology mean longer production processes and a lengthier structure of production with far more stages. In Hayek’s model of an expanding economy with a lengthening structure of production, we expect to see more resources devoted to “investment” and fewer resources devoted to current consumption. It shouldn’t be that surprising that people are spending longer investing in social and human capital. Here are a couple of issues with this explanation:

1. It might be a just-so story: does Hayek’s perspective offer a lot of insight here, or am I shoehorning the data into a model I really like?

2. Is a lot of what goes on during extended adolescence investment or consumption? Here we wander into murky waters. It would be easy to dismiss drinking with friends and playing video games as consumption, but I’m not sure that fits as what looks like (and is measured as) consumption spending might be investment in social capital. You might look like you’re just getting hammered with your friends, but you might really be investing in relationships that will pay off in future opportunities later. The line between “consumption” and “investment” isn’t as bright as the national income accounts would have us think.

I’ll (again) put the question to EconLog readers. What’s going on with extended adolescence? Should we be worried? Or should we calm down?