This makes sense; for instance when you are 10 years of age, a year represents 10% of your life, and seems like a very long time. However, when you are 50 years old, one year has reduced to only 2% of your life, and hence seems only one-fifth as long. Interesting hypothesis, and he makes it look very scientific with the formulae and all, but it's still a wild crazy guess that delivers no actual falsifiable prediction…
While we're on pet hypotheses, what about the fact that the brain simply gets bigger ? If neural signals–maxing out at ~100 m/s–took longer to traverse the average distance through the brain, one's perception of time would seem to slow down. Anecdotally, when I was 8 or so I once sat there for an hour or so memorizing the rate of the clock (so I could later mentally estimate intervals of time without a stopwatch). At…
I seem to recall an article from Joel on Software about the same phenomenon from a procedural point of view, where he compares increasingly complex institutional reaction times to the increasing amount of ritual that is being performed before we leave the house (with old people taking the longest time, because based on past experience of all things that went wrong in the past, their checklists before leaving the house become absurdly long over time).
Just an interesting side observation about the VLC speed thing: my personal sense of rhythm has always been so bad that I couldn't tell the difference between 100% speed then and 80% speed now. But an observation I recently made was that I can now comfortably listen to videos at 110% or even 120% their speed without losing content - something I certainly couldn't do at a younger age (in fact, I remember I often had to pause recordings in order to think about stuff that just happened or even just to empty my "language recognition buffer" before I could move on). So while it may well be true that 1 second doesn't last as long for me as it used to, I certainly seem to have become more efficient at processing some types of data.