Context Switching among multiple threads in Java

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What constitutes Context Switching? I know it can be by using sleep() at times. I came across an example using a combination of wait() and notify() to carry out inter-thread communication so that one thread (of Producer class) supplies a data set and then waits till the another thread (of Consumer class) has consumed it.

My question is regarding performance implication where it is argued that "CPU wastes more time doing context switching and less time doing actual work". But looking at this example I think that context switching is made to happen only when the CPU completes the desired set of operations. Then what is the logic behind above quoted statement? Please find the attached example (Courtesy: Osborne The Complete Reference Java).

/*An implementation of a producer and consumer.*/

class Q {
int n;
boolean valueSet = false;

synchronized int get() {
    if(!valueSet)
    try {
      wait();
    } catch(InterruptedException e) {
      System.out.println("InterruptedException caught");
    }
    System.out.println("Got: " + n);
    valueSet = false;
    notify();
    return n;
}

synchronized void put(int n) {
    if(valueSet)
    try {
        wait();
    } catch(InterruptedException e) {
        System.out.println("InterruptedException caught");
    }
    this.n = n;
    valueSet = true;
    System.out.println("Put: " + n);
    notify();
}
}


class Producer implements Runnable {
    Q q;
    Producer(Q q) {
        this.q = q;
        new Thread(this, "Producer").start();
    }
    public void run() {
        int i = 0;
        while(true) {
            q.put(i++);
        }
    }
}

class Consumer implements Runnable {
    Q q;
    Consumer(Q q) {
        this.q = q;
        new Thread(this, "Consumer").start();
    }
    public void run() {
        while(true) {
            q.get();
        }
    }
}


class PCFixed {
    public static void main(String args[]) {
        Q q = new Q();
        new Producer(q);
        new Consumer(q); 
        System.out.println("Press Control-C to stop."); 
    }
}
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Madhusudana Reddy Sunnapu On

CPU wastes more time doing Context Switching and less time doing actual work.

This is because, during the context switching OS kernel has to save the the state of the cpu registers for the current thread, then load these registers with the correct state for the next thread that is next to be executed. This is an extra work that kernel has to do during context switching not related to application code.

Another side effect of this is, we loose the locality of references because of context switch.