One issue that frequently comes up regarding Elizabethan plays is the length of an average performance. The prologue to Shakespeare's Henry V speaks of "Turning th' accomplishment of many years / Into an hour-glass." In Romeo and Juliet the prologue mentions "the two hours' traffic of our stage."
Modern productions of Shakespeare frequently run more than three hours. (I just saw one such Richard III.) However, marathon performances like this would have been impossible in Elizabethan times. Outdoor performances did not begin until two o'clock in the afternoon. Both in late winter when the theatrical season opened, and in the autumn when it closed, the sun typically sets in London around five o'clock. The final scenes of a production lasting more than three hours would had to have been performed in darkness.
What is more, Elizabethan performances did not end when the play was finished. After the play was over, the actors would return to the stage to perform a jig, a special dance that told a story, generally of a comic and bawdy nature. While we do not know the steps to these dances, some texts survive with music and lyrics.
Unlike the plays of the period, Elizabethan jigs have fallen out of fashion, but they once were as popular as the main plays. In fact, there are numerous accounts of audience members skipping the plays entirely and choosing to just come for the jigs at the end. Not only did plays have to leave enough daylight hours for their final scenes, they had to leave time for the elaborate jigs, which were a big draw for a theatre's audience.
So why do plays from the period seem so long? For one thing, not all of them are long at all. For instance the anonymous 1608 play A Yorkshire Tragedy, which deals with a sensational crime that had recently taken place in the north of England, is really just a long one-act play. Others, such as most of the texts by Shakespeare we have, are likely not performance texts at all, but extended versions of the play that could be cut in different manners depending on the occasion. Shakespeare's company might perform, trim back, or eliminate various parts depending on whether it was performing at the Globe, at court, or touring in the provinces.
Some plays exist in multiple printed versions, which is strong evidence of different performance texts. The version of King Lear printed in 1608 has about 400 lines that do not appear in the First Folio of Shakespeare's works published after his death. The posthumously published play, however, has about 100 lines not in the original, including a famous prophesy of Merlin. As is the case with King Lear, whole scenes can sometimes be missing from variant texts. This suggests Elizabethan companies would pick and choose which parts of a play to perform, which also could explain why the average performance time could not have run much more than two hours.
So what should modern directors do? Perform every single line we have, in spite of the fact Shakespeare's company certainly never did such a thing, or judiciously trim a text to keep it to around two hours or so? Well, what would you as an audience member prefer: to see a great two-hour play that leaves you wanting more, or see a three-and-a-half hour play in which you spend the last 45 minutes looking at your watch. The question answers itself.