Sleep, Health, and Human Capital: Evidence from Daylight Saving Time
Sleep, Health, and Human Capital: Evidence from Daylight Saving Time
Wednesday, June 13, 2018: 12:20 PM
Starvine 1 - South Wing (Emory Conference Center Hotel)
Discussant: Jeff Shrader
Despite the abundance of studies investigating the formation and effects of human capital, the one single activity that humans spent most of their lifetime doing—sleep—has received very little attention in the economics literature. This paper is one of the first to test for a causal relationship between sleep and human capital. It exploits the quasi-experimental nature of Daylight Saving Time (DST), up to 3.4 million BRFSS survey responses from the US, and all 160 million hospital admissions from Germany over one decade.
Even mild changes to sleep patterns can affect human capital in significant ways. We find that setting clocks back by one hour in fall significantly extends sleep and reduces self-reported tiredness during the day. In turn, self-reported health improves and hospital admissions decrease significantly for about four days. This demonstrate that more sleep may lead to significant, immediate, health improvements for people on the margin to getting hospitalized. For a broader subgroup of the population, we estimate 2.5 million (sleep deprived) Americans, more sleep leads to significant improvements in subjective well-being.
In the last part of the paper, we attempt to categorize and monetize the various economic benefits of getting more sleep for the sleep deprived. We assess the value of feeling rested due to enough sleep at $50 per day, on average. Avoiding a four day long hospital stay avoids health care costs for society, increases labor supply for those who work, and saves the individual the disutility of being hospitalized. We estimate the total monetary benefit of preventing an admission at around $3000 (in Germany).
Even mild changes to sleep patterns can affect human capital in significant ways. We find that setting clocks back by one hour in fall significantly extends sleep and reduces self-reported tiredness during the day. In turn, self-reported health improves and hospital admissions decrease significantly for about four days. This demonstrate that more sleep may lead to significant, immediate, health improvements for people on the margin to getting hospitalized. For a broader subgroup of the population, we estimate 2.5 million (sleep deprived) Americans, more sleep leads to significant improvements in subjective well-being.
In the last part of the paper, we attempt to categorize and monetize the various economic benefits of getting more sleep for the sleep deprived. We assess the value of feeling rested due to enough sleep at $50 per day, on average. Avoiding a four day long hospital stay avoids health care costs for society, increases labor supply for those who work, and saves the individual the disutility of being hospitalized. We estimate the total monetary benefit of preventing an admission at around $3000 (in Germany).