212. The Economics of Sleep, Part 2

The episode examines how sleep duration affects earnings using natural experiments from U.S. time zones, showing that people in areas with later sunsets sleep less due to misalignment between solar time and clock time. It builds on prior research finding higher-wage workers sacrifice sleep, and introduces an economic framework where sleep is a time-use decision with opportunity costs. Data from time diaries and geographic variation support the link between sleep and labor market outcomes.

It provides a rigorous economic model for understanding sleep as a time-use decision, backed by real-world data from time zone variations.

1. 01People in the western edge of a time zone (with later sunsets) sleep less than those on the eastern edge, despite same clock time, due to solar influence on sleep cycles.
2. 02Higher-wage workers tend to sleep less, trading sleep for income-generating activities, consistent with opportunity cost theory.
3. 03Sleep is not purely biological but responds to economic incentives, meaning policy or workplace changes could improve both sleep and productivity.