The life of an economist is often frustrating. It’s our job to figure out the most efficient, welfare-enhancing solutions to economic problems, only to see the 2nd or even 20th best solution become policy. There are special interests and well-intentioned, but misinformed, policy makers who steer us toward inefficiency—and the most vulnerable suffer. I’m not talking about trade tariffs, a high national minimum wage, or decaying infrastructure, I am talking about Daylight Saving Time (DST).
This Sunday (March 13), North Americans (who don’t live in non-Navajo Arizona, Saskatchewan, Quintana Roo, Sonora, Hawaii, or some Amish communities) will start DST and set their clocks forward one hour. Between then and April 3 dozens of more countries (mostly rich ones) will do the same.
Prudent Germans were the first to implement the policy in 1916 hoping to save energy. The US followed in 1918 during a fury of war-time rationing. Even then it was controversial. Farmers (who in a cruel ironic twist end up being blamed for the practice) actively lobbied against it. They must get up with the sun and their animals and found it disruptive they suddenly had to get to market an hour earlier. The retail industry was for it, vigorously lobbying against the farmers. But the political lure of offering people both more waking daylight and lower energy bills won out and many states adopted DST.There is no economic justification for DST.
There is no economic justification for DST. The primary benefit is the alleged energy saving, but it turns out the evidence is, at best, mixed on whether DST saves energy after all. Extending Day Light Saving a month in 2005 barely saved any energy. Meanwhile, another study found that when Illinois adopted DST in 2006, any energy saving was more than canceled out by people using their air-conditioning for more hours.
And the costs are substantial. Changing time disrupts sleep, causing more heart attacks, strokes, traffic, on-the-job accidents (pdf), and lost productivity hours. The whole point of time zones is coordinating economic and social activities, but changing clocks causes confusion. The fact that different countries change their time on different days, and poorer countries don’t at all, makes international business and travel more difficult. The airlines estimate DST costs them $147 million dollars a year.
So if there is little benefit and significant costs, why do we continue with this practice?
Polls suggest Americans don’t see much value in the semi-annual time changes. But any policy, good or bad, is very hard to get rid of once it’s in place. Time zone expert and author of Spring Forward the Annual Madness of Day Light Saving Time Michael Downing, reckons there are two main reasons we can’t get rid of DST: a romance we have with long summer evenings and special interests. The pain of early mornings next week are long forgotten when you enjoy a evening bbq in July.The whole point of time zones is coordinating economic and social activities, but changing clocks causes confusion.
The powerful retail lobby, particularly recreation, bbq, and home and gardening remains invested in keeping DST. Longer nights mean people have more time to shop and go to baseball games (and use more gas—further cutting into the alleged energy savings). Downing says each year the convenience store lobby (a large supplier of gas) gives out gift bags to Congress to celebrate DST. He’s observed how every 20 years the federal government adds another month of DST—the last one in 2005, in part, because the sugar lobby wanted to extend trick or treating hours. And each time we extend DST, America becomes more out of sync with the rest of the world.
The anti-DST movement doesn’t have the organization to compete with the retail lobby. The American economy has changed since the early days of DST. Now, retailers wield more power than the traditional voice of opposition, farmers. Downing points out that by 2000 more Americans lived on golf courses than farms.
Technology could prompt a change as people live more virtually from their homes, which may weaken the retail lobby’s need to keep DST. Downing also thinks that as more people use their smartphones as clocks (which update time change automatically) and alarms, they’ll become less engaged with time changes. He speculates the new technology may change the time conversation.Any policy, good or bad, is very hard to get rid of once it’s in place.
Right now ending DST falls to individual states. This creates a coordination failure that ensures DST is here to stay. The purpose of time is to facilitate economic and social activities through better coordination. But if your state is one of a handful to go off DST, you are further out of sync with your neighbors you do business with. Hawaii can get away with it because its already on its own time zone and near the equator. Arizona may have pulled it off, but being contrarian is core to its state-wide identity.
A few bold legislators in other states have tried end DST recently. Both Utah and California have bills proposing its end. In 2013 Missouri tried to end Day Light Saving, contingent on 19 states doing the same—effectively folding Central time into Eastern time (a wonderful idea in my opinion). But it never went anywhere. Utah Representative Mike McKell says of his DST ending efforts, “People really dislike changing,” he says.
Originally states and cities set their own DST schedules, but it created confusion and chaos. It took an act of Congress in 1966 for there to be a fixed 6-month period where states (it’s now 8 months) could choose to observe DST. It would take another act of Congress to break the cycle and get all states off this madness. But special interests and inertia keep us trapped in what economists call “a sub-optimal equilibrium.” According to Downing, “It’s ridiculous no one knows what time it is.”