Sunday, November 7, 2010

Daylight Time and Other Gimmicks

Time is an illusion, and some of the simplest evidence for this is daylight time. In the United States, we adjusted our clocks last night, and this morning, there is more sunlight than yesterday morning. The sun rose an hour earlier, giving us more useful daylight hours — when compared to the clock, that is.

In reality, we know that the clock is nothing more than a very steady electronic or mechanical device. It tells us whatever we want it to tell us. The actual planetary rotation, or the movement of the sun across the sky, isn’t affected in the slightest by the way we set our clocks. So the appearance of more daylight this morning is an illusion.

Yet it is an economic significant illusion, with very small but measurable increases in economic production as a result of the gimmick of daylight time. In total, the gains from daylight time are less than the extra effort people put in adjusting the clocks, an effort that takes about two hours per year or about 0.1 percent of all the work that’s done in the country over the course of the year. The economic gains are real nonetheless, and large enough to be seen on a graph and debated by experts and policymakers.

It should be noted, however, that the gains are not really the result of the inherent virtue of daylight time. Daylight time itself is unproductive. The gains result only from forcing everyone to work an extra two hours per year. These gains would be greater if these two hours were spent on people’s usual work, or something else that is actually productive.

The important lesson here is that gimmicks and other illusions have real economic power. This is true not just in the economy at large, but also in your individual life. If you can employ a gimmick that gets you to feel good about doing an extra two hours of productive work per year, you can boost your own productivity — and your economic prospects along with it — by 0.1 percent. Employ several such gimmicks, and it’s like getting a raise.

Gimmicks work because they help you focus differently, or because they change your energy. This is especially obvious with the new year’s resolutions that help many people concentrate their energy and focus on solving a specific problem. Gimmicks might seem inconsequential, but they are big enough to matter. Often we struggle with or fight over economic distinctions of 1 percent or less. If a gimmick can help us gain that 1 percent without a struggle, so much the better.