Think of iPads versus electricity and cloud computing versus the railroad.
Hence, we can expect to see slowing growth in GDP per capita as future productivity gains will take much more effort to unlock.
This week The Economist took up this line of thought with a thorough briefing on the subject that broadly agreed with Cowen, although with some equivocation.
Overall, I think the argument has a lot of merit but there may be at least one more piece of low hanging fruit: a vast reduction in our need for sleep.
The American Time Use survey reports that an average American work day includes 8.8 hours of work and 7.6 hours of sleep.
Sleep is the second largest single use of time. However, new drugs such as Modafinil appear to vastly reduce the need for sleep without significant side effects (at least so far).
Based on reports from users, it seems that people could realistically [edit: potentially (see update)] cut their sleep requirements to as few as 2.5 hours a night without a decrease in mental acuity. That gives us another 5 hours to distribute over the day.
Workers would probably prefer to allocate the bulk of that extra time to leisure but I doubt employers will let that happen.
Let's make a generous breakdown and give work an extra 3 hours and let workers spend another 2 as they wish. This increases working hours by around 34% and potentially increases leisure time by 80%.
This increases the number of hours a worker spends at work from around 1800 hours a year now to about 2,400.
The argument against the use of drugs such as Modafinil, is that a rapid introduction of these pills would amount to an increase in the labour supply and cause a fall in hourly wages or unemployment.
However, it's likely that individuals would generally still see an increase in their overall income and their additional leisure time (2 hours extra) would allow this to be translated into an increase in demand in the economy through increased consumption.
Overall the transition to a sleepless world seems beneficial to humanity. There's nothing special about the 7 hours of sleep we get right now and I think people would rightly be opposed to a change that made everyone spend an extra hour asleep every day.
Caveats:
- I've never used Modafinil. This is because I don't know where to buy it, I have some moral qualms about using it when the rest of the world is not and because it is still a bit early to conclude that there are no long term health effects;
- Some people I've talked to have raised the issue of environmental damage. I think the total environmental impact of a sleepless world could be positive or negative but surely the damage would be lower per unit of output (because there are a lot of fixed carbon outputs per work day such as commuting and building overheads). At the very least, a sleepless world looks like a more environmentally friendly growth strategy;
- This argument is premised on the safety of these drugs. Clearly the calculus will change if they are shown to have negative long term consequences;
- For those people who already work long hours with little sleep, these drugs should at least make that lifestyle less dangerous. There is convincing evidence that chronic lack of sleep is harmful in normal circumstances;
- The precise amount of sleep that a Modafinil user can get by with seems to vary but all sources I've seen suggest it is dramatically lower;
- The short term costs of a rapid change might be substantial so gradual adoption is probably preferable from the standpoint of welfare.
Real the full article here
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