Do you really need a nap?
Exercise
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Sleeping seems to be one of the basic necessities that shouldn’t be traded-off for anything else. Empirical studies demonstrate, however, that the time dedicated to sleep decreases the higher the value of it. People with high income sleep less. (They also spend less time having fun and are less faithful to their husband/wife.) The empirical estimations show that the time dedicated to sleep decreases 1 per cent for every 20 per cent increase in salary (Biddle and Hamermesh, 1989). Analyze this result. Does it contradict the fact that people in rich countries sleep more than people in poor countries? Can the concepts of income effect and substitution effect help in answering this question?
Analysis
Conduct with respect to sleeping is given by the opportunity cost of time, and this cost is proxied by personal income. In addition, it seems that, above a certain point, the substitution effect is more than compensated by the income effect, which explains that in rich countries people sleep more than in poor countries. (See also The Economist, July 29th, 1989, p. 60).
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