Business Daily Media

Daylight saving can boost the economy but Australia needs to make it uniform

  • Written by Andrew C. Worthington, Professor of Finance, Department of Accounting, Finance and Economics, Griffith University

When we compare daylight saving across countries, states and territories its economic impact is mostly positive. But this breaks down in the “transition” in and out of it, such as the days before and after[1], and when people cross borders[2] between states that have daylight saving and those that don’t.

The easiest way to resolve this would be for daylight saving to be applied uniformly across Australia as it is in nearly every other country that has it.

The problem in Australia is unique. While a similar size, the European Union has just three time zones year round, with the shift to and from daylight saving time synchronised throughout since 1996. Likewise the mainland United States has four time zones, with uniform daylight saving everywhere but Arizona.

When daylight saving ends in Australia, the country will revert from five different time zones to three. The time difference between the east and west coast will also change from three to two hours.

Read more: Start resetting your kids' body clocks before daylight saving ends – here's how[3]

Daylight saving time positively affects the economy in a number of ways. It reduces street crime in darkly lit streets[4], for instance, which means less costly and better targeted policing.

Decreased home energy consumption[5] leads to lower household bills. More people being out and about in the evenings boosts local economies[6] through increased spending in shops and restaurants.

This at least partially explains why there is an ongoing debate about adopting daylight saving in states that do not have it, such as in Queensland[7] and to a lesser extent in Western Australia[8].

Problems in transition

However, the transitions to and from daylight saving time (setting clocks forward or back, or moving between states with and without daylight saving) has economic costs. Many of these are associated with increased health care, but also include lost earnings and higher insurance costs.

One problem is that there is a “daylight saving effect” linked to changes in circadian rhythms[9] and a (negative) effect on sleep patterns. As with jet lag, the movement to daylight saving time compresses the day, while the movement away stretches it.

Research has linked changes to and from daylight saving time with sudden changes in biological rhythms. Swedish data show[10] a significant increase in heart attacks for the first few days after the introduction of daylight saving time and again, but for a shorter period, following its end.

A United States study[11] found that pedestrians were nearly seven times more likely to be injured following transitions to and from daylight saving. A Canadian study[12] suggested a significant increase (up to 8%) in accident risk on the Mondays following the spring and autumn daylight saving time changes.

Read more: Is daylight saving time worth the trouble? Research says no[13]

In the United States[14] (but not Australia[15]) the daylight saving transition period has also been linked to stockmarket participants suffering greater anxiety, preferring safer investments and shunning risk. This pushes down stock prices and lowers returns, meaning everyone with superannuation loses out.

There is also evidence[16] that the “artificial” daylight saving transition when crossing the Queensland–New South Wales border imposes significant costs on businesses. The study found that Gold Coast businesses lose sales and have higher administration costs because of it.

Businesses throughout Queensland[17] believe that its failure to adopt daylight saving time has a negative influence on the functioning and performance of the state economy.

Simplifying time zones

Ultimately, Australia needs to simplify what is one of the world’s most fragmented national set of time zones.

The administration costs of scheduling business across time zones, and through the transition, are a burden on business. This has an economic cost in terms of lost profits (and therefore taxation), as well as employment.

While technology has no doubt made this co-ordination easier, research in the United States[18] still suggests that economies are more productive when there is greater time co-ordination. This is a strong argument for countries having as few time zones as possible.

In the United States, some are advocating[19] fewer time zones, or even year-round daylight saving time[20], to avoid the costly transition twice a year.

Here in Australia, introducing daylight saving in Queensland would avoid significant business co-ordination problems with the other eastern states, especially for the highly populated southeast. There would be similar benefits for Western Australian and the Northern Territory.

While getting rid of daylight saving altogether would also remove these transition costs, its economic benefits suggest it would be much better for daylight saving to be adopted throughout Australia.

References

  1. ^ days before and after (www.aeaweb.org)
  2. ^ when people cross borders (www.sciencedirect.com)
  3. ^ Start resetting your kids' body clocks before daylight saving ends – here's how (theconversation.com)
  4. ^ street crime in darkly lit streets (www.mitpressjournals.org)
  5. ^ Decreased home energy consumption (mpra.ub.uni-muenchen.de)
  6. ^ boosts local economies (www.sciencedirect.com)
  7. ^ Queensland (www.couriermail.com.au)
  8. ^ Western Australia (www.abc.net.au)
  9. ^ circadian rhythms (sleepfoundation.org)
  10. ^ Swedish data show (www.nejm.org)
  11. ^ study (www.sciencedirect.com)
  12. ^ study (journals.sagepub.com)
  13. ^ Is daylight saving time worth the trouble? Research says no (theconversation.com)
  14. ^ United States (www.aeaweb.org)
  15. ^ not Australia (onlinelibrary.wiley.com)
  16. ^ evidence (www.sciencedirect.com)
  17. ^ throughout Queensland (www.sciencedirect.com)
  18. ^ research in the United States (www.iza.org)
  19. ^ some are advocating (qz.com)
  20. ^ year-round daylight saving time (www.businessinsider.com.au)

Authors: Andrew C. Worthington, Professor of Finance, Department of Accounting, Finance and Economics, Griffith University

Read more http://theconversation.com/daylight-saving-can-boost-the-economy-but-australia-needs-to-make-it-uniform-93727

Business Reports

TIP Group grows; appoints new senior executives

Teaminvest Private Group Limited (ASX:TIP) has appointed two new senior executives to further accelerate the company’s growth. Timothy Wong has been appointed Head of TIP Equity (the company’s private equity division) and...

What to Look for in a Point of Sale System

When you're looking for a point of sale system for your business, there are a lot of things to consider. What type of business do you have? How many employees do you have? What features are important to you? In this blog post...

Why Roe v. Wade's demise – unlike gay rights or Ukraine – isn't getting corporate America to speak up

Many Americans reacted with outrage to the Supreme Court's decision to dismantle the constitutional right to abortion.AP Photo/Rick BowmerCorporate America – once known for carefully avoiding public stances on hot button iss...

Donating to help women get abortions is a First Amendment right – protected by Supreme Court precedents

An abortion provider in San Antonio had to turn patients away after the June 24, 2022, Supreme Court ruling. Gina Ferazzi/Los Angeles Times via Getty ImagesSeveral Texas abortion funds – which are charities that help people...

Feeling down and unmotivated at work? Insights show that it’s the space you’re in

It may come as a surprise, but over your lifetime you will spend an average of 90,000 hours on the job, according to data in the study, Happiness at Work1. This will likely equate to a whopping one-third of your life, between ...

Why focusing on social impact is good for business

How can social impact and behaviour change programs create ongoing and meaningful benefit to businesses and government? This is a question that drives our work at Atria Group and is something that I am personally passionate ...



NewsServices.com

Content & Technology Connecting Global Audiences

More Information - Less Opinion