The Economic Returns of Siesta: Evidence from China

Researchers have studied the economic consequences of social habits extensively in recent years. The practice of afternoon siesta, which was once a prevailing habit in many parts of the world, remains prominent in China and has not yet been investigated. This study takes the first step by examining the relationship between siesta and workers’ wage rates. From a human capital perspective, that siesta can potentially improve workers’ productivity and labor market outcomes. A fixed-effect model investigates the effect of siesta on wage rates based on data from 2010–2018 China Family Panel Studies (CFPS). The Heckman sample selection model is further used to address the sample selection, and a new instrumental variable is constructed to obtain causal estimates using exogenous variations in individual siesta habits caused by temperature and the local prevalence of siesta. The results indicate that siesta has a significant positive effect on workers’ wage rates, and alternative explanations, such as commute time and physical activities, do not weaken such effects. Explorative mechanism analyses suggest that the practice of siesta may influence wage rates through mitigating workers’ depression and enhancing their mental health.