May 2020

IZA DP No. 13242: Sleep Restriction Increases Coordination Failure

When group outcomes depend on minimal effort (e.g., disease containment, work teams, or indigenous hunt success), a classic coordination problem exists. Using a well-established paradigm, we examine how a common cognitive state (insufficient sleep) impacts coordination outcomes. Our data indicate that insufficient sleep increases coordination failure costs, which suggests that the sleep or, more generally, cognitive composition of a group might determine its ability to escape from a trap of costly miscoordination and wasted cooperative efforts. These findings are first evidence of the potentially large externality of a commonly experienced biological state (insufficient sleep) that has infiltrated many societies.