Advanced Search
MyIDEAS: Login to save this paper or follow this series

Employed 40 Hours or Not Employed 39: Lessons from the 1982 Mandatory Reduction of the Workweek

Contents:

Author Info

  • Crépon, Bruno
  • Kramarz, Francis

Abstract

We use longitudinal individual wage, hours, and employment data to investigate the effect of the February 1, 1982 mandatory reduction of weekly working hours in France. Just after François Mitterrand's election in May 1981, the government decided to increase the minimum wage by 5%. Then, as promised in its electoral program, the socialist government reduced the workweek from 40 to 39 hours. At the same time, it mandated stable monthly earnings for minimum wage workers and recommended the stabilization of monthly earnings for other workers (recommendations followed by 90% of the firms). We show that workers directly affected by these changes - those working 40 hours in March 1981 - were more likely to lose their jobs between 1981 and 1982 than workers not affected by the changes - those working 36 to 39 hours in March 1981. Moreover, because the decree enforcing the new standard was issued faster than earlier promises, some firms had no time to complete negotiations and their workers were still working 40 hours after February 1, 1982. We show that these workers have also been strongly affected by the reduction in standard hours. Our estimates of the impact of this one-hour reduction of the workweek on employment losses vary between 2% and 4%, depending on the methodology or the data used. Furthermore, we show that minimum wage workers have been most affected by the changes. This result, consistent with our model, is due to the impossibility of adjusting their monthly wage which results in excess job destruction and creation. These results should help us understand the possible effects of the upcoming mandatory reduction of hours in France, where the maximum weekly working hours will gradually decline from 39 to 35 hours beginning in the year 2000. Similar projects are envisaged in other European countries, which hope that reductions in hours will be an efficient policy for reducing unemployment.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.cepr.org/pubs/dps/DP2358.asp
Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2358.

as in new window
Length:
Date of creation: Jan 2000
Date of revision:
Handle: RePEc:cpr:ceprdp:2358

Contact details of provider:
Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ.
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820

Order Information:
Email:

Related research

Keywords: Hours Reduction; Unemployment; Wages;

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Abowd, John M & Kramarz, Francis & Margolis, David N, 1999. "Minimum Wages and Employment in France and the United States," CEPR Discussion Papers 2159, C.E.P.R. Discussion Papers.
  2. Abowd, John M. & Kramarz, Francis & Margolis, David N. & Philippon, Thomas, 2000. "The Tail of Two Countries: Minimum Wages and Employment in France and the United States," IZA Discussion Papers 203, Institute for the Study of Labor (IZA).
  3. Hunt, Jennifer, 1997. "Has Work Sharing Worked in Germany?," CEPR Discussion Papers 1553, C.E.P.R. Discussion Papers.
  4. David Card & Francis Kramarz & Thomas Lemieux, 1999. "Changes in the Relative Structure of Wages and Employment: A Comparison of the United States, Canada, and France," Canadian Journal of Economics, Canadian Economics Association, vol. 32(4), pages 843-877, August.
  5. Bell, David N.F. & Blanchflower, David G., 2011. "Youth Unemployment in Europe and the United States," IZA Discussion Papers 5673, Institute for the Study of Labor (IZA).
  6. Calmfors, Lars & Hoel, Michael, 1988. " Work Sharing and Overtime," Scandinavian Journal of Economics, Wiley Blackwell, vol. 90(1), pages 45-62.
  7. Lechner, Michael, 1999. "Identification and Estimation of Causal Effects of Multiple Treatments Under the Conditional Independence Assumption," IZA Discussion Papers 91, Institute for the Study of Labor (IZA).
  8. Abowd, J.M. & Kramarz, F. & Margolis, D.N., 1995. "High-Wage Workers and High-Wage Firms," Cahiers de recherche 9503, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
  9. Simmons, R. & Schank, Thorsten & Andrews, Martyn J., 2004. "Does Worksharing Work? Some Empirical Evidence from the IAB Panel," Discussion Papers 25, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
  10. Francis Kramarz & Thomas Philippon, 2000. "The Impact of Differenctial Payroll Tax Subsidies on Minimum Wage Employment," Working Papers 2000-10, Centre de Recherche en Economie et Statistique.
  11. John M. Abowd & Francis Kramarz & Thomas Lemieux & David N. Margolis, 2000. "Minimum Wages and Youth Employment in France and the United States," NBER Chapters, in: Youth Employment and Joblessness in Advanced Countries, pages 427-472 National Bureau of Economic Research, Inc.
  12. Trejo, Stephen J, 1991. "The Effects of Overtime Pay Regulation on Worker Compensation," American Economic Review, American Economic Association, vol. 81(4), pages 719-40, September.
  13. Ehrenberg, Ronald G., 1971. "Heterogeneous labor, the internal labor market, and the dynamics of the employment-hours decision," Journal of Economic Theory, Elsevier, vol. 3(1), pages 85-104, March.
  14. James Heckman & Hidehiko Ichimura & Jeffrey Smith & Petra Todd, 1998. "Characterizing Selection Bias Using Experimental Data," NBER Working Papers 6699, National Bureau of Economic Research, Inc.
  15. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
  16. Guido W. Imbens, 1999. "The Role of the Propensity Score in Estimating Dose-Response Functions," NBER Technical Working Papers 0237, National Bureau of Economic Research, Inc.
  17. Olivier Marchand & Etienne Turpin & Daniel Rault, 1983. "Des 40 heures aux 39 heures : processus et réactions des entreprises," Économie et Statistique, Programme National Persée, vol. 154(1), pages 3-15.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Gebhard Kirchgässner, 2009. "Critical Analysis of Some Well-Intended Proposals to Fight Unemployment," University of St. Gallen Department of Economics working paper series 2009 2009-17, Department of Economics, University of St. Gallen.
  2. Kawaguchi, Daiji & Lee, Jungmin & Hamermesh, Daniel S., 2012. "A Gift of Time," IZA Discussion Papers 6700, Institute for the Study of Labor (IZA).
  3. Hamermesh, Daniel S., 2007. "Fun with Matched Firm-Employee Data: Progress and Road Maps," IZA Discussion Papers 2580, Institute for the Study of Labor (IZA).
  4. M. J. Andrews & T. Schank & R. Simmons, 2005. "Does Worksharing Work? Some Empirical Evidence From The Iab-Establishment Panel," Scottish Journal of Political Economy, Scottish Economic Society, vol. 52(2), pages 141-176, 05.
  5. Tomohiro Machikita, 2005. "Career Crisis? The Impacts of Financial Shock on Entry-Level Labour Market: Experimental Evidences from Thailand in 1997," Hi-Stat Discussion Paper Series d04-79, Institute of Economic Research, Hitotsubashi University.
  6. Giannelli, Gianna Claudia & Braschi, Cristina, 2002. "Reducing Hours of Work: Does Overtime Act as a Brake Upon Employment Growth? An Analysis by Gender for the Case of Italy," IZA Discussion Papers 557, Institute for the Study of Labor (IZA).
  7. Pierre Boisard, 2004. "Working time policy in France," Post-Print halshs-00400703, HAL.
  8. Chang, Juin-jen & Huang, Chun-chieh & Lai, Ching-chong, 2007. "Working hours reduction and wage contracting style in a dynamic model with labor adjustment costs," Journal of Economic Dynamics and Control, Elsevier, vol. 31(3), pages 971-993, March.
  9. Kuroda, Sachiko, 2009. "Do Japanese Work Shorter Hours than before?: Measuring Trends in Market Work and Leisure Using 1976-2006 Japanese Time-Use Survey," PIE/CIS Discussion Paper 419, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
  10. Skans, Oskar Nordstrom, 2004. "The impact of working-time reductions on actual hours and wages: evidence from Swedish register-data," Labour Economics, Elsevier, vol. 11(5), pages 647-665, October.
  11. Philippe Askenazy, 2013. "Working time regulation in France from 1996 to 2012," Cambridge Journal of Economics, Oxford University Press, vol. 37(2), pages 323-347.
  12. Altavilla, Carlo & Garofalo, Antonio & Vinci, Concetto Paolo, 2005. "Evaluating the effects of working hours on employment and wages," Journal of Policy Modeling, Elsevier, vol. 27(6), pages 647-664, September.
  13. Machikita, Tomohiro, 2006. "Career Crisis? Impacts of Financial Shock on the Entry-Level Labor Market: Evidence from Thailand," IDE Discussion Papers 83, Institute of Developing Economies, Japan External Trade Organization(JETRO).

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:2358. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.