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Work and Leisure in the US and Europe: Why So Different?

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Author Info
Alesina, Alberto F
Glaeser, Edward L
Sacerdote, Bruce

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Abstract

Americans average 25.1 working hours per person in working age per week, but the Germans average 18.6 hours. The average American works 46.2 weeks per year, while the French average 40 weeks per year. Why do western Europeans work so much less than Americans? Recent work argues that these differences result from higher European tax rates, but the vast empirical labour supply literature suggests that tax rates can explain only a small amount of the differences in hours between the US and Europe. Another popular view is that these differences are explained by long-standing European ‘culture’, but Europeans worked more than Americans as late as the 1960s. In this paper, we argue that European labour market regulations, advocated by unions in declining European industries who argued ‘work less, work all’ explain the bulk of the difference between the US and Europe. These policies do not seem to have increased employment, but they may have had a more society-wide influence on leisure patterns because of a social multiplier where the returns to leisure increase as more people are taking longer vacations.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5140.

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Date of creation: Jul 2005
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Handle: RePEc:cpr:ceprdp:5140

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Related research
Keywords: europe; hours worked; labour unions; taxation;

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Find related papers by JEL classification:
E00 - Macroeconomics and Monetary Economics - - General - - - General
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

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