Firm's demand for work hours: Evidence from multi-country and matched firm-worker data
AbstractUsing information on Japanese, UK, and German workers' work hour and matched firms' characteristics, this paper investigates whether the number of hours worked is determined by demand-side factors, and tries to introduce one possibility to explain why Japanese tend to work longer hours than workers in other countries. Based on an empirical framework that each firm sets a minimum boundary of work hours, and workers hired by the firm are not able to work less than the minimum requirement, we found that the minimum requirement depends on the fixed costs of labor that the firm bears. Specifically, firms that tend to conduct labor hoarding during recessions, presumably because of higher fixed costs, require incumbent workers to work longer hours. We also found that the greater the workers' firm-specific skills, the more firms placed demands on these workers to work longer hours, given other things are equal. Since Japanese firms have long been considered to bear large fixed costs to train workers, we interpret the long work hour requirement as a rational strategy for Japanese firms to protect those workers that have accumulated high skills from dismissal. In other words, the long work hours of Japanese workers reflect the practice of long-term employment, a typical feature of the Japanese labor market.
Download InfoIf 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.
Bibliographic InfoPaper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 11024.
Length: 28 pages
Date of creation: Mar 2011
Date of revision:
Contact details of provider:
Postal: 11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901
Web page: http://www.rieti.go.jp/
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-09 (All new papers)
- NEP-BEC-2011-04-09 (Business Economics)
- NEP-HRM-2011-04-09 (Human Capital & Human Resource Management)
- NEP-LAB-2011-04-09 (Labour Economics)
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.:
- Kuroda, Sachiko & Yamamoto, Isamu, 2008.
"Estimating Frisch labor supply elasticity in Japan,"
Journal of the Japanese and International Economies,
Elsevier, vol. 22(4), pages 566-585, December.
- Sachiko Kuroda & Isamu Yamamoto, 2007. "Estimating Frisch Labor Supply Elasticity in Japan," IMES Discussion Paper Series 07-E-05, Institute for Monetary and Economic Studies, Bank of Japan.
- Kuroda, Sachiko & Yamamoto, Isamu, 2003. "Are Japanese Nominal Wages Downwardly Rigid? (Part I): Examinations of Nominal Wage Change Distributions," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 21(2), pages 1-29, August.
- Martinez-Granado, Maite, 2005. "Testing labour supply and hours constraints," Labour Economics, Elsevier, vol. 12(3), pages 321-343, June.
- Katharine G. Abraham & Susan N. Houseman, 1992.
"Job Security and Work Force Adjustment: How Different are U.S. and Japanese Practices?,"
Book chapters authored by Upjohn Institute researchers,
in: Giorgio Galeazzi & Daniel Hamermesh (ed.), Dynamic Labor Demand and Adjustment Costs, pages 280-301
W.E. Upjohn Institute for Employment Research.
- Katharine G. Abraham & Susan N. Houseman, 1993. "Job Security and Work Force Adjustment: How Different are U.S. and Japanese Practices?," Book chapters authored by Upjohn Institute researchers, in: Christopher F. Buechtemann (ed.), Employment Security and Labor Market Behavior: Interdisciplinary Approaches and International Evidence, pages 180-199 W.E. Upjohn Institute for Employment Research.
- Abraham, Katharine G. & Houseman, Susan N., 1989. "Job security and work force adjustment: How different are U.S. and Japanese practices?," Journal of the Japanese and International Economies, Elsevier, vol. 3(4), pages 500-521, December.
- Katharine G. Abraham & Susan N. Houseman, . "Job Security and Work Force adjustment: How Different are U.S. and Japanese Practices?," Upjohn Working Papers and Journal Articles kgasnh1989, W.E. Upjohn Institute for Employment Research.
- Katharine G. Abraham & Susan N. Houseman, 1990. "Job Security and Work Force Adjustment: How Different are U.S. and Japanese Practices?," NBER Working Papers 3155, National Bureau of Economic Research, Inc.
- Denise J. Doiron, 2003. "Is Under-Employment due to Labour Hoarding? Evidence from the Australian Workplace Industrial Relations Survey," The Economic Record, The Economic Society of Australia, vol. 79(246), pages 306-323, 09.
- repec:ese:iserwp:2004-25 is not listed on IDEAS
- Kuroda, Sachiko & Yamamoto, Isamu, 2003. "Are Japanese Nominal Wages Downwardly Rigid? (Part II): Examinations Using a Friction Model," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 21(2), pages 31-68, August.
- repec:ese:iserwp:2002-28 is not listed on IDEAS
- Kato, Takao, 2001. "The End of Lifetime Employment in Japan?: Evidence from National Surveys and Field Research," Journal of the Japanese and International Economies, Elsevier, vol. 15(4), pages 489-514, December.
- Kahn, Shulamit & Lang, Kevin, 1991.
"The Effect of Hours Constraints on Labor Supply Estimates,"
The Review of Economics and Statistics,
MIT Press, vol. 73(4), pages 605-11, November.
- Shulamit Kahn & Kevin Lang, 1988. "The Effects of Hours Constraints on Labor Supply Estimates," NBER Working Papers 2647, National Bureau of Economic Research, Inc.
- Shulamit Kahn & Kevin Lang, 1992. "Constraints on the Choice of Work Hours: Agency Versus Specific-Capital," Journal of Human Resources, University of Wisconsin Press, vol. 27(4), pages 661-678.
- Mark L Bryan, 2007.
"Workers, Workplaces and Working Hours,"
British Journal of Industrial Relations,
London School of Economics, vol. 45(4), pages 735-759, December.
- Mark L. Bryan, 2007.
"Free to choose? Differences in the hours determination of constrained and unconstrained workers,"
Oxford Economic Papers,
Oxford University Press, vol. 59(2), pages 226-252, April.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (NUKATANI Sorahiko).
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.