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Overtime Work, Overtime Compensation and the Distribution of Economic Well-Being Evidence for the West Germany and Great Britain

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Author Info
Pannenberg, Markus () (DIW Berlin)
Wagner, Gert G. (DIW Berlin)

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Abstract

Using panel data for West Germany and Great Britain, we show that there are striking differences in overtime work and overtime compensation in the two countries in the 1990s. Our estimates reveal that the observed overtime patterns affect both the evolution of the monthly labour earnings distribution and individual economic well-being differently in West Germany and Great Britain. Besides varying labour market institutions in the two countries a higher incidence of a combination of performance-related pay and unpaid overtime in Great Britain is an important factor in explaining the observed differences. With regards to West Germany, we show that the current policy of transforming paid overtime in "working time accounts", which is conducted in the spirit of "work-sharing", is neither beneficial for employed workers in terms of income mobility, nor in terms of overall job satisfaction nor in terms of working time preferences.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 318.

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Length: 35 pages
Date of creation: Jun 2001
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Handle: RePEc:iza:izadps:dp318

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Related research
Keywords: Overtime; wage inequality; economic well-being; semi-parametric decomposition technique; panel data;

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Find related papers by JEL classification:
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods

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.:

  1. Bell, Brian D & Pitt, Michael K, 1998. "Trade Union Decline and the Distribution of Wages in the UK: Evidence from Kernel Density Estimation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 60(4), pages 509-28, November.
  2. Bauer, Thomas & Zimmermann, Klaus F., 1999. "Overtime Work and Overtime Compensation in Germany," IZA Discussion Papers 48, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  3. Bell, David N. F. & Hart, Robert A., 1999. "Overtime Working in an Unregulated Labour Market," IZA Discussion Papers 44, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  4. Akerlof, George A, 1982. "Labor Contracts as Partial Gift Exchange," The Quarterly Journal of Economics, MIT Press, vol. 97(4), pages 543-69, November. [Downloadable!] (restricted)
  5. Clark, Andrew E., 1999. "Are wages habit-forming? evidence from micro data," Journal of Economic Behavior & Organization, Elsevier, vol. 39(2), pages 179-200, June. [Downloadable!] (restricted)
  6. Bell, D. & Hart, R.A., 1998. "Unpaid Work," Working Papers Series 9803, University of Stirling, Department of Economics.
    Other versions:
    • Bell, David N F & Hart, Robert A, 1999. "Unpaid Work," Economica, London School of Economics and Political Science, vol. 66(262), pages 271-90, May. [Downloadable!] (restricted)
  7. Hamermesh, Daniel S., 1999. "The Changing Distribution of Job Satisfaction," IZA Discussion Papers 42, Institute for the Study of Labor (IZA). [Downloadable!]
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  8. Bell, David N. F. & Hart, Robert A. & Hübler, Olaf & Schwerdt, Wolfgang, 2000. "Paid and Unpaid Overtime Working in Germany and the UK," IZA Discussion Papers 133, Institute for the Study of Labor (IZA). [Downloadable!]
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Cited by:
(explanations, 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.)

  1. C. Praag & Peter Versloot, 2007. "What is the value of entrepreneurship? A review of recent research," Small Business Economics, Springer, vol. 29(4), pages 351-382, December. [Downloadable!] (restricted)
    Other versions:
  2. Giannelli, Gianna C. & 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). [Downloadable!]
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