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Long-Term Effects of Unpaid Overtime: Evidence for West Germany

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  • Pannenberg, Markus

    (Bielefeld University of Applied Sciences)

Abstract

Why do people work unpaid overtime? We show that remarkable long-term labor earnings gains are associated with unpaid overtime in West Germany. A descriptive analysis suggests that over a 10-year period workers with unpaid overtime experience on average at least a 10 percentage points higher increase in real labor earnings than their co-workers. Applying panel data models this result generally holds. Furthermore, we find some evidence for gender specific differences with respect to the effects of unpaid overtime work. Our results point to the importance of investment in current working hours beyond the standard work week to enhance real earnings prospects.

Suggested Citation

  • Pannenberg, Markus, 2002. "Long-Term Effects of Unpaid Overtime: Evidence for West Germany," IZA Discussion Papers 614, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp614
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    References listed on IDEAS

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    1. Thomas Bauer & Klaus F. Zimmermann, 1999. "Overtime Work and Overtime Compensation in Germany," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(4), pages 419-436, September.
    2. David N. F. Bell & Robert A. Hart, 1999. "Unpaid Work," Economica, London School of Economics and Political Science, vol. 66(262), pages 271-290, May.
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    6. Bell, David N F & Hart, Robert A, 1999. "Unpaid Work," Economica, London School of Economics and Political Science, vol. 66(262), pages 271-290, May.
    7. 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 of Labor Economics (IZA).
    8. Bell, Linda A. & Freeman, Richard B., 2001. "The incentive for working hard: explaining hours worked differences in the US and Germany," Labour Economics, Elsevier, vol. 8(2), pages 181-202, May.
    9. Arellano, M, 1987. "Computing Robust Standard Errors for Within-Groups Estimators," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 49(4), pages 431-434, November.
    10. Bauer, Thomas & Zimmermann, Klaus F, 1999. "Overtime Work and Overtime Compensation in Germany," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(4), pages 419-436, September.
    11. Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2003. "A sticky floors model of promotion, pay, and gender," European Economic Review, Elsevier, vol. 47(2), pages 295-322, April.
    12. SOEP Group, 2001. "The German Socio-Economic Panel (GSOEP) after More than 15 Years: Overview," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 70(1), pages 7-14.
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    Cited by:

    1. Simon Fietze & Elke Holst & Verena Tobsch, 2011. "Germany’s Next Top Manager: Does Personality Explain the Gender Career Gap?," management revue. Socio-economic Studies, Rainer Hampp Verlag, vol. 22(3), pages 240-273.
    2. Jurajda, Stepan & Harmgart, Heike, 2007. "When do female occupations pay more?," Journal of Comparative Economics, Elsevier, vol. 35(1), pages 170-187, March.
    3. Jurajda, Štepán & Harmgart, Heike, 2004. "When Are ‘Female’ Occupations Paying More?," IZA Discussion Papers 985, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    overtime; linear panel data models; overtime compensation; labour earnings;
    All these keywords.

    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

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