Revisiting the neoclassical theory of labour supply – Disutility of labour, working hours, and happiness
AbstractIn empirical analyses, employment status has a substantial influence on individual wellbeing. People without work are consistently less happy, even after controlling for income. This result seems to contradict the standard theory assumption of labour disutility. In this paper, we analyze the impact of working time on happiness. The results show distinct positive utility effects caused by employment and working time. Happiness correlates positively with hours worked. However, there is an inverse U-shaped correlation – excessive hours reverse the relationship. Additionally, the results show the importance of exogenously given deviations of working time from the individually preferred labour supply. These discrepancies reduce well-being and counterbalance the positive effects of work.
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Bibliographic InfoPaper provided by Otto-von-Guericke University Magdeburg, Faculty of Economics and Management in its series FEMM Working Papers with number 09005.
Length: 28 pages
Date of creation: Feb 2009
Date of revision:
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More information through EDIRC
Labour Supply; Working Hours; Happiness; Life Satisfaction;
Find related papers by JEL classification:
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
- D60 - Microeconomics - - Welfare Economics - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-05-23 (All new papers)
- NEP-HAP-2009-05-23 (Economics of Happiness)
- NEP-LAB-2009-05-23 (Labour Economics)
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