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Does Worksharing Work? Some Empirical Evidence from the IAB Panel

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  • Simmons, R.
  • Schank, Thorsten
  • Andrews, Martyn J.

Abstract

Recent policy debate in Europe suggests that a shorter workweek will lead to more jobs (worksharing). We derive and estimate a model where the firm employs two types of worker, some working overtime, the rest standard hours. Worksharing is not always a prediction of the theory. Using German establishment-level panel data (the IAB panel), 1993-1999, we find pro-worksharing effects in small plants in the East German non-service sector. There is evidence that a cut in standard hours lowers the proportion of overtime workers in a plant, as predicted by the theory, and increases the proportion of standard-time plants. -- In der wirtschaftspolitischen Debatte werden immer wieder Ver- kürzungen der wöchentlichen Normalarbeitszeit zur Bekämpfung der Arbeitslosigkeit gefordert. Wir präsentieren in dem vorliegenden Papier ein Arbeitsnachfragemodell, das zwischen Beschäftigten mit und ohne Überstunden unterscheidet. Der Effekt einer Arbeitszeitverkürzung auf die Beschäftigung kann dabei nicht eindeutig beantwortet werden. Auf der Basis des IAB-Betriebspanels, 1993-1999, finden wir, dass in kleinen Betrieben des Produzierenden Gewerbes Ostdeutschlands Arbeitszeitverkürzungen und Beschäftigungserhöhungen miteinander einhergingen. Au?erdem zeigt sich, dass eine Verkürzung der wöchentlichen Arbeitszeit den Anteil der Überstundenbeschäftigten - so wie von der Theorie vorhergesagt - senkt und den Anteil der Betriebe ohne Überstunden erhöht.

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Bibliographic Info

Paper provided by Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics in its series Discussion Papers with number 25.

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Date of creation: 2004
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Handle: RePEc:zbw:faulre:25

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Web page: http://www.arbeitsmarkt.wiso.uni-erlangen.de/english-version/
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Related research

Keywords: worksharing; plant-level panel data; Germany;

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References

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  1. Andrews, M J & Simmons, R, 2001. "Friday May Never Be the Same Again: Some Results on Work-Sharing from Union-Firm Bargaining Models," Scottish Journal of Political Economy, Scottish Economic Society, vol. 48(5), pages 488-516, November.
  2. Jennifer Hunt, 1998. "Hours Reductions as Work-Sharing," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 29(1), pages 339-381.
  3. Tor Jacobson & Henry Ohlsson, 2000. "Working time, employment, and work sharing: Evidence from Sweden," Empirical Economics, Springer, vol. 25(1), pages 169-187.
  4. Bell, D. & RA Hart, 1999. "Overtime Working in an Unregulated Labour Market," Working Papers Series 9904, University of Stirling, Division of Economics.
  5. Robert A Hart & Robin J Ruffell, 1992. "The Cost of Overtime Hours in British Production Industries," Working Papers Series 92/1, University of Stirling, Division of Economics.
  6. Blundell, Richard & Macurdy, Thomas, 1999. "Labor supply: A review of alternative approaches," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 27, pages 1559-1695 Elsevier.
  7. Mary Gregory & Adriaan S. Kalwij, 2000. "Overtime Hours in Great Britain Over the Period 1975-1999: A Panel Data Analysis," Economics Series Working Papers 27, University of Oxford, Department of Economics.
  8. Hunt, Jennifer, 1997. "Has Work Sharing Worked in Germany?," CEPR Discussion Papers 1553, C.E.P.R. Discussion Papers.
  9. Leslie, Derek, 1991. "Modelling Hours of Work in a Labour Services Function," Scottish Journal of Political Economy, Scottish Economic Society, vol. 38(1), pages 19-31, February.
  10. Kapteyn, A. & Kalwij, A.S. & Zaidi, M.A., 2000. "The Myth of Worksharing," Discussion Paper 2000-23, Tilburg University, Center for Economic Research.
  11. Bauer, Thomas K. & Zimmermann, Klaus F., 1999. "Overtime Work and Overtime Compensation in Germany," IZA Discussion Papers 48, Institute for the Study of Labor (IZA).
  12. Hart, Robert A. & Malley, James R. & Ruffell, Robin J., 1996. "What shapes are overtime premium schedules? Some evidence from Japan, the UK, and the US," Economics Letters, Elsevier, vol. 53(1), pages 97-102, October.
  13. Brunello, Giorgio, 1989. "The Employment Effects of Shorter Working Hours: An Application to Japanese Data," Economica, London School of Economics and Political Science, vol. 56(224), pages 473-86, November.
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Cited by:
  1. Altavilla, Carlo & Garofalo, Antonio & Vinci, Concetto Paolo, 2005. "Evaluating the effects of working hours on employment and wages," Journal of Policy Modeling, Elsevier, vol. 27(6), pages 647-664, September.
  2. Bruno Crepon & Francis Kramarz, 2002. "Employed 40 Hours or Not Employed 39: Lessons from the 1982 Mandatory Reduction of the Workweek," Journal of Political Economy, University of Chicago Press, vol. 110(6), pages 1355-1389, December.
  3. Friesen, Jane, 2001. "Overtime pay regulation and weekly hours of work in Canada," Labour Economics, Elsevier, vol. 8(6), pages 691-720, December.
  4. Schank, Thorsten & Schnabel, Claus, 2004. "Betriebliche Determinanten des Überstundeneinsatzes," Discussion Papers 24, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.

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