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Does Work Time Flexibility Work? An Empirical Assessment of the Efficiency Effects for German Firms

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  • Wolf, Elke
  • Beblo, Miriam
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    Abstract

    In this paper we assess the impact of flexible work time schedules on firm efficiency using representative establishment data for Germany. Following the approach by Battese and Coelli (1995), we estimate a stochastic production frontier and the determinants of technical efficiency simultaneously. The innovation of our study is that we draw on technical efficiency instead of productivity to appraise the success of flexible working hours. The results indicate that while the use of work time schedules with moderate flexibility is positively related to technical efficiency, highly flexible work time arrangements seem to be negatively correlated with an efficient organization of the work flow. However, these efficiency losses should not be interpreted as causal effects, because highly flexible work time schedules are most likely to be introduced in struggling firms. --

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    Bibliographic Info

    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 04-47.

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    Date of creation: 2004
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    Handle: RePEc:zbw:zewdip:2186

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    Related research

    Keywords: Stochastic production frontier; flexible work hours; efficiency;

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    1. Zvi Griliches & Jacques Mairesse, 1995. "Production Functions: The Search for Identification," Harvard Institute of Economic Research Working Papers 1719, Harvard - Institute of Economic Research.
    2. Schank, Thorsten & Schnabel, Claus & Wagner, Joachim, 2002. "Works Councils – Sand or Grease in the Operation of German Firms?," IZA Discussion Papers 648, Institute for the Study of Labor (IZA).
    3. Paul Osterman, 1994. "How common is workplace transformation and who adopts it?," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(2), pages 173-188, January.
    4. Ichniowski, Casey & Shaw, Kathryn & Prennushi, Giovanna, 1997. "The Effects of Human Resource Management Practices on Productivity: A Study of Steel Finishing Lines," American Economic Review, American Economic Association, vol. 87(3), pages 291-313, June.
    5. Zwick, Thomas & Wolf, Elke, 2002. "Reassessing the Impact of High Performance Workplaces," ZEW Discussion Papers 02-07, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    6. Douglas L. Kruse, 1993. "Profit Sharing: Does It Make a Difference?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ps, December.
    7. Nickell, S. & Nicolitasa, D. & Patterson, M., 1995. "Does Doing Badly Encourage Management Innovation?," Economics Series Working Papers 99175, University of Oxford, Department of Economics.
    8. Kumbhakar, Subal C & Ghosh, Soumendra & McGuckin, J Thomas, 1991. "A Generalized Production Frontier Approach for Estimating Determinants of Inefficiency in U.S. Dairy Farms," Journal of Business & Economic Statistics, American Statistical Association, vol. 9(3), pages 279-86, July.
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