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Does Worksharing Work? Some Empirical Evidence From The Iab-Establishment Panel

  • M. J. Andrews
  • T. Schank
  • R. Simmons

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 workers, some working overtime, the rest standard hours. Worksharing is not always a prediction of the theory. Using German establishment-level panel data (the IAB-ESTABLISHMENT panel), 1993-1999, we find no evidence of pro-worksharing effects except 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. Copyright (c) Scottish Economic Society 2005.

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Article provided by Scottish Economic Society in its journal Scottish Journal of Political Economy.

Volume (Year): 52 (2005)
Issue (Month): 2 (05)
Pages: 141-176

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Handle: RePEc:bla:scotjp:v:52:y:2005:i:2:p:141-176
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  1. 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.
  2. Kalwij, Adriaan & Gregory, Mary, 2000. "Overtime Hours in Great Britain over the Period 1975-1999: A Panel Data Analysis," IZA Discussion Papers 153, Institute for the Study of Labor (IZA).
  3. Schmidt-Sorensen, Jan Beyer, 1991. "An Efficiency-Wage-Hours Model and Shorter Working Hours," Scottish Journal of Political Economy, Scottish Economic Society, vol. 38(2), pages 113-31, May.
  4. Jacobson, Tor & Ohlsson, Henry, 1996. "Working Time, Employment, and Work Sharing: Evidence from Sweden," SSE/EFI Working Paper Series in Economics and Finance 135, Stockholm School of Economics.
  5. Crépon, Bruno & Kramarz, Francis, 2002. "Employed 40 Hours or Not-Employed 39: Lessons from the 1982 Mandatory Reduction of the Workweek," IZA Discussion Papers 416, Institute for the Study of Labor (IZA).
  6. Kapteyn, Arie & Kalwij, Adriaan & Zaidi, Asghar, 2000. "The Myth of Worksharing," IZA Discussion Papers 188, Institute for the Study of Labor (IZA).
  7. Hubler, Olaf, 1989. "Individual overtime functions with double correction for selectivity bias," Economics Letters, Elsevier, vol. 29(1), pages 87-90.
  8. Jennifer Hunt, 1996. "Has Work-Sharing Worked in Germany?," NBER Working Papers 5724, National Bureau of Economic Research, Inc.
  9. 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.
  10. Calmfors, Lars & Hoel, Michael, 1988. " Work Sharing and Overtime," Scandinavian Journal of Economics, Wiley Blackwell, vol. 90(1), pages 45-62.
  11. 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.
  12. 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.
  13. 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).
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