Work Intensity and Welfare Across Countries and Over Time

This paper develops a long-run theory of labor effort, defined as the product of hours worked times work intensity. Under empirically plausible parameter values, the model predicts that intensity rises with income as hours decline. The theory provides a unified interpretation of several empirical regularities: cross-country disparities in hourly productivity among workers with comparable skills and technologies; higher workplace stress in richer economies; limited effectiveness of work-organization reforms in poor regions; patterns of non-work at work. The model is calibrated to match the large joint shift in hours and work intensity in the United States during the first half of the twentieth century. It shows that cross-country differences in intensity matter for welfare as much as differences in hours and suggests that accounting for intensity would significantly narrow measured welfare differences between rich and poor countries. The analysis identifies a key mechanism underlying the reorganization of work and leisure during the transition from poor traditional economies to affluent industrial ones.