Working Time, Employment, and Work Sharing: Evidence from Sweden
We study three necessary conditions for work sharing to increase employment. First, there must exist a negative long-run relation between working time and employment. Second, hours per worker must be exogenous with respect to wages and employment. Third, policy makers must be able to influence actual hours per worker. We formulate a theoretical model for employment, hours peer worker, production, and real wages. A VAR system with cointegrating constraints is estimated by maximum likelihood using Swedish private sector data 1970-1- 1990:4 We find (I) no long-run relation between hours per worker and employment, (II) that hours per worker are endogenous with respect to the estimation of long-run parameters, and (III) that legislated working time and hours per worker are related to each other in the long run.
|Date of creation:||Nov 1996|
|Date of revision:|
|Publication status:||Published in Empirical Economics, 2000, pages 169-187.|
|Contact details of provider:|| Postal: The Economic Research Institute, Stockholm School of Economics, P.O. Box 6501, 113 83 Stockholm, Sweden|
Phone: +46-(0)8-736 90 00
Fax: +46-(0)8-31 01 57
Web page: http://www.hhs.se/
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- Jennifer Hunt, 1996. "The Response of Wages and Actual Hours Worked to the Reductions of Standard Hours," NBER Working Papers 5716, National Bureau of Economic Research, Inc.
- Calmfors, Lars, 1985. "Work sharing, employment and wages," European Economic Review, Elsevier, vol. 27(3), pages 293-309.
- Johansen, Søren & Juselius, Katarina, 1992. "Testing structural hypotheses in a multivariate cointegration analysis of the PPP and the UIP for UK," Journal of Econometrics, Elsevier, vol. 53(1-3), pages 211-244.
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92-04, University of Copenhagen. Department of Economics.
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