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Effective Working Hours and Wages: The Case of Downward Adjustment via Paid Absenteeism


  • Christian Pfeifer

    () (Institute of Economics, Leuphana University of Lüneburg, Germany)


This paper compares contractual with effective working hours and wages, respectively. Effective working hours are defined as contractual working hours minus absent working hours. This approach takes into account workers' downward adjustment of working time via paid absenteeism if working time constraints are present, which induce workers to accept contracts with larger than their optimal choice of working hours. A German personnel data set, which contains precise information on wages as well as working and absence hours, is used to assess the impact of such downward adjustment on wage inequality and wage differentials (gender, schooling, age).

Suggested Citation

  • Christian Pfeifer, 2009. "Effective Working Hours and Wages: The Case of Downward Adjustment via Paid Absenteeism," Working Paper Series in Economics 152, University of Lüneburg, Institute of Economics.
  • Handle: RePEc:lue:wpaper:152

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    References listed on IDEAS

    1. Wolf, Elke, 2002. "Lower wage rates for fewer hours? A simultaneous wage-hours model for Germany," Labour Economics, Elsevier, vol. 9(5), pages 643-663, November.
    2. Andrea Ichino & Enrico Moretti, 2009. "Biological Gender Differences, Absenteeism, and the Earnings Gap," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 183-218, January.
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    5. Christian Pfeifer & Tatjana Sohr, 2009. "Analysing the Gender Wage Gap (GWG) Using Personnel Records," LABOUR, CEIS, vol. 23(2), pages 257-282, June.
    6. Anger, Silke, 2005. "Unpaid Overtime in Germany: Differences between East and West," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 17-27.
    7. Anger, Silke, 2008. "Overtime Work as a Signaling Device," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 167-189.
    8. Brown, Sarah & Sessions, John G, 1996. " The Economics of Absence: Theory and Evidence," Journal of Economic Surveys, Wiley Blackwell, vol. 10(1), pages 23-53, March.
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    11. Anger, Silke, 2011. "The Cyclicality of Effective Wages within Employer–Employee Matches in a Rigid Labor Market," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 786-797.
    12. Rigmar Osterkamp & Oliver Röhn, 2007. "Being on Sick Leave: Possible Explanations for Differences of Sick-leave Days Across Countries," CESifo Economic Studies, CESifo, vol. 53(1), pages 97-114, March.
    13. Bradley, Steve & Green, Colin & Leeves, Gareth, 2007. "Worker absence and shirking: Evidence from matched teacher-school data," Labour Economics, Elsevier, vol. 14(3), pages 319-334, June.
    14. Barmby, Tim & Sessions, John G & Treble, John G, 1994. " Absenteeism, Efficiency Wages and Shirking," Scandinavian Journal of Economics, Wiley Blackwell, vol. 96(4), pages 561-566.
    15. Pfeifer, Christian, 2008. "An empirical note on wages in an internal labour market," Economics Letters, Elsevier, vol. 99(3), pages 570-573, June.
    16. Allen, Steven G, 1981. "An Empirical Model of Work Attendance," The Review of Economics and Statistics, MIT Press, vol. 63(1), pages 77-87, February.
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    More about this item


    absenteeism; earnings; inequality; wage differentials; working hours;

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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