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A Model of the Trends in Hours

  • Guillaume Vandenbroucke

    ()

    (Economics University of Southern California)

During the first half of the 20th century the workweek in the United States declined, and the distribution of hours across wage deciles narrowed. At the same time, the distribution of wages narrowed too. The hypothesis proposed is (i) Households have access to an increasing number of leisure activities which enhance the value of non-market time; (ii) The rise of education accounts for the narrowing of the wage and hours distributions. Such mechanisms, embedded into a neoclassical growth model, quantitatively account for the observations. The rise in wages is the main contributor to the decline in hours. The decline in the price of leisure goods is second in importance, yet its contribution is large

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Paper provided by Society for Economic Dynamics in its series 2006 Meeting Papers with number 118.

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Date of creation: 03 Dec 2006
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Handle: RePEc:red:sed006:118
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