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The Cost of Overtime Hours in British Production Industries

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  • Robert A Hart
  • Robin J Ruffell

Abstract

Both theoretical and empirical labor market papers that incorporate the workers-hours dichotomy often contain assumptions about shapes of the overtime premium schedules faced by industry. Using cross-section data for British production industries in three years of sharply contrasting economic climates (1981, 1984, and 1988), this paper investigates empirically the appropriate choice of schedule and, therefore, the industrial cost consequences of changing the average number of overtime hours per period. The analysis tackles problems associated with data disaggregation, the proportion of workers working overtime, omitted variables, heteroscedasticity, and intertemporal variation. Copyright 1993 by The London School of Economics and Political Science.
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  • Robert A Hart & Robin J Ruffell, 1992. "The Cost of Overtime Hours in British Production Industries," Working Papers Series 92/1, University of Stirling, Division of Economics.
  • Handle: RePEc:stl:stlewp:92/1
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    Cited by:

    1. Hart Robert A. & Ma Yue, 2008. "Wages, Hours and Human Capital Over the Life Cycle," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 228(5-6), pages 446-464, October.
    2. Ana Rute Cardoso & Daniel S. Hamermesh & José Varejao, 2012. "The Timing of Labor Demand," Annals of Economics and Statistics, GENES, issue 105-106, pages 15-34.
    3. Bell, D. & RA Hart, 1999. "Overtime Working in an Unregulated Labour Market," Working Papers Series 9904, University of Stirling, Division of Economics.
    4. Nakamura, Masao & Hubler, Olaf, 1998. "The bonus share of flexible pay in Germany, Japan and the US: Some empirical regularities," Japan and the World Economy, Elsevier, vol. 10(2), pages 221-232, April.
    5. Bell, David N.F. & Hart, Robert A., 2003. "How Important Is Guaranteed or Institutionalised Overtime?," IZA Discussion Papers 766, Institute for the Study of Labor (IZA).
    6. Robert A. Hart, 2006. "Worker-Job Matches, Job Mobility and Real Wage Cyclicality," Economica, London School of Economics and Political Science, vol. 73(290), pages 287-298, May.
    7. Hart, Robert A. & Malley, James R., 2000. "Marginal cost and price over the business cycle: comparative evidence from Japan and the United States," European Journal of Political Economy, Elsevier, vol. 16(3), pages 547-569, September.
    8. Giannelli, Gianna Claudia & Braschi, Cristina, 2002. "Reducing Hours of Work: Does Overtime Act as a Brake Upon Employment Growth? An Analysis by Gender for the Case of Italy," IZA Discussion Papers 557, Institute for the Study of Labor (IZA).
    9. Hart, Robert A. & Malley, James R. & Ruffell, Robin J., 1996. "What shapes are overtime premium schedules? Some evidence from Japan, the UK, and the US," Economics Letters, Elsevier, vol. 53(1), pages 97-102, October.
    10. Bauer, Thomas & Zimmermann, Klaus F, 1999. "Overtime Work and Overtime Compensation in Germany," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(4), pages 419-436, September.
    11. Robert Sandy & Robert F. Elliott, 2005. "Long-term Illness and Wages: The Impact of the Risk of Occupationally Related Long-term Illness on Earnings," Journal of Human Resources, University of Wisconsin Press, vol. 40(3).
    12. Simmons, R. & Schank, Thorsten & Andrews, Martyn J., 2004. "Does Worksharing Work? Some Empirical Evidence from the IAB Panel," Discussion Papers 25, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    13. King, Stephen P., 1997. "Oligopoly and overtime," Labour Economics, Elsevier, vol. 4(2), pages 149-165, June.

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