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Is Variation in Hours of Work Driven by Supply or Demand? Evidence from Finnish Manufacturing Industries

Author

Listed:
  • Petri Böckerman

    (Labour Institute for Economic Research)

  • Markus Jäntti

    (Åbo Akademi)

Abstract

This paper uses panel data from 1989 to 1995 on blue-collar workers in Finnish manufacturing industries and their establishments to assess the extent to which hours of work are affected by individual or establishment characteristics - observed as well as unobserved. We argue that recent research on working hours has focused almost exclusively on the supply of labor, but that insights into the extent to which hours variation is driven not by supply but by demand will affect the likelihood that supply-side policies will succeed. Our estimates suggest that both individual and establishment characteristics matter, but that establishment level effects account for the bulk of the variation in hours.

Suggested Citation

  • Petri Böckerman & Markus Jäntti, 2005. "Is Variation in Hours of Work Driven by Supply or Demand? Evidence from Finnish Manufacturing Industries," Labor and Demography 0505012, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpla:0505012
    Note: Type of Document - pdf; pages: 26
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/lab/papers/0505/0505012.pdf
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    References listed on IDEAS

    as
    1. Chang, Yongsung & Kwark, Noh-Sun, 2001. "Decomposition of hours based on extensive and intensive margins of labor," Economics Letters, Elsevier, vol. 72(3), pages 361-367, September.
    2. Marco Bianchi & Bjorn R. Gudmundsson & Gylfi Zoega, 2001. "Iceland's Natural Experiment in Supply-Side Economics," American Economic Review, American Economic Association, vol. 91(5), pages 1564-1579, December.
    3. Petri Böckerman, 2002. "Overtime in Finland," Finnish Economic Papers, Finnish Economic Association, vol. 15(1), pages 36-54, Spring.
    4. Agell, S.A. & Meghir, C., 1995. "Male Labour Supply in Sweden : Are Incentives Important?," Papers 12, Uppsala - Working Paper Series.
    5. Jaakko Kiander & Jaakko Pehkonen, 1999. "Finnish unemployment: observations and conjectures," Finnish Economic Papers, Finnish Economic Association, vol. 12(2), pages 94-108, Autumn.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Bargain, Olivier & Orsini, Kristian, 2006. "In-work policies in Europe: Killing two birds with one stone?," Labour Economics, Elsevier, vol. 13(6), pages 667-697, December.

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    More about this item

    Keywords

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    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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