Comments on:

Labor market effects of worksharing arrangements in Europe

Jan van Ours

Tilburg University

Long history

May 1, 1886 – ChicagoEight hour song

We want to feel the sunshine (…) 8 hrs for work, 8 hours for rest, 8 hours for

what we willChapman (EJ 1909) – Hours of labor

Why work 10 hours per day if 9 is optimal?

Annual changes in hours actually worked per employee

1950-1975 1975-2004

France -10.5 -16.0

W-Germany -25.2 -

Netherlands -21.0 -12.2

Sweden -17.0 -0.9

Italy -7.4 -7.4

U.K. -11.0 -9.0

Decomposition – 2002 Hours/

week

France 36.2

Germany 36.5

Netherlands 31.8

Sweden 38.1

Italy 37.4

U.K. 38.2

Decomposition – 2002 Hours/

week

Weeks/

year

France 36.2 40.5

Germany 36.5 40.6

Netherlands 31.8 38.4

Sweden 38.1 35.4

Italy 37.4 41.0

U.K. 38.2 40.5

Decomposition – 2002 Hours/

week

Weeks/

year

Hours/

year

France 36.2 40.5 1467

Germany 36.5 40.6 1480

Netherlands 31.8 38.4 1223

Sweden 38.1 35.4 1349

Italy 37.4 41.0 1533

U.K. 38.2 40.5 1546

Decomposition – 2002 Hours/

week

Weeks/

year

Hours/

year

Employment rate

France 36.2 40.5 1467 62.2

Germany 36.5 40.6 1480 65.3

Netherlands 31.8 38.4 1223 74.5

Sweden 38.1 35.4 1349 74.9

Italy 37.4 41.0 1533 55.6

U.K. 38.2 40.5 1546 72.7

Decomposition – 2002 Hours/

week

Weeks/

year

Hours/

year

Employment rate

Hours/

person

France 36.2 40.5 1467 62.2 912

Germany 36.5 40.6 1480 65.3 966

Netherlands 31.8 38.4 1223 74.5 911

Sweden 38.1 35.4 1349 74.9 1010

Italy 37.4 41.0 1533 55.6 852

U.K. 38.2 40.5 1546 72.7 1124

Work-sharing arrangementsStandard hours per week

France, GermanyWeeks per year:

SwedenPart-time work , employment

NetherlandsExtensive margin:

Italy

Common elements Downward trend in average working week

More flexibility Germany – increase working time Netherlands – part-time work

Worksharing – no positive employment effects

Employment rates of men slowly falling Employment rates of women strong increase

Main differences Forced – voluntary

France the rest France: strong government influence – massive

subsidies

Main differences Forced – voluntary

France the rest France: strong government influence

Opposition against part-time work Netherlands the rest NL: at first opposition of unions

Main differences Forced – voluntary

France the rest France: strong government influence

Opposition against part-time work Netherlands the rest NL: at first opposition of unions

Availability of childcare facilities Netherlands the rest NL: still few formal childcare facilities

Dichotomy

France and Germany Position of male full-time workers Events similar

Sweden and the Netherlands Combining work and family life Different routes

Comments

Nice and interesting paper/chapteroverview of many studies & empirical observations

French biasalmost 60% of the authorstheoretical model France (& Germany)French lazy & crazy: decreasing productivity, rising wages, government intervention

Main comments - theory Interesting reduction of standard working hours

Upper limit working hours “over the hill” Small decreases: employment Big decreases: employment

Main comments - theory Interesting reduction of standard working hours

Upper limit working hours “over the hill” Small decreases: employment Big decreases: employment

Explanation Non-competitive world: Monopsony/bargaining State regulation may be required

Main comments - theory Interesting reduction of standard working hours

Upper limit working hours “over the hill” Small decreases: employment Big decreases: employment

Explanation Non-competitive world: Monopsony/bargaining State regulation may be required

Other forms of working time reduction: part-time work & leave policies Theory less clear

Main comments - theory Interesting reduction of standard working hours

Upper limit working hours “over the hill” Small decreases: employment Big decreases: employment

Explanation Non-competitive world: Monopsony/bargaining State regulation may be required

Other forms of working time reduction: part-time work & leave policies Theory less clear

Interaction between extension margin of labor supply (participate or not) and the intensive margin of labor supply

Main comments - II

Growth of part-time work in NL – “Butterfly effect”?

“In no country work-sharing per se has created employment” Not sure: part-time work encouraged

increase of labor supply Competitive world: employment is

determined by labor market participation

Main comments - III Sweden – no working hours reduction but

leave facilities Almost 1 week in 5 is lost due to “absence for

other reasons than holidays” For competitive reasons? More flexibility?

Conclusion: “work sharing through career interruptions is not an attractive policy option”

Question: “why is it maintained?”

Conclusions – worksharing

Normative point of view nothing against; preferences

Economic efficiency does not reduce unemployment difficult to persuade non-economists

Actual hours follow standard hours norms follow actual changes

Are Europeans lazyor Americans crazy?

Suggests that one of the two is true

Are Europeans lazyor Americans crazy?

Suggests that one of the two is true

Maybe both are true

Are Europeans lazyor Americans crazy?

Suggests that one of the two is true

Maybe both are true

“Are some Europeans more crazy than others?”