NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The Incentive for Working Hard: Explaining Hours Worked Differences in the U.S. and Germany

Linda A. Bell, Richard B. Freeman

NBER Working Paper No. 8051
Issued in December 2000
NBER Program(s):   LS

This paper seeks to explain the greater hours worked by Americans compared to Germans in terms of forward-looking labor supply responses to differences in earnings inequality between the countries. We argue that workers choose current hours of work to gain promotions and advance in the distribution of earnings. Since US earnings are more unequally distributed than German earnings, the same extra work pays off more in the US, generating more hours worked. Supporting this inequality-hours hypothesis, we show that in both countries hours worked is positively related to earnings inequality in cross section occupational contrasts and that hours worked raises future wages and promotion prospects in longitudinal data.

download in pdf format
   (177 K)

email paper

A non-technical summary of this paper is available in the April 2001 NBER digest.  You can sign up to receive the NBER Digest by email.

This paper is available as PDF (177 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Published: Labour Economics, Vol. 8, no. 2 (May 2001): 181-202

Users who downloaded this paper also downloaded these:
Bell and Freeman w4808 Why Do Americans and Germans Work Different Hours?
Blanchard and Wolfers w7282 The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence
Alesina, Glaeser, and Sacerdote w11278 Work and Leisure in the U.S. and Europe: Why So Different?
Kuhn and Lozano w11895 The Expanding Workweek? Understanding Trends in Long Work Hours Among U.S. Men, 1979-2004
Altonji and Paxson w2121 Labor Supply Preferences, Hours Constraints, and Hours-Wage Tradeoffs
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us