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American Economic Review Vol. 102 No. 3 2012

Aggregate Impacts of a Gift of Time

Jungmin Lee1; Daiji Kawaguchi2; Daniel S. Hamermesh3

1 Department of Economics, Sogang University, Seoul, 121-742, Korea, and IZA. · 2 Hitotsubashi University, Kunitachi, Tokyo, 186-8601, Japan, and IZA. · 3 University of Texas at Austin, Speedway Avenue, Austin, TX 78712, and Maastricht University, IZA, and NBER.

Abstract

How would people spend additional time if confronted by permanent declines in market work? We examine the impacts of cuts in legislated standard hours which raised employers' overtime costs in Japan around 1990 and in Korea in the early 2000s. Using time-diaries from before and after, we show the shocks were effective -- per-capita hours of market work declined discretely. The economy-wide drops in market work were reallocated solely to leisure and personal maintenance. In the absence of changing household technology a permanent time gift leads to no increase in time spent in household production by the average individual.

DOI
10.1257/aer.102.3.612
Volume
102
Issue
3
Pages
612-616
Language
en
Sources
bibtex:phds-export.bib openalex crossref

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