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An Efficiency-Wage-Hours Model and Shorter Working Hours

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  • Schmidt-Sorensen, Jan Beyer

Abstract

An efficiency-wage-hours model is constructed in which the production technology allows for efficiency effects of wages and working hours. Under or overemployment in hours as seen from the point of view of firms is considered. The effects of shorter standard working hours on the wage rate, actual working hours and employment among other things are analysed in an economy with efficiency-wage setting. It is shown that the possibility of overtime work and the elasticity of work effort with respect to working hours is crucial to the results. Finally, it is shown that the traditional trade-off between wages and employment doesn't occur in all situations. Copyright 1991 by Scottish Economic Society.

Suggested Citation

  • Schmidt-Sorensen, Jan Beyer, 1991. "An Efficiency-Wage-Hours Model and Shorter Working Hours," Scottish Journal of Political Economy, Scottish Economic Society, vol. 38(2), pages 113-131, May.
    • Handle: RePEc:bla:scotjp:v:38:y:1991:i:2:p:113-31
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    Cited by:

    1. M. J. Andrews & T. Schank & R. Simmons, 2005. "Does Worksharing Work? Some Empirical Evidence From The Iab‐Establishment Panel," Scottish Journal of Political Economy, Scottish Economic Society, vol. 52(2), pages 141-176, May.
    2. Jim Malley & Hassan Molana, 2002. "Efficiency Wages, Unemployment and Macroeconomic Policy," Working Papers 2002_3, Business School - Economics, University of Glasgow.
    3. Rocheteau, Guillaume, 2002. "Working time regulation in a search economy with worker moral hazard," Journal of Public Economics, Elsevier, vol. 84(3), pages 387-425, June.
    4. Giacomo Corneo, 1994. "La réduction du temps de travail dans les modèles de chômage d'équilibre : une revue de la littérature," Économie et Prévision, Programme National Persée, vol. 115(4), pages 63-73.
    5. 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.

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