The Demand for Hours of Labor: Direct Evidence from California

37 Pages Posted: 13 Jan 1999

See all articles by Daniel S. Hamermesh

Daniel S. Hamermesh

University of Texas at Austin - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Stephen J. Trejo

University of Texas at Austin - Department of Economics; IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: May 1998

Abstract

For many years, California required that most women receive an overtime premium of time and a half for hours of work beyond 8 in a given day. In 1980, this daily overtime penalty was extended to men as well. This situation provides a unique opportunity to estimate the impact of an exogenous increase in the relative price of overtime work. Analyzing Current Population Survey data from 1973, 1985, and 1991 that provide information on daily hours of work, we find that the overtime penalty substantially reduced the amount of overtime worked by California men compared to men in other states. Moreover, this finding persists when we use analogous comparisons for women to control for idiosyncratic shocks that may have affected the California labor market. Our estimates imply that the price elasticity of demand for overtime hours is at least -0.5.

JEL Classification: J23, J33, J22

Suggested Citation

Hamermesh, Daniel S. and Trejo, Stephen J., The Demand for Hours of Labor: Direct Evidence from California (May 1998). Available at SSRN: https://ssrn.com/abstract=120668 or http://dx.doi.org/10.2139/ssrn.120668

Daniel S. Hamermesh

University of Texas at Austin - Department of Economics ( email )

Austin, TX 78712
United States
512-475-8526 (Phone)
512-471-3510 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Stephen J. Trejo (Contact Author)

University of Texas at Austin - Department of Economics ( email )

Austin, TX 78712
United States
512-475-8512 (Phone)
512-471-3510 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
172
Abstract Views
1,645
rank
160,518
PlumX Metrics