How Many Hours Would You Want to Work a Week? Job Quality and the Omitted Variables Bias in Labour Supply Models: A Longitudinal Analysis of Working Time Preference Change

29 Pages Posted: 20 Aug 2008

See all articles by Nadia Steiber

Nadia Steiber

Vienna University of Economics

Date Written: August 1, 2008

Abstract

This paper sets out to provide an understanding of how individuals form their preferences over the extent of their paid work involvement - their working time preferences - in different work environments and societal contexts. The main objective of the empirical analysis is to investigate how preferences of this kind are constructed at the individual level and adapted over time following changes in work - and family-related circumstances. The consideration of the Old and New Lander of Germany as cases for comparative analysis allows for a test of common factors in different contexts of economic conditions and gender relations. The empirical findings from a longitudinal analysis of the German Socio-Economic Panel (1993-2003) run counter to the predictions of neoclassical labour supply theory. This owes to a fundamental difference in terms of theoretical approach. While (most) economists tend to view paid work in instrumental terms - as something that people perform only for its monetary rewards, this study takes account of intrinsic work rewards as central determinants of work motivation. We find the qualitative experience of work to exert an independent influence on individuals' preferences over work hours, and therefore argue for the inclusion of work quality as a central factor in labour supply decisions.

Keywords: Labour, labour supply, working hours, preferences, panel data analysis

JEL Classification: J01, J22, J17, C23, D01

Suggested Citation

Steiber, Nadia, How Many Hours Would You Want to Work a Week? Job Quality and the Omitted Variables Bias in Labour Supply Models: A Longitudinal Analysis of Working Time Preference Change (August 1, 2008). SOEPpaper No. 121. Available at SSRN: https://ssrn.com/abstract=1240313 or http://dx.doi.org/10.2139/ssrn.1240313

Nadia Steiber (Contact Author)

Vienna University of Economics ( email )

Welthandelsplatz 1
Vienna, Wien 1020
Austria

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