The 35-Hour Workweek in France: Straightjacket or Welfare Improvement?
Economic Policy, No. 55, pp. 417-463, July 2008
46 Pages Posted: 8 Apr 2011
Date Written: July 1, 2008
Workweek reduction laws may be beneficial if market interactions do not fully take into account the preferences reflected in declining secular trends in working hours. The most recent law in France shortened the workweek from 39 to 35 hours in 2000 for large firms, and in 2002 for small firms. Analysing differences between large and small firm employees before and after the law, we find that aggregate employment was unaffected but labour turnover increased, as firms shed workers who became more expensive. Survey responses indicate that the welfare impact of the law was different across groups of workers: women but not men may have benefited from coordination to a shorter workweek, and there is also evidence of negative welfare effects for managers, possibly due to the law’s administrative burden.
Keywords: Workweek, coordination, job-sharing, welfare, 35-hour workweek, France
JEL Classification: E24, J22, C21
Suggested Citation: Suggested Citation