Aggregate Impacts of a Gift of Time

35 Pages Posted: 24 Dec 2011

See all articles by Jungmin Lee

Jungmin Lee

FIU; IZA Institute of Labor Economics

Daiji Kawaguchi

University of Tokyo - Graduate School of Economics

Daniel S. Hamermesh

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

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 that raised employers' overtime costs in Japan around 1990 and Korea in the early 2000s. Using time-diaries from before and after these shocks, we show that these 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.

Keywords: time use, household production, demand shock, macroeconomic effects

JEL Classification: J22, J11, E24

Suggested Citation

Lee, Jungmin and Kawaguchi, Daiji and Hamermesh, Daniel S., Aggregate Impacts of a Gift of Time. IZA Discussion Paper No. 6199, Available at SSRN: https://ssrn.com/abstract=1976530

Jungmin Lee (Contact Author)

FIU ( email )

University Park
11200 SW 8th Street
Miami, FL 33199
United States

IZA Institute of Labor Economics

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

Daiji Kawaguchi

University of Tokyo - Graduate School of Economics ( email )

Tokyo
Japan

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

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