Journal Article

No. 2014-7 | February 06, 2014
Working-Week Flexibility: Implications for Employment and Productivity PDF Icon

Abstract

This paper evaluates the effects for the Spanish case of allowing greater flexibility regarding the weekly hours worked on the working week, employment and productivity. A baseline model economy is calibrated to reproduce the cross-sectional distribution of workweeks across plants, as well as certain features of the Spanish economy. The author compares the steady-state status quo, where a forty-hour workweek is imposed and no flexibility is allowed, and the steady-state of economies with a higher degree of flexibility in weekly hours. The 2012 reform is found to preserve employment and generate a 1.72% increase in productivity. In the work-sharing scenario, the increase in employment (1.86%) comes at the expense of a lower increase in productivity (1.31%). Finally, the full flexibility scenario preserves employment and generates a substantial increase in productivity (2.6%).

JEL Classification

E24 E60 J21

Citation

Victoria Osuna (2014). Working-Week Flexibility: Implications for Employment and Productivity. Economics: The Open-Access, Open-Assessment E-Journal, 8 (2014-7): 1—29. http://dx.doi.org/10.5018/economics-ejournal.ja.2014-7

Assessment

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Comments and Questions


Jasdeep Kaur Dhami - Recommended for reading
February 07, 2014 - 04:51