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How Do Hours Worked Vary with Income? Cross-Country Evidence and Implications

Alexander Bick, Nicola Fuchs-Schündeln and David Lagakos

American Economic Review, 2018, vol. 108, issue 1, 170-99

Abstract: This paper builds a new internationally comparable database of hours worked to measure how hours vary with income across and within countries. We document that average hours worked per adult are substantially higher in low-income countries than in high-income countries. The pattern of decreasing hours with aggregate income holds for both men and women, for adults of all ages and education levels, and along both the extensive and intensive margin. Within countries, hours worked per worker are also decreasing in the individual wage for most countries, though in the richest countries, hours worked are flat or increasing in the wage. One implication of our findings is that aggregate productivity and welfare differences across countries are larger than currently thought.

JEL-codes: E23 E24 J22 J31 O11 O15 (search for similar items in EconPapers)
Date: 2018
Note: DOI: 10.1257/aer.20151720
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Handle: RePEc:aea:aecrev:v:108:y:2018:i:1:p:170-99