Preference to work and its effects on economic growth and happiness

Jim Yongtao Jin and Geethanjali Selvaretnam

Working Papers from Business School - Economics, University of Glasgow

Abstract: There are circumstantial and researched evidence that people’s preferences to work differ and change. We depart from partial equilibrium models which show decisions for labour and leisure depend on their relative prices. This paper presents a simple general equilibrium framework to show that labour hours are determined by the preference to work and are independent of real wages and consumption. Moreover, the theoretical model enables us to estimate the preference to work at the macro level. A panel data analysis across countries for the years 1990 – 2018 shows with statistical significance that preference to work has been on the downward trend and has a negative relationship with GDP per capita and the ratio of wage income to GDP. Results also show that higher the preference to work, higher the GDP growth rate and lower the reported level of happiness.

Keywords: work; labour hours; preference to work; economic growth; happiness; general equilibrium (search for similar items in EconPapers)
JEL-codes: D5 I31 J22 O4 (search for similar items in EconPapers)
Date: 2020-12
New Economics Papers: this item is included in nep-hap and nep-lma
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Persistent link: https://EconPapers.repec.org/RePEc:gla:glaewp:2020_30

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