A Gift of Time

Daiji Kawaguchi, Jungmin Lee and Daniel Hamermesh

No 18643, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: How would people spend time if confronted by permanent declines in market work? We identify preferences off exogenous cuts in legislated standard hours that raised employers' overtime costs in Japan around 1990 and Korea in the early 2000s. We estimate the probability that an individual was affected by the reform and relate it to changes in time use based on time diaries. Reduced-form estimates show that the direct effect on a newly-constrained worker was a substantial reduction in market time, with the freed-up time in Japan reallocated to leisure, but in Korea also showing some impact on household production. Simulations using GMM estimates of a Stone-Geary utility function defined over time use suggest no effect on household production in either country. Estimation of a household model shows only slight evidence that spouses shared the time gift, nor that one spouse's allocation of non-market time changed when the other spouse's market work was permanently and exogenously reduced.

JEL-codes: D13 E21 J22 J23 (search for similar items in EconPapers)
Date: 2012-12
Note: EFG LS
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

Published as Labour Economics. Volume 24, October 2013, Pages 205–216

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Journal Article: A gift of time (2013)
Working Paper: A Gift of Time (2012)
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