Sunday, 23 June 2013

Working Weeks: Rich & Poor

Apparently in the US in 1890, the poorest 10% of blokes worked around 58 hours/week. The wealthiest worked around 40 hours.

According to Diego Restuccia (University of Toronto) and Guillaume Vandenbroucke (University of Southern California), in 1990, the poorest amongst us were down to almost 40 hours/week. The hours worked by the wealthiest haven't changed in the intervening century, so are now the same length as the poorest.

Diego & Guillaume found that the productivity of the poorest amongst us has risen dramatically, with their increased earnings allowing them to spend less time working, and more time going to school. They "find that the increase in wages and life expectancy account for 80% of the increase in years of schooling and 88% of the reduction in hours of work. Wages alone account for the bulk of the increase in schooling (75%) and the decline in hours (97%). Life expectancy plays a significant role in the increase in schooling, accounting by itself for 25% of the increase, but its contribution to the decline in hours is small" (2013, p. 1864).

Diego & Guillaume's research, "A Century of Human Capital and Hours" can be accessed at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2261571 or from Wiley online at http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1465-7295.

Reference: Restuccia, Diego & Vandenbroucke, Guillaume (2013). A Century of Human Capital and Hours. Economic Inquiry, July 2013, Volume 51, Issue 3 (pp. 1849-1866).

Sam

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