Does Worktime Regulation Cost Jobs?
Speaker(s)Felix Koenig (Carnegie Mellon University, United States)
LocationTinbergen Institute Amsterdam, room 1.61
Date and time
June 07, 2022
15:30 - 16:30
Paid time off is one of the most common and most valued amenities of employment. This study analyses the labor market effects of mandating paid time off. We leverage a German court ruling that mandated more time off for specific age groups in some industries. We find that the ruling significantly increased paid time off, with no adverse effects on employment or wages. We interpret these results through the lens of canonical labor market models and find evidence for imperfect competition in the labor market. Our results suggest a similar degree of market power of employers over low and high-paid workers. Joint paper with Simon Quach.