Loosening Hours Constraints on the Supply of Labor. What if Germans Had a Dutch Labor Market?

Total employment in Germany is supposed to increase if people are able to realize their desired working hours. However, this back-of-the-envelope calculation overestimates the effect of loosening hours constraints, because even in a very flexible labor market there will exist hours restrictions for certain jobs and occupations. Therefore, I simulate Germans' working hours in a more flexible but real world, namely the Dutch labor market. The results indicate that the average weekly working hours of German employees would indeed decrease if they were employed on conditions similar to those of the Dutch Labor market. Thus, there exists some potential for additional work-sharing in Germany. Furthermore, the match between actual and desired hours of Germans would improve if Germans had the same hours flexibility as Dutch employees. This holds both for men and for women. Another piece of good news is that hours restrictions shrank over time, which means Germany seems to be moving towards a more flexible labor market.

Wolf, Elke (2001), Loosening Hours Constraints on the Supply of Labor. What if Germans Had a Dutch Labor Market?, Schmollers Jahrbuch - Journal of Applied Social Science Studies 121(4) , 501-538