ABSTRACT
To serve as an effective macroeconomic policy tool, work time regulation must have some potential to redistribute work in a manner that ameliorates under-employment and its related labor market inequities. When conceptualized as a macroeconomic policy tool along the lines of an incomes policy, the objective of hours regulation should be a long-run reduction in the average workweek. If the societal goal is to harness technological development to increase socioeconomic participation in a socially and ecologically sustainable manner, work time regulation will need to achieve a secular drift toward shorter hours. Although most economists are not opposed to shorter hours in principle, many question the ability of the policy to have employment effects on the scale needed to address the underutilization of labor prevalent in advanced economies today and the growing joblessness anticipated in the future. This chapter therefore investigates the potential for work time redistribu-
tion and reduction to achieve positive employment effects when implemented on the appropriate scale and in an effective manner. It bears repeating, however, that improving unemployment does not necessarily entail a creation of net new hours of work. The chapter begins by examining the lump-oflabor fallacy that is often marshaled against proposals to reduce work hours. It then features some of the difficulties related to the various methodologies of measuring the employment effect of shorter hours. The bulk of the chapter is devoted to an investigation of the success of various types of work time reduction experiments. Since the potential for job creation is tightly linked to the productivity effects of an hours reduction, the chapter concludes by
investigating the productivity impact of past work time experiments. The objective of the chapter is to show that positive employment effects are possible, and to elucidate the conditions under which work time regulation will have the greatest employment impact.
