This page offers the latest information about workshop series by WINPEC (Waseda Institute of Political Economy).

Empirical Microeconomics

Ruo Shangguan (Waseda University)

Dec. 03 2020
Title Enhancing Team Productivity through Shorter Working Hours: Evidence from the Great Recession (joint with Jed DeVaro and Hideo Owan)
Date December 03, 2020 (Thursday) 16:30-18:00
Location via Zoom
Abstract When demand for products and services drops during recessions, employers decrease labor inputs by cutting either or both of workers and hours. If pre-recession hours were excessive, cutting hours might increase labor productivity, given an inverted-U-shaped hours-productivity profile; less exhaustion implies higher effort-per-hour. This effect is amplified in team settings, where labor reallocation leads to hours being concentrated among the top performers after total hours are cut. The adjustment process is examined using single-firm data on Japanese construction design projects. Specifically, a Ricardian model is proposed, and its parameters calibrated with data to quantify the model’s predictions. Regression results derived from the actual data are consistent with the model’s predictions, specifically: (1) total productivity improves by more than the increase in individual productivity, labor share becomes more concentrated, and team size decreases during recession; (2) the productivity improvement is greater for larger teams and less productive teams and (3) larger teams exhibit lower average productivity because weaker workers join teams when more hours are needed than the stars can handle.
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