Unemployment, Structural Change and Globalization

M. Pianta and M. Vivarelli

UNEMPLOYMENT AND WORKING TIME
by M. Vivarelli

1. Introduction

Although most of economic studies are mainly focused about employment and unemployment trends, working time is an essential indicator of welfare. While the total amount of working time is a direct measure of the "need of work" associated with economic growth - and so it is the only correct measure of the employment potential of a given economy - per-capita working time is a measure of "quality of life" and a correct (inverted) measure of potential demand for new ICT goods and services, the use of which is time intensive.

Indeed, from early on, the process of industrialisation has been accompanied by a continuous reduction in working time. Such reduction has taken the form of shorter working days, shorter working weeks, shorter working lives, longer vacations, paid leave and so on. According to some recent estimates for the OECD countries (Maddison, 1979; 1991), in the period 1870-1970 the number of hours worked per-capita in one year has fallen by over 37%. From a historical perspective, the reduction in working time has been one of the means through which industrialised economies have redistributed the gains from technical progress to the whole of society (the other being increasing incomes). On the one hand, in fact, the length of working time defines the division of productivity gains between profits and wages; on the other, the reduction in working time has meant employment of those workers who otherwise would have been displaced by the continuous growth of productivity (see also "Unemployment and Technical Change").

Over the last two decades, this mechanism of redistribution has to cope with the radical transformations in the economic structure of all the main industrialised (and newly industrialised) countries. The so-called Fordist paradigm, which has dominated the development of Western countries from the end of the Second World War to the early Seventies, has progressively given way to a new techno-economic paradigm centred on Information and Communication Technologies (Freeman and Soete, 1994; Boyer, 1988a). The main feature of ICTs is their capacity to store, process and disseminate information in a short time and at a minimum cost (Soete, 1987). The information-intensive nature of the new paradigm has generated at least four major changes in the economic system: i) it has increased flexibility in production; ii) it has widened the supply of non-material commodities, such as services, compared to manufactured goods; iii) it has increased the tradeability of commodities and favoured the delocation of production; iv) it has raised the importance of technical know-how as a productive factor (Boyer, 1989).

These changes have deeply modified the correlation between productivity, growth and employment which characterised the previous techno-economic paradigm. In the Fordist system, productivity and costs depended on the scale of production through the law of increasing returns, so that firms’ profitability was dependent on a continuous expansion of consumption, employment and wages (mass consumption). By contrast, the higher degree of flexibility delivered by ICTs makes production profitable at any level of activity and has weakened the aggregate link between growth and employment (Boyer, 1988b). As a consequence of the diffusion of ICTs, productivity in the manufacturing sector has risen at a higher rate than output, determining a dramatic fall in manufacturing employment (Vivarelli, 1995; Padalino - Vivarelli, 1997; Vivarelli, Evangelista and Pianta, 1995; Pianta, 1995; Pianta, Evangelista and Perani, 1996).

Such reduction in manufacturing employment has been partially compensated by the expansion of the service sector driven by the ITCs. On the one hand, reorganisation of production has widened the range of business services required by firms (Ray, 1986). On the other, ICTs have increased the variety of personal and collective services offered to consumers. Although in some circumstances this tendency has not been sufficient to compensate for the labour displacement in manufacturing, the growth potential of the service sector appears not to have yet been fully exploited and further expansion in this area is needed in order to raise total employment levels (Howe, 1986; Jensen and Kjeldsen-Kragh, 1994; Appelbaum and Schettkat, 1995).

Directly connected to the adoption of ICTs is the increased importance of knowledge as a production factor. While in Fordism technical know-how was essentially embodied in specialised equipment and workers were required to perform standardised tasks along the assembly line, in the new technological paradigm workers’ ability to manipulate information and to intervene directly in the production process becomes a key factor (Boyer and Caroli, 1993). Taking into account that the accumulation of knowledge is a time intensity activity, this change calls for a reduction of working time and for an extension of time devoted to education and vocational training .

Yet, in comparison with the radical transformation of the production system, social and institutional change appears to have lagged behind. In particular, the mismatch between the requirements of the new techno-economic paradigm and the system of work organisation inherited from the Fordism era appears to be a major cause of the dramatic problem of unemployment, social exclusion and increasing polarisation now faced by many countries (Freeman and Soete, 1994). For the ICTs to express all their potential in terms of growth and employment, therefore it is necessary to introduce a system of work organisation consistent with the technological imperatives of the new paradigm (Perez, 1981; Freeman et al., 1982).

As far as working time is concerned, the transformations outlined above exert a pressure for a change in two important dimensions: i) the organisation of work, ii) the length of working time .

First, higher flexibility in production requires a corresponding increase in the flexibility of labour and working hours (Taddei, 1991). New production methods such as the "just-in-time" and "lean production" system, in fact, imply a more direct dependency of production on the economic cycle, so that periods of overproduction and overtime are followed by periods of relative inactivity. The present system of work organisation, based on permanent contracts and on a traditional working time, hampers the flexibility needed by firms and is translated in additional costs which, in turn, causes a slow down in both output and employment growth. In this context, unions and employers associations should experiment new forms of negotiation leading to a comprehensive re-organization of working time. For instance, a further diffusion of "voluntary part-time" could be very useful for reconciling new firms' needs with individual preferences (Hewitt, 1993; Gershuny, 1994). In more details, it is necessary to couple the implementation of a reduced per-capita working time at the firm's level with the extension of part-time, the annualization of per-capita working time, the adoption of flexible schedules and so on. However, it is also important to underline the need of a large consensus on the adoption of these new forms of work organisation and the importance of social negotiation, in order to avoid either "involuntary part-time" or other forms of workers' exploitation (ILO, 1989). This is one of the reason why union and employers representatives will play an important role in the implementation of the reduction and re-organisation of working time.

In addition, there seems to be a need for a reduction in the working time of individuals for three substantial reasons. First, the importance of knowledge and the fast pace of change in know-how imply a continuous learning process (CEC Delors Report, 1993; Lundvall and Johnson, 1994). Periods of inactivity should therefore be exploited as time for acquiring new skills and updating general and technical knowledge. A second argument in favour of the reduction in working time is that the new services are time-intensive both in learning and in consumption (Rothwell et al., 1974; Petit and Soete, 1997). To favour the expansion of such services, - a crucial factor in promoting employment growth - it is necessary to increase the time available to individuals to learn about the new services and to consume them (think for instance to the CD-ROM market which is slowly developing because of demand constraints due to the amount of time necessary for learning and utilisation). Third, a reduction in working time may reduce the fall in labour demand due to the increase in productivity caused by ICTs and is a way to redistribute the benefits of technical progress to all participants in the labour market (Holland, 1993; Aznar, 1993).

All in all, the fixed length and organisation of working time inherited from the era of mass industrial production appears a major bottleneck in the present challenge. It is in this context that reduced working hours and more flexible arrangements are needed for capturing and redistributing the gains offered by the new technologies. More time freed from work is needed for the continuing learning and retraining processes which are crucial to an innovative adaptable economy. More time freed from work is also needed to make possible the development of new ICT-based consumption activities, which in Europe are lagging behind US levels. Finally, more flexible arrangements are needed to fully exploit the potential of ICTs and enhance the freedom of choice of individuals over the incidence of their working time and in relation to their education, working careers and personal lives.

2. The economic theory

For the reasons discussed in the previous section, a reduction in working time can be considered an institutional change which is good "in sè". In fact, a reduction in working time can involve more free-time, a better quality of life, a more flexible organisation of production and an increasing demand for the new time-intensive ICT services (Hewitt, 1993; Gershuny, 1994). On the other hand, most of the current debate, especially within the economic discipline, focuses on the possible employment consequences of a reduction in average working time. At the same time, the reduction of working time is often included in the policy agenda exactly as measure of combating high rates of unemployment (this is the case of French and Italian governments which are currently proposing national laws addressed to the reduction of the average weekly hours of work). This section aims to summarise the economic debate about the possible employment consequences of a reduction of working time.

The standard economic theory is generally quite sceptical about the effectiveness of shorter working time in increasing employment. Although shorter working time should distribute a given level of labour requirement over an increased number of workers, such measure tends to generate several counter-effects that may lead to an overall reduction in the demand for labour. The main counter-effects identified in the economic literature are as follows.

First, a reduction in working time would induce workers and trade unions to demand a higher hourly wage in order to preserve the total income of workers (Booth and Schiantarelli, 1987). For a given level of labour productivity, an increase in the hourly wage would determine a reduction in the demand for labour.

Second, wages are not the only component of labour costs, which also include fixed costs. Therefore, even at a constant hourly wage, a reduction in working time and a corresponding increase in the number of employed would imply an increase in fixed labour costs (Hart, 1987).

Third, firms can respond to the rise in labour costs induced by shorter per-capita working time by increasing overtime, without hiring additional workers (Calmfors and Hoel, 1988).

Fourth, firms can organise production on an higher number of shifts in order to maintain an efficient use of capital. More shifts implies more efforts by workers, who will demand a higher wage which, in turn, would reduce the demand for labour (Calmfors and Hoel, 1989).

Fifth, the skill profile of the new workers hired as a result of shorter working time may be inadequate for the firms’ requirements and this would involve higher training cost (Hoel and Vale, 1986).

Sixth, a shorter working time may cause a fall in productivity either because the incidence of non-productive times (such as breaks) increases or because of the costs involved in reorganising production with a larger number of workers (Andersen, 1987).

Finally, these negative effects are amplified by the loss of international competitiveness determined by the increase in costs and/or reduction in productivity.

In short, standard economic literature claims that a reduction in working time does not ensure per sé an increase in employment. Yet, the conclusions listed above often depend on the specific hypotheses assumed by standard economic theory and one has to evaluate the degree to which such conclusions depend on restrictive assumptions (for a survey on this issue, see Corneo, 1994).

Notwithstanding the critiques which can be opposed to standard economic models, it appears clear that, in order to be effective, any policy addressed to the reduction of the working time needs to be supported by a set of complementary measures designed to minimise the counter-effects listed above. At a preliminary stage of investigation, one can identify the following complementary measures.

First, wage compensation for the reduction in the income of workers due to shorter working time must not exceed productivity growth. The support by trade unions and the agreement of workers is therefore necessary in order to ensure a wage dynamics consistent with a reduction in working time.

Second, to prevent the increase in labour costs due to a higher incidence of fixed costs, policy should aim at reducing all fixed costs arising from fiscal and social insurance obligations.

Third, overtime may be discouraged by defining a scheme for which the premium increases progressively with the length of overtime worked by each employee (Santamaki-Vouri, 1986; Toedter, 1988).

Fourth, an increase in the number of shifts does not necessarily imply an increase in wages if workers are willing to accept a more flexible work schedule in return for shorter working time (Calmfors and Hoel, 1989). Also in this case, the negotiation of these policies between firms and trade unions should become a central issue.

Fifth, the reduction in working time should be seen as a complementary measure to training policies, in order to ensure that the skills of the unemployed can match requirements for the vacancies opened by a reduction in working time.

Finally, to avoid any loss of international competitiveness, working time reduction in individual countries should be the result of negotiations with the other trading countries.

As is clear from the above discussion, the economic aspects of the argument are complex and the policy implementation of a reorganisation and reduction of working time appears a challenging theme for the policy agenda (see Bosch, 1986 and Seifert, 1991 on the interesting policy debate in the former Federal Republic of Germany). In addition, a reduction and reorganisation of working time would also imply major non-economic changes and new opportunities.

Such transformation requires a wide range of policies targeted at different levels (Cette and Taddei, 1997). At the firm level, production activity and the system of shifts would be restructured in order to ensure consistency between firms’ profitability and reduced working time. In addition, the reorganisation of working time would require a change in the modality of bargaining between trade unions and management, in order to include working time more explicitly as a factor of negotiation. Correspondingly, length of working time may not be defined on a weekly basis but over a longer period, such as a year: within a certain number of hours to be worked in a year, workers and firms might negotiate a flexible working schedule which is consistent with both firms’ economic imperatives and workers’ needs (Corneo, 1994; Gorz, 1989 and 1993).

The reorganisation of working time also requires appropriate policy measures targeted at the local socio-economic system. On the one hand, a different time structure of all social, institutional and economic activities is required in order to support a different organisation of working time. This includes the opening-times of shops, banks, public offices as well as school days, social and personal services and so on. On the other, local communities must be able to exploit the opportunities opened by a shorter working time: these include a new demand for cultural, tourist and leisure activities.

At the national level, the reform of labour legislation is clearly a crucial factor in the reorganisation of working time. Governments and policy-makers should define a new legal framework within which social and economic agents may negotiate flexibility and reduction in working time at different levels. Clearly, the feasibility of such policies depends on the existence of a sound political consensus in that direction. That the political authorities, unions and employers associations build up such consensus clearly represents a crucial pre-condition.

Particularly, the role of unions and employers associations appears to be crucial for the practical implementation of a reduction and reorganisation of working time. Given a national generally oriented law, working time schedules have to be defined at the micro-level, taking into account the local communities’ standards and specific needs, the local, national and international competitive arenas, the specific needs expressed by the firms and the correspondent workforces. All these interests and needs are matter of negotiation and imply the design of a sort of "best practice manual" for setting up a fruitful negotiation procedure.

 In the following tables some empirical evidence regarding 14 industrialised and newly industrialised countries (plus the European Union) are reported. In particular, relative changes during the last two decades are computed for the following variables: population, employment, working time per employee and total working time (derived as the multiplication of employment times the working time per employee). It has to be noticed that working time per employee generally excludes at least agriculture and the public sector, while the employment series refer to the overall employment; thus, in computing total working time it has been assumed that the average working time can also be applied to the excluded sectors. Table 2, instead, is limited to the manufacturing sector and all the series refer to this aggregate.

 Table 1: Long Run Percentage Changes for the Whole Economy

Sources and Methods:

Population: Data Stream for US, Japan, Canada, West Germany, France, Italy, UK.

OECD National Accounts for Australia, Turkey and Mexico.

African Statistical Yearbook for Egypt and South Africa.

Asian Statistical Yearbook for Philippines and India.

Employment: Data Stream for Japan, Italy, France, Canada.

OECD National Accounts for UK and West Germany.

ILO for US, Australia, Turkey, Egypt, Philippines, India, Mexico

Working Time: the series is computed as the product of average yearly hours of work (or weekly average hours of work multiplied by the number of weeks worked in the year) and total employment. Part-time employment is taken into account in the calculus of average hours of work.

Working Time per employee is given by the ratio of Working Time and Employment; in other words, it coincides with the average yearly (or weekly) hours of work used to compute the Working Time series.

Average yearly hours of work:

Average Weekly Hours of Work:

Philippines, Turkey, Egypt: ILO

As it can be seen, data on working time for the entire economy are available only for 11 out of 14 countries. In most of the countries per-capita working time shows a decreasing trend, but this tendency cannot be generalised since the US reveal an opposite trend. However, with the notable exception of the US, the historical trend towards a shorter per-capita yearly working time seems to continue in the recent decades all over the world.

Once the attention is turned towards the growth of the total volume of work (total working time), more striking differences emerge among the industrialised countries. In particular, it is important to see the differences between the US and , to a lesser extent, Canada and Australia on the one side and Japan and European countries on the other. While the three former countries have shown an obvious capacity to extend their total use of labour, Japan is lagging behind and Europe even shows a decrease in total working time (see also Unemployment and Technical Change) In other words, in the US, Canada and Australia an appreciable employment growth couples with an increase in the total need of work (job creation), while in Europe a quite slower employment growth is more than counterbalanced by the historical decline in per-capita working time (this tendency results more striking in continental Europe). Japan lies in an intermediate position.

Finally, the three newly industrialised countries (Philippines, Turkey and Egypt) show an obvious increase in employment and working time. The proportions of such increases have to be correlated both with the population growth and with the shift from agriculture and informal sectors to officially registered jobs.

 Table 2: Long Run Percentage Changes for the Manufacturing Sector

Sources and methods:

Source: ILOs

Employment consists of Paid Employment in Manifacturing.

Per Capita Working Time is derived from the Average Weekly Hours of Work series.

Total Working Time in Manufacturing is obtained as the product between Paid employment in Manufacturing and Per Capita Working Time in Manufacturing.

As far as manufacturing is concerned, data on working time are available for all countries but Italy and three groups of countries emerge.

A first group of industrialised countries (the US and Japan) shows a tendency to increase the use of labour in manufacturing: for Japan this is true both in terms of number of employees and in terms of total working time (although per-capita working time is decreasing). For the US this is true only in term of total working time, since the increase in per-capita working time counterbalances the reduction in employment. Notably, the increase in per-capita working time in the US manufacturing is consistent with the general tendency emerged for the whole US economy (see table 1). Yet, in manufacturing, the US are not anymore the only country characterized by this unexpected tendency, since slighter increases in per-capita working time are also detectable in Australia, the UK, India and Egypt. The positive sign of this indicator can be taken as a proxi of an increase in the overall labour exploitation in manufacturing sectors in these countries.

On the contrary, a clear tendency to deindustrialisation turns out in France, the UK, Australia and to a lesser extent in West Germany and Canada. In more detail, if per-capita working time trends are taken into account, the sharpest decrease in the total amount of work is in France, followed by Australia, the UK and West Germany (whose decrease in employment is not dramatic only because of the contemporaneous decrease in per-capita working time).

In five out of the the six newly industrialised countries, manufacturing employment shows important increases, which are particularly dramatic in the Philippines, Turkey and Mexico. On the contrary, employment stagnation has occurred in India. Per-capita working time turns out to be characterised by slowly increasing or decreasing trends which are non comparable with huge employment expansions. As a result, in five of the six countries total working time in manufacturing is dramatically expanding as an obvious consequence of industrialisation (the exception being India again). Also in this case, statistics have to be considered in a very cautious way, since they are affected by dramatic shifts from agriculture and informal economy to regular manufacturing jobs.

References

* The reduction of working time can be proposed within a philosophical perspective where progress means an increase in the opportunity to enlarge leisure and self-determination. In this view, the increase in the rate of productivity growth leaves time for non market activities where individual creativity and social values can be properly developed. Thus, technical change makes possible to reward both sides of human activities: while work can be associated with a normal wage paid by the firms, self-oriented activities can be compensated through a "second cheque" delivered by the state (see Aznar, 1993, chap.5). Three important examples of this philosophical French tradition are the following:

Aznar G (1993), Travailler moins pour travailler tous. 20 Propositions, Syros éditeur, Parigi.

Gorz A. (1989), Critique of Economic Reason, London, Verso.

Gorz A. (1993), Préfacions, in Aznar G, Travailler moins pour travailler tous. 20 Propositions, Syros éditeur, Paris.

* Historical trends of working time are very difficult to compute and even nowadays data on working hours are not fully reliable in all national accounts. A reliable attempt to estimate long-run historical trends in annual and weekly working time across different countries can be found in the following works by Maddison:

Maddison, A. (1979), Phases of Capitalist Development, New York, Oxford University Press.

Maddison, A. (1991), Dynamic Forces in Capitalist Development: A Long Run Comparative View, Oxford, Oxford University Press.

* As it is clear from the previous sections, current economic and institutional changes call for a reduction and re-organisation of working-time. The main institutional breaks concern: 1) the crisis of Fordism and mass production (see Boyer’s studies); 2) the diffusion of ICT (see Freeman et al.); 3) the developing of a "post-industrial service society" (see Gershuny, Petit-Soete; Ray, Soete). The reading of the following references can be of great interest to those who are interested to connect the reduction and re-organisation with a more general new institutional setting.

Boyer, R. (1988a), Technical Change and the Theory of Regulation, in G. Dosi et al. (eds), Technical Change and Economic Theory, London, Pinter.

Boyer, R. (1988b), New Technology and Employment in the 1980s: from Science and Technology to Macroeconomic Modelling, in Kregel, J.A., Matzner, E., Roncaglia, A. (eds), Barriers to Full Employment, London, Macmillan.

Boyer, R. (1989), Synthesis Report: New Directions in Managment, OECD Helsinki Conference on Education Practices and Work Organization: Technological Change as a Social Process, 11-13 December, Paris, OECD.

Boyer, R. and Caroli, E. (1993), Production Regimes, Education and Training System, RAND Conference on Human Capital, 17 November, Santa Barbara, Rand.

Freeman, C., Clark, J., Soete, L. (1982), Unemployment and Technical Innovation, London, Pinter.

Freeman, C., Soete, L.(1994), Work for All or Mass Unemployment? Computerized Technical Change into the Twenty-First Century, London-New York, Pinter.

Gershuny, J. (1994), Changing Time, Oxford, Oxford University Press.

Hewitt, P. (1993), About Time: The Revolution in Work and Family Life, London, IPPR/Rivers Oram Press.

Howe, W.J. (1986), The Business Services Industry Set Pace in Employment Growth, Monthly Labour Review, April, pp. 29-36.

ILO (1989), Conditions of Work Digest: Part-Time Work, Geneva, International Labour Office

Lundvall, B.Å., Johnson, B. (1994), The Learning Economy, Journal of Industrial Studies, Vol. 1, No.2, December, pp. 23-42.

Perez, C. (1981), Structural Change and Assimilation of New Technologies in the Economic and Social System, Futures, Vol. 15, pp. 357-375.

Petit, P., Soete, L. (1997) Is a biased technological change fueling dualism?, paper presented at the TSER conference on "Technology, Economic Integration and Social Exclusion", Paris, October 17-18.

Ray, G. F. (1986), Services for Manufacturing, National Institute Economic Review, August, pp. 30-32.

Rothwell, R., Freeman, C., Horlsey, A., Jervis, V.T.P., Robertson, A. B. and Townsend, J. (1974), SAPPHO Updated: Project SAPPHO Phase II, Research Policy, Vol. 3, n.3, pp. 258-91.

Soete, L. (1987), The Newly Emerging Information Technology Sector, in Freeman, C., Soete, L. (eds), Technical Change and Full Employment, Oxford, Basil Blackwell.

* Turning the attention to the economic theory, some studies have pointed out that the relationships among growth, productivity and employment have exhibited deep modifications during the last two decades. While economic growth keeps on being a necessary condition for employment growth, sometimes it is not a sufficient condition. In the latter case, a reduction in per-capita working time might be a complementary measure to achieve full employment. A discussion of the economic theory and some interesting empirical evidence can be found in the following references:

Appelbaum, E. and Schettkat, R. (1995), Employment and productivity in Industrialized Countries, International Labour Review, Vol. 134, n.4-5, pp. 605-623.

Padalino, S. - Vivarelli, M. (1997), The Employment Intensity of Economic Growth in the G-7 Countries, International Labour Review, Vol. 136, pp. 191-213.

Pianta, M. (1995), Technology and Growth in OECD countries, 1979-1990, Cambridge Journal of Economics, Vol. 19, n. 1, pp. 175-87

Pianta, M., Evangelista, R. and Perani, G. (1996), The Dynamics Of Innovation and Employment: An International Comparison, Science, Technology Industry Review, N. 18, pp. 67-93

Vivarelli, M., Evangelista, R. and Pianta, M., (1996), Innovation and Employment in Italian Manufacturing Industry, Research Policy, Vol. 25, 1013-26.

* At any rate, the bulk of the economic analysis devoted to the employment impact of a reduction in working time is rather technical and deeply rooted in mainstream economics. These analytical models are generally based on a framework where the demand for labour is inversely related to the cost of labour. Thus, most of these models suggest that a decrease in working time can likely lead to an increase in the cost of labour and so to a decrease in the demand for labour. Indeed, the paradoxical and counter-intuitive result which associates a decrease in working time with an increase in the unemployment level can be found in Booth et al., Calmfors et al.., Dréze, Hoel et al., Toedter. More open approaches characterise Whitley et al. and Seifert, while a complete survey of the theoretical literature on this subject can be found in Corneo.

Booth A.-Schiantarelli F. (1987), The Employment Effects of a Shorter Working Week, Economica, vol. 54, pp. 234-248.

Calmfors L.-Hoel M. (1988), Work Sharing and Overtime, Scandinavian Journal of Economics, vol 90, pp. 45-62.

Calmfors L.-Hoel M. (1989), Work Sharing, Employment and Shifwork, Oxford Economic Papers, vol. 41, pp. 758-773.

Corneo G. (1994a), On the Welfare Effects of Work Sharing, mimeo, Direction de la Prevision.

Dreze, J. H. (1986), Work Sharing: Some Theory and Recent European Experience, Economic Policy, vol.3, pp. 561-619.

Hart R. (1987), Working Time and Employment, Allen and Unwin eds, Londra.

Hoel, M. (1986), Employment and Allocation Effects of Reducing the Length of the Workday, Economica, vol.53, pp. 75-85.

Hoel, M. - Vale, B. (1986), Effects of Working Time in an Economy where Firms Set Wages, Memorandum from Department of Economics, n.2/85, University of Oslo.

Santamäki-Vouri, T. (1984), The overtime pay premiunm, hours of work, and employment, Working Paper, Helsinki School of Economics, vol. 75.

Seifert, H. (1991), Employment Effects of Working Time Reductions in the Former Federal Republic of Germany, International Labour Review, Vol. 130, n.4.

Toedter K.H. (1988), Effects of Shorter Hours on Employment in Disequilibrium Models, European Economic Review, vol.32, pp.1319-1333.

Whitley, J.D. - Wilson, R.A. (1986), The impact on Employment of a reduction in the length of the working week, Cambridge Journal of Economics, vol. 10, pp. 43-59.

* The policy debate about the reduction of working time is dominated by the relevance of the employment consequences of such a reduction: while unions and leftist parties underline the opportunity of work-sharing, the conservative point of view is based on the economic models discussed above and tends to overestimate the counter-effects of a reduction of working time and so the possibility of a perverse final impact on employment. Another point of policy concern is the degree of consensus, among workers, about the possibility of shifting productivity gains into free time rather than into higher wages. As far as both problems are concerned, the recent book by Cette and Taddei is a very useful reading. With regard to the possibility of perverse counter-effects, the authors turn the attention to the need of "complementary measures" which have to be coupled with the reduction of working time (pp. 297 and ff.); while the need of a larger consensus among workers is correctly pointed out (pp. 170 and ff.). Other useful references concerning the policy debate are the following:

Bosch, G. (1986), The Dispute over the Reduction of the Working Week in West Germany, Cambridge Journal of Economics, Vol. 10, pp. 271-90.

CEC (1993), Growth, Competitiveness, Employment, White Paper (Delors Report), December, Brussels, CEC.

Cette G. - Taddéi, D. (1997), Réduire la durée du travail: De la théorie à la pratique, France, Le Livre de Poche.

Holland, S. (1993), The European Imperative: Economic and Social Cohesion in the 1990s: A Report to the CEC, Nottingham, Spokesman.

Taddéi, D. (1991), Temps de travail, emploi et capacités de production, la réorganisation-réduction du temps de travail, Europe Sociale, Supplément 4/91.