Labor Market Effects of Workweek Restrictions: Evidence from the Great Depression
Material type:
- 1945-7707
Item type | Current library | Vol info | Status | Barcode | |
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Dr VKRV Rao Library | Vol. 16, No. 4 | Not for loan | AI837 |
We study the effects of restrictions on the length of the workweek under the President's Reemployment Agreement (PRA) of July 1933 and the National Industrial Recovery Act. We construct a model in which the equilibrium without such a workweek restriction has an inefficiently low level of employment. We find that employment rose by about 24 percent in the month following the imposition of the workweek restriction. Industries with longer workweeks pre-PRA experienced 9.4 percent faster growth in hourly earnings post-PRA, but this increase was not sufficient to prevent a relative fall in weekly earnings in these industries.
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