Work and happiness

Abstract

In many OECD countries, governments have passed legislations that seek to reduce the regular hours of work per worker. This has been largely due to increasing evidence on the negative implications of long hours of work on the health, well-being, and productivity of workers. This study answers the question, does a mandatory reduction in the regular hours of work affect the well-being of workers? We exploit a mandatory stepwise reduction in the regular hours of work in Korea from 2004 to estimate the impact using a staggered difference-in-difference specification. We find that while the policy improved the workers’ life satisfaction, it had no significant effect on job satisfaction nor labor income. This impact stems from increases in satisfaction with work hours, family relations, and social relations. We further found that male, older (above 40 years), and low- and average-income workers benefited more from this policy than their counterparts.