Comments on: Work and Play in Europe and America

By: Pigrizia o tassazione? « Economia Politica

Pigrizia o tassazione? « Economia Politica — Thu, 26 Nov 2009 15:09:21 +0000

[...] 2009 Perché gli americani lavorano molte più ore degli europei? Steven Landsburg propone qui alcune [...]

By: Stephan

Stephan — Fri, 20 Nov 2009 15:39:18 +0000

Steve,

Paid vacation days (average working week) in Germany:
1950: 12-15 (48 hours)
1965: 17-22 (41 hours)
1975: 20-26 (40 hours)
1985: 30-31 (38 hours)

I would not call that a revolution. The above is the result of the collective bargaining between employers and unions over the years with the option to opt out for employees (unionized or not).

Although employers must grant paid vacation days, employees must not use them. And 30% don’t use the max. paid vacation days. But 70% prefer to take their 30 days off.

I don’t think there ever existed an opposite preference. Thus no revolution in preferences.

By: Steve Landsburg

Steve Landsburg — Fri, 20 Nov 2009 14:15:51 +0000

Stephan: So your story is that preferences changed suddenly and dramatically all over Europe? What might have caused such a revolution in preferences?

By: Stephan

Stephan — Fri, 20 Nov 2009 13:49:58 +0000

“80% of European workers are unionized,” That’s a joke. Or? Here’s a nice interactive graphic http://bit.ly/4FeIqk about “Trade Unions’ Decline Around the World” from the Economix Blog in the NYT. (Data taken OECD.) There’s a simple explanation for longer vacations in good old Europe: it’s people’s preference and not union pressure on firms.

By: Ron

Ron — Fri, 20 Nov 2009 01:04:46 +0000

The office is less fun and more frantic when theres nobody to
hang out with around the water cooler, nobody to pitch in when
youre facing a deadline,

Except that this is not necessarily a problem. They may have
lots of vacation, but they tend to take them at the same time.
It is widely recognized, for instance, and even mentioned in
guide books, that the Parisians are mostly on vacation come late
summer.

By: Gil

Gil — Thu, 19 Nov 2009 19:32:09 +0000

Could it be differing views on the relative value of each?

http://www.firstthings.com/article/2008/09/003-work-and-play-15

By: Louis Friedel

Louis Friedel — Thu, 19 Nov 2009 18:52:09 +0000

Bruce, you seem to be suggesting that unions act as a guide to achieve an efficient outcome by forcing everyone to work less rather than everyone working more to keep up with their peers.

I think you’d find this to be pretty far from the empirical truth. While there is value to the idea of relative wealth within small social circles, it breaks down dramatically when you expand it to society as a whole and to extreme circumstances such as the situation in Detroit today. I can venture a guess what most automotive industry workers would say if you asked them how happy they are that they now have all this leisure time and are no poorer relative to the rest of their fellow industry workers.

By: Phil

Phil — Thu, 19 Nov 2009 18:33:23 +0000

FYI, a mailman in the 1970s was not paying a high marginal tax rate, unless he was married to an investment banker… Withholding tables may have treated temporary overtime as a permanent income shift and thus increased withholding a lot. That would have maybe hampered the short term cash flow, but not the actual taxes paid.

By: Steve Landsburg

Steve Landsburg — Thu, 19 Nov 2009 18:02:20 +0000

Patrick: In the 1970s, the top marginal rate on labor income never rose above 50%, and that kicked in only above an income of $200,000 (which was a lot more than $200,000 is today). The average taxpayer paid a marginal rate of about 40%.

Now there was in fact a top rate of 70% on investment income, and of course you could argue that this indirectly discouraged labor, because one reason people work is so that they can invest their earnings. So you can argue that the 70% rate might still be relevant here—but it applied to an essentially negligible fraction of the work force.

By: Patrick R. Sullivan

Patrick R. Sullivan — Thu, 19 Nov 2009 17:45:57 +0000

‘In the 1970’s, marginal tax rate in both Europe and America were about 40%.’

??? The top marginal rate was 70% here in the 70s. It dropped, in three stages, in 81-83 to 50%. I remember being told, in the late 70s, by a mailman that he didn’t work overtime because he didn’t get to keep much of the extra money.