Straight-Time and Overtime: A Sequential-Lottery Approach

  • Aleksandar VASILEV American University in Bulgaria

Abstract

This note explores the problem of aggregation with non-convex labor supply decisions in an economy with both straight time and overtime. In contrast to Hansen and Sargent (1988), the paper models this as a sequential decision. Instead of changing from one to infinity, with a sequential non-convexity, the aggregate elasticity of labor supply for overtime work is a function of overall participation rate, and the aggregate elasticity of labor supply for full-time work depends on the share of workers doing overtime.

References

[1] Hansen, G., and Sargent, T. 1988. Straight time and overtime in Equilibrium, Journal of Monetary Economics, 21: 281-308.
[2] Rogerson, R. 1988. Indivisible Labor, lotteries and equilibrium, Journal of Monetary Economics, 21: 3-16.
Published
2016-08-10
How to Cite
VASILEV, Aleksandar. Straight-Time and Overtime: A Sequential-Lottery Approach. Theoretical and Practical Research in the Economic Fields, [S.l.], v. 7, n. 1, p. 81-84, aug. 2016. ISSN 2068-7710. Available at: <https://journals.aserspublishing.eu/tpref/article/view/322>. Date accessed: 23 jan. 2022.
Section
Theoretical and Practical Research in the Economic Fields

Keywords

Indivisible labor, straight time, overtime, sequential lottery