International Finance Discussion Papers (IFDP)
December 2011
Aggregate Hours Worked in OECD Countries: New Measurement and Implications for Business Cycles
Lee E. Ohanian and Andrea Raffo
Abstract:
We build a dataset of quarterly hours worked for 14 OECD countries. We document that hours are as volatile as output, that a large fraction of labor adjustment takes place along the intensive margin, and that the volatility of hours relative to output has increased over time. We use these data to reassess the Great Recession and prior recessions. The Great Recession in many countries is a puzzle in that labor wedges are small, while those in the U.S. Great Recession - and those in previous European recessions - are much larger.
Full paper (screen reader version)Keywords: Hours worked, great recession, labor wedge
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