How a Reduction of Standard Working Hours Affects Employment Dynamics

December 1, 1996 a new law was implemented in Portugal to gradually reduce the standard workweek from 44 to 40 h. We study how this mandatory reduction affected employment through job creation and job destruction. There was considerable regional, sectoral and firm-size variation in the share of workers who were affected by the working hours reduction. We exploit this variation to assess the impact of the workweek reduction. We find evidence that the working hours reduction had a positive effect on employment through a fall in job destruction.     

Overreaction to Fearsome Risks

When risks threaten, cognitive mechanisms bias people toward action or inaction. Fearsome risks are highly available. The availability bias tells us that this leads people to overestimate their frequency. Therefore, they also overreact to curtail the likelihood or consequences of such risks. More generally, fear can paralyze efforts to think clearly about risks. We draw on a range of environmental risks to show the following: (1) Fear leads us to neglect probability of occurrence; (2) As fearsome environmental risks are usually imposed by others (as externalities), indignation stirs excess reaction; (3) We often misperceive or miscalculate such risks. Two experiments demonstrate probability neglect when fearsome risks arise: (a) willingness-to-pay to eliminate the cancer risk from arsenic in water (described in vivid terms) did not vary despite a 10-fold variation in risk; (b) the willingness-to-accept price for a painful but non dangerous electric shock did not vary between a 1 and 100% chance. Possible explanations relate to the role of the amygdala in impairing cognitive brain function. Government and the law, both made by mortals and both responding to public pressures, similarly neglect probabilities for fearsome risks. Examples relating to shark attacks, Love Canal, alar and terrorism are discussed.     

文化的引力无穷大

他们为什么出去？又为什么回来？他们都在哪儿？过着什么样的日子?上个世纪90年代出国的“海归”中,他们学历普遍是博士以上,现在更多的人是在做研究;而新世纪出国的“海归”,外面闯荡的经历则更多的给了他们创业的动力和激情。相同的是,他们都被济南特有的文化所吸引。