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Emulation, Inequality, and Work Hours: Was Thorsten Veblen Right?
Economics Department Working Paper Series
  • Samuel Bowles, University of Massachusetts - Amherst
  • Yongjin Park
Working Paper Number
2004-14
Publication Date
2004
Abstract
We investigate Veblen effects on work hours, namely the way that a desire to emulate the consumption standards of the rich induces longer work hours among the rest. Consistent with our model of these asymmetric social comparisons, greater inequality predicts longer work hours in ten OECD countries over the period 1963-1998. The country fixed effects estimates of the impact of inequality on hours are large, robust, and cannot be explained by conventional incentive effects. In the presence of Veblen effects, a social welfare optimum cannot be implemented by a flat tax on consumption but may be accomplished by progressive consumption taxes.
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DOI
https://doi.org/10.7275/1069200
Citation Information
Samuel Bowles and Yongjin Park. "Emulation, Inequality, and Work Hours: Was Thorsten Veblen Right?" (2004)
Available at: http://works.bepress.com/samuel_bowles/14/