| dc.description.abstract | The research focuses on the impact of the reduced standard-hours policy in 2001 and the increasing non-wage labor costs on labor demand in Taiwan, including employment, average working hours and overtime hours. In the past, researches mainly utilize the monthly working hours from the Earnings and Productivity Statistics (EPS) to analyze the impact of standard- hours policy. The EPS is a dataset from firm’s survey. We find that working hours between EPS and Manpower Utilization Survey (MUS), provided by households and individuals, are statistically different, with EPS hours being underestimated due to the incentives faced by firms. This study uses 2-digits-industrial panel data from both EPS and MUS from 1997 to 2015 for empirical analysis. We apply panel regression with Hausman test on employment and average working hour regression. Overtime hour regression is analyzed by Tobit Model.
Empirically, we find that the reduction of standard hours in 2001 has significantly reduced employment and monthly average working hours, and increased overtime hours. The marginal effect of standard-hours policy on working hours depends on data sources, where MUS’s effect is significantly larger than that of EPS. Moreover, the impact of standard-hours policy vary with industrial features, including firm size, workforce educational level, and firm’s automatic level. The effect of non-wage labor costs on employment and working hours also depends on industrial characteristics. We thus conclude that the reduction of standard hours shocks the overall employment. Taiwanese firms are more likely to increase workers’ overtime hours than to hire more workers in responding to the policy of standard-hours reduction. This might explain why working hours in Taiwan are rather long compared to its counterparts in the world. | en_US |