Working Paper: NBER ID: w11693
Authors: Joseph G. Altonji; Emiko Usui
Abstract: Using the Panel Study of Income Dynamics and the Health and Retirement Study, we provide a set of facts about vacation leave and its relationship to hours worked, hours constraints, wage rates, worker characteristics, spouse's vacation leave, labor market experience, job tenure, occupation, industry, and labor market conditions. We show that on average vacation time taken rises 1 to 1 with paid vacation but varies around it, that annual hours worked fall by about 1 full time week with every week of paid vacation, that the gap between time taken and time paid for is higher for women, union members, and government workers, that hourly wage rates have a strong positive relationship with paid vacation weeks both in the cross section and across jobs, and that nonwage compensation is positively related to vacation weeks. We provide evidence that vacation leave is determined by broad employer policy rather than by negotiation between the worker and firm. In particular, it is strongly related to job seniority but depends very little on labor market experience, and for job changers it is only weakly related to the amount of vacation on the previous job.
Keywords: No keywords provided
JEL Codes: J2
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| employer policy (J68) | paid vacation (vp) (J65) |
| job seniority (M51) | paid vacation (vp) (J65) |
| paid vacation (vp) (J65) | vacation time taken (vt) (J63) |
| vacation time taken (vt) (J63) | annual hours worked (J22) |
| vacation time taken (vt) (J63) | demographic characteristics (e.g., women, union members, government workers) (J21) |
| wage rates (J31) | paid vacation (vp) (J65) |