> From: [EMAIL PROTECTED] (Tom Walker)
> Max Sawicky wrote,
>
> >How do you define the social costs of overtime?
> >Not costs to the worker and employer, mind you,
> >but to third parties.
> >
> >That would inform the design of the tax.
>
> I'm not sure I follow you on this one. The social cost of overtime is
> unemployment (leaving aside excessive overtime, which might be detrimental
> to the worker's health, safety or social participation). This is implicit in
> the way that I've defined overtime -- as the amount by which an employee's
> hours worked exceeded a ratio of total hours worked/labour force (this could
> be a national or regional index, depending on what were the precise policy
> objectives). This is not an argument that overtime, as it is conventionally
> defined, can readily be converted into equivalent hours of new employment.
> The tax takes care of that problem; the hours don't have to be converted.
>
> I'm not sure I follow you because I expect that historical factors would
> have more of an influence on design than the definition of social costs. The
> definition of social costs would be more important for justifying the tax.
> Or is that what you mean by design?
It is one thing to say that overtime is bad for the
following economic reasons and we would like
to discourage it. It is another to put a social
price tag on overtime. The latter would suggest
the proper sort of tax.
It would be helpful to know three things: what sort
of trade-off obtains between overtime and extra jobs,
the values placed on one less and one extra hour,
respectively, by the person working overtime and the
person working 'undertime,' and the social costs of
the additional hour of undertime. We were talking
about accounting, after all, which implies close
quantification of these things.
The first of these items seems pretty difficult to figure.
The second could be derived by standard micro methods,
and the third also seems within reach though its precise
calculation could be all over the lot, depending on
methods employed.
MBS
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Max B. Sawicky Economic Policy Institute
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Opinions above do not necessarily reflect the views
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