We use cookies to provide you with the best possible website experience. This includes cookies that are necessary for the operation of the site, as well as cookies used for anonymous statistics, comfort settings, or displaying personalized content. You can decide which categories you want to allow. Please note that depending on your settings, some features of the website may not be available.

Cookie settings

These necessary cookies are required to enable the core functionality of the website. Opting out of these cookies is not possible.

cb-enable
This cookie stores the user's cookie consent status for the current domain. Expiry: 1 year.
laravel_session
Stores the session ID to recognize the user when the page reloads and to restore their login session. Expiry: 2 hours.
XSRF-TOKEN
Provides CSRF protection for forms. Expiry: 2 hours.
IZA Discussion Paper No. 10454
December 2016
Working Hours, Promotion and the Gender Gap in the Workplace

This paper presents a novel model of promotion within the firm which sheds new light on the interplay between working hours and the odds of subsequent promotion. The model's key feature is the coexistence of two different sources of asymmetric information: (i) the worker's cost of long working hours: and (ii) the worker's OJT ability (the worker's ability to accumulate valuable human capital on the job through learning by doing). The worker's cost of working long hours is known only to the worker, while the worker's OJT ability is accurately assessed only by the firm observing him/her on the job. Long working hours signal the worker's commitment to the firm, which determines the surplus produced when the worker is promoted. Thus, the firm provides the worker with managerial training only after observing the employee's hours worked, a signal of his/her commitment to the firm or lack thereof. The firm's decision to provide training also depends on its private information about the worker's OJT ability, which affects his/her future productivity if and when the worker gets promoted. Upon completion of training, the firm then promotes the worker. The model illuminates under what conditions, it is efficient for the firm to adopt the information revelation strategy – reveal its private information on the worker's OJT ability to him/her before the worker decides on whether to work long hours and signal his/her commitment. Using the model, we show that under a reasonable set of conditions, the firm may find it optimal to adopt the information revelation strategy for women but not for men, and derive an empirical testable hypothesis that the correlation between working hours and subsequent promotion will be stronger for women than for men. We analyze longitudinal personnel data from a large Japanese manufacturing firm and provide rigorous econometric evidence in support of the hypothesis.

Communications
Mark Fallak
mark.fallak@liser.lu
+352 585-855-526
World of Labour
Olga Nottmeyer
olga.nottmeyer@liser.lu
+352 585-855-501
Network Coordination
Christina Gathmann
christina.gathmann@liser.lu

The IZA@LISER Network is a global community of scholars dedicated to excellence in labor economics and related fields, now coordinated at the Luxembourg Institute of Socio-Economic Research (LISER) following its transition from Bonn.

About IZA@LISER Network
Contact
IZA Network (Current Site Operator):

Luxembourg Institute of Socio-Economic Research (LISER)
11, Porte des Sciences
Maison des Sciences Humaines
L-4366 Esch-sur-Alzette / Belval, Luxembourg

IZA Institute (In Liquidation):

Forschungsinstitut zur Zukunft der Arbeit GmbH i. L.
Schaumburg-Lippe-Str. 5-9, 53113 Bonn. Germany
Phone: +49 228 3894-0 | Fax: +49 228 3894-510
E-Mail: info@iza.org | Web: www.iza.org
Represented by: Martin T. Clemens (Liquidator)