Determination of Average Working Time in Finland

This study explores the determination of average working time in the context of a Nordic welfare state. The study is focused on the Finnish case. The issue is explored by using data from six industries from 1960 to 1996. The main empirical result is that both an increase in labour productivity and a widening of the tax wedge have contributed to a decline in average working time in Finland. These observations are consistent with the predictions of a theoretical model that is based on the notion of equilibrium working hours. Copyright Fondazione Giacomo Brodolini and Blackwell Publishers Ltd 2002.