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Treatment Effects in Bunching Designs: The Impact of Mandatory Overtime Pay on Hours

Leonard Goff

arXiv 20 May 2022 · Econometrics

arXiv:2205.10310 · PDF · DOI · OpenAlex · Extracted main text

Abstract

This paper studies the identifying power of bunching at kinks when the researcher does not assume a parametric choice model. I find that in a general choice model, identifying the average causal response to the policy switch at a kink amounts to confronting two extrapolation problems, each about the distribution of a counterfactual choice that is observed only in a censored manner. I apply this insight to partially identify the effect of overtime pay regulation on the hours of U.S. workers using administrative payroll data, assuming that each distribution satisfies a weak non-parametric shape constraint in the region where it is not observed. The resulting bounds are informative and indicate a relatively small elasticity of demand for weekly hours, addressing a long-standing question about the causal effects of the overtime mandate.

Citation extraction

30
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37
in-text mentions
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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Brown, Charles, Hamermesh, Daniel S (2019) Wages and Hours Laws: what do we know? what can be done?0.73732100%
2Hamermesh, Daniel S, Trejo, Stephen J (2000) The Demand for Hours of Labor : Direct Evidence from California0.73732100%
3Bertanha, Marinho, McCallum, Andrew H., Seegert, Nathan (2023) Better bunching, nicer notching0.51121100%
4Blomquist, Soren, Kumar, Anil, Liang, Che-Yuan, Newey, Whitney (2021) On Bunching and Identification of the Taxable Income Elasticity0.51121100%
5Kline, Patrick, Tartari, Melissa (2016) Bounding the Labor Supply Responses to a Randomized Welfare Experiment: A Revealed Preference Approach0.51121100%
6Bishow, John L (2009) A Look at Supplemental Pay: Overtime Pay, Bonuses, and Shift Differentials0.40511100%
7Blomquist, Soren, Kumar, Anil, Liang, Che-Yuan, Newey, Whitney (2015) Individual heterogeneity, nonlinear budget sets and taxable income0.40511100%
8Costa, Dora L (2000) Hours of Work and the Fair Labor Standards Act: A Study of Retail and Wholesale Trade, 1938–19500.40511100%
9(2024) Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees0.40511100%
10Ehrenberg, Ronald, Schumann, Paul (1982) Longer hours or more jobs? : an investigation of amending hours legislation to create employment0.40511100%

Showing the top 10 of 30 scored citations.

Cited by, within the corpus

arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.

Citing paperIntensityMentionsSections
1Identification of Causal Effects with a Bunching Design0.92843
2Identifying causal effects with subjective ordinal outcomes0.73732