The labor supply of self-employed workers: The choice of working hours in worker co-ops

This paper examines a particular subset of self-employed workers, namely, those who own and manage the plant where they work. * Using observations on the plywood co-ops in Washington, workers' hours are a negative function of the hourly wages: the income effect of a wage change dominates the substitution effect. * Although work hours fall in response to higher wages, the drop in hours is not sufficiently large as to reduce workers' annual earnings. * Using cases of a mill changing ownership, workers' hours are lower than when the workers own and manage the mill. Workers in cooperatives are sel... Mehr ...