Monday, May 17, 2004

France's labor laws

Here's an opinion piece in the Telegraph (registration required) discussing France's 35 hour work week. One part of the article says, "Its job-creating benefits are questionable and it has hit small and medium-size businesses particularly hard". Yes, the whole idea of limiting the work week to create jobs is an example of what economists call the lump of labor fallacy. The idea is that if you allow people to work then their work creates jobs as well, where as if you limit people's work load then there is less work to be done.