Advertising and Labour Supply: Workweek and Workyear in U.S. Manufacturing Industries, 1919-76.

This paper attempts to provide an explanation for the finding that 'employed American adults have had no net gain in their leisure time in 30 years' [OWEN, 1976, p. 3], a finding which OWEN goes on to describe as 'somewhat surprising'. Our explanation is sought in the intensity of advertising, which is shown to influence the income-leisure decisions of the labour force. We focus on the workweek and the workyear of production workers in U.S. manufacturing industries, which provide long time series for a group which has remained relatively homogenous over time[1].
Previous studies of the workweek or workyear find that the real wage exerts a negative influence. But no satisfactory analysis has been put forward to explain why hours of work have virtually stopped falling in the post-war period. We suggest that the answer lies in the growth in advertising, which has exercised a cumulative impact on the desire to acquire goods and in consequence has created a reluctance to substitute leisure for income as the real wage rises.
The long-run decline in the workweek in U.S. manufacturing appears to have been arrested in the 1940's, even though the real wage rose continuously over the next 30 years. This paper argues that advertising, by creating a stronger desire for goods, tilts the long-run supply-side decision about work and leisure towards longer hours. It is frequently suggested that the workweek is a poor measure of the leisure choice because leisure is increasingly taken in the form of longer vacations. But whether or not vacation time is allowed for, we find that the negative effect of a rising real wage upon hours of work has been offset by the strong positive impact of aggregate advertising. [ABSTRACT FROM AUTHOR]