Play Hard, Shirk Hard? The Effect of Bar Hours Regulation on Worker Absence
| Author | Maria Navarro Paniagua,Colin P. Green |
| Published date | 01 April 2016 |
| Date | 01 April 2016 |
| DOI | http://doi.org/10.1111/obes.12106 |
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©2015 The Department of Economics, University of Oxford and JohnWiley & Sons Ltd.
OXFORD BULLETIN OF ECONOMICSAND STATISTICS, 78, 2 (2016) 0305–9049
doi: 10.1111/obes.12106
Play Hard, Shirk Hard? The Effect of Bar Hours
Regulation on Worker Absence*
Colin P. Green† and Maria Navarro Paniagua†
†Economics Department, Lancaster University Management School, Lancaster University,
Lancaster, LA1 4YX, UK (e-mail: c.p.green@lancaster.ac.uk, m.navarropaniagua@lancaster.
ac.uk)
Abstract
The regulation of alcohol availability has the potential to influence worker productivity.
This paper uses legislative changes in bar opening hours to provide a potential quasi-
natural experiment of the effect of alcohol availability on working effort, focusing on
worker absenteeism. We examine two recent policy changes, one in England/Wales and
one in Spain that increased and decreased opening hours respectively. We demonstrate a
robust positive causal link between opening hours and absenteeism, although short-lived
for Spain. The effect is long lasting for the UK where we provide evidence which suggests
that increased alcohol consumption is a key mechanism.
I. Introduction
The regulation of alcohol consumption remains a highly contentious area of public policy
and has generated a large literature in both public health and economics (see Anderson,
Chisholm and Fuhr, 2009 and Carpenter and Dobkin, 2011a for recent reviews). Poli-
cies aimed at regulating alcohol are numerous including taxation, minimum pricing, age-
based restrictions, place-based restrictions and restrictions on the timing of sales. Timing
restrictions can take many forms, including restrictions on permissible days and hours of
alcohol availability both on and off premises. For instance, day restrictions include laws
that prevent Sunday sales of alcohol in the United States and Australia; and restrictions
on trading on specific days that were previously common in Scandinavia (Heaton, 2012;
Gr¨onqvist and Niknami, 2014). This type of regulation appears to influence consumption
JEL Classification numbers: J22, K32
*Theauthors would like to thank the editor and two anonymous referees, SilkeAnger, Steve Bradley, Paul Devereux,
Mirko Draca, Javier Gardeazabal, Juan Ramon Garcia, John Heywood,Gareth Leeves, Owen O’Donnell, Efthymios
Pavlidis,Aydogan Ulker, Ian Walker,Anwen Zhang, seminar participants at the University ofWisconsin-Milwaukee,
Kings College London, RWI-Essen,participants at the 4th Annual Meeting on the Economics of Risky Behaviours,
the 11th IZA/SOLE TransatlanticMeeting, the 2012 EEA conference in Malaga, the 2012 EALE conference in Bonn
and the 2013 RES conference in Royal Holloway for helpful comments. Mar´
ia Navarro gratefully acknowledges
financial support from the Spanish CYCIT Research Project ECO2008-06395-C05-03/ECON.
The data were provided bythe UK Data Archive. The data are available on request, subject to registeringwith the
Data Archive.The usual disclaimer applies.
Play hard, shirk hard? 249
behaviour. For instance, Carpenter and Eisenberg (2009) show that allowing Sunday sales
in Ontario, Canada, increased Sunday-specific drinking by 7–15%, mainly in the form of
substitution from drinking on Saturdays. At the same time, restrictions on the timing of on
premise drinking are the norm, but with a wide variation in actual opening hours across
jurisdictions. The aim of these laws is not solely to restrict alcohol availability, but also to
reduce negative externalities from leisure behaviour such as noise pollution and disruption
to residents near venues. This regulation of opening hours has been shown to influence a
range of health and socio-economic outcomes including alcohol consumption (Bernheim,
Meer and Novarro, 2012), traffic accidents (Smith, 1990; Vingilis et al., 2005; Green,
Heywood and Navarro, 2014) and crime (Chikritzhs and Stockwell, 2002; Hough and
Hunter, 2008; Biderman, De Mello and Schneider, 2010; Humphreys and Eisner, 2010;
Carpenter and Dobkin, 2011b).
While mainly aimed at reducing social externalities associated with excessiveconsump-
tion, alcohol regulations also have the potential to influence labour market outcomes. In
terms of alcohol taxation, this idea has attracted some attention. For instance, Johansson,
Pekkarinen and Verho (2014) examine the effect of a cut in alcohol taxation in Finland
which led to large differences in alcohol prices between Finland and Sweden. They show
that this had a weak effect on mortality and alcohol related illnesses but increased work-
place absenteeism, a 5% increase for males and a 13% increase for females in Swedish
regions near the Finnish border when compared to Swedish regions that are over 100 km
away from the border. In contrast, Dave and Kaestner (2002) find no evidence that alcohol
taxes are related to labour market outcomes such as employment, hours of work and wages
in the US.
Restrictions on opening hours also have the potential to influence labour market out-
comes, but this has received little attention to date. Traditionally, the effect of government
regulation of leisure is thought of through the lens of income and substitution effects (see
for instance Burtless and Hausman, 1978; Blundell, Duncan and Meghir, 1998). However,
individual labour supply behaviourcould be influenced directly by leisure regulation if, for
instance, it affects the temporal proximity of leisure consumption and working hours (Bid-
dle and Hamermesh, 1990). Moreover,the timing of consumption could also have spillover
effects into working hours when intoxicating substances like alcohol are involved. Along
these lines, previous evidence suggests that alcohol consumption is linked to absenteeism
(Norstrom, 2006; Johansson, Bockerman and Uutela, 2008; Balsa and French, 2010).
This paper investigates howthe regulation of licensed hours at establishments that serve
alcohol influences working hours, focusing primarily on worker absenteeism. While, there
is no existing evidence along these lines, it has been previously demonstrated that other
forms of alcohol legislation such as minimum drinking ages and reductions in alcohol
taxation can influence workforce productivity (Carpenter and Dobkin, 2011a; Johansson
et al., 2014). We use recent changes in legal pub and club (herein bars for simplicity)
opening hours in the UK and Spain as ‘quasi-natural’ experiments to identify the effect
of on-premise alcohol availability on absence.1These two legislative changes provide a
nice point of comparison, as one involves a substantial liberalization of opening hours (the
UK) while the other involves a similarly substantial decrease in opening hours (Spain).
1We treat absenteeism as a proxyfor worker effort (Audas, Barmby and Treble, 2004).
©2015 The Department of Economics, University of Oxford and JohnWiley & Sons Ltd
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