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AbstractThis study examines the influence of gender norms on household behaviour and welfare. Using Japanese household data, we find that households with a conventional norm on gender roles spend more time on housework and less money on family‐common goods. To understand the underlying mechanism, we construct a collective labour supply model that explicitly introduces gender norms. We show that an inefficient ratio of wives' household time to that of husbands leads to an increase in the shadow price of domestic goods, through which the norm distorts the time and money allocated to home production and decreases household welfare.

AbstractThe present paper reexamines the causal effect of working hours on workers' mental health. We utilize Japan's 2010 reform of the Labor Standards Act as a social experiment to examine how the increased wage penalty for long overtime work affects working hours and workers' mental health. Utilizing a unique panel dataset containing health behaviours as well as individual, household and workplace characteristics of male workers, we find that the wage penalty reform indeed succeeded in reducing overtime hours and total working hours and that the reductions contributed to better mental health of workers. Further empirical investigation suggests that the reduction effect of the reform on working time is homogeneous among age groups; however, the harmful effect of working time on mental health is large and statistically significant among young workers. Our results suggest that setting a high wage penalty for long overtime work effectively reduces overtime work and improves workers' health outcomes, particularly for young people.