Abstract
This study establishes empirically a positive relationship between hours worked per week and growth in hourly wages. A four-wave panel survey of men and women who registered to take the Graduate Management Admission Test between June 1990 and March 1991 is used to show that this relationship is especially strong for young professional workers, but it is also present in a more wide-ranging dataset like the 1979 cohort of the NLSY. I nd the relationship to be nonlinear: in the GMAT Registrant Survey, for workers who put in 48 or more hours per week annual wage growth increases by 2 percent per 10 extra hours worked per week. The average eect is zero when hours are less than 47. The positive eect of hours on wage growth can be accounted for both by a learning-by-doing model with heterogeneous preferences for leisure, and by a model of promotions that combines higher per hour productivity in upper levels of the job ladder with worker heterogeneity. Using data on promotions and training, I provide evidence in support of the job-ladder model.
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