Discussion Papers

Use it Too Much and Lose it? The Effect of Working Hours on Cognitive Ability

DP Number DP2016-008
Language 英語のみ
Date March, 2017
Author Shinya Kajitani, Colin McKenzie, Kei Sakata
JEL Classification codes I10, J22, J26
Keywords cognitive ability, endogeneity, gender differences, retirement, working hours
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Using data from Wave 12 of the Household Income and Labour Dynamics in Australia
(HILDA) Survey, we examine the causal impact of working hours on the cognitive ability
of people living in Australia aged 40 years and older. Three measures of cognitive ability
are employed: the Backward Digit Span; the Symbol Digits Modalities; and a 25-item
version of the National Adult Reading Test. In order to capture the potential non-linear
dependence of cognitive ability on working hours, the models for cognitive ability include
working hours and its square. We deal with the potential endogeneity of the decision of
how many hours to work by using the instrumental variable estimation technique. Our
findings show that there is a non-linearity in the causal effect of working hours on
cognitive functioning. For working hours up to around 22–26 hours a week for men and
for 22–30 hours a week for women, an increase in working hours has a positive impact
on cognitive functioning. However, when working hours exceed these hours per week, an
increase in working hours has a negative impact on cognition. Working in excess of 44–
52 hours for men and 44–60 hours for women leads to cognitive scores that are worse
than a person does not work at all. Interestingly, there is no statistical difference in the
causal effects of working hours on cognitive functioning between men and women.