Are working hours complements in production?

This paper studies the degree of complementarity in working hours among coworkers production. Using matched employer-employee data, we first present facts on within-establishment relationship between wages and worked that are consistent with presence complementarities hours. Next, estimate elasticity substitution find it to be 0.69 aggregate 0.52 1.03 across industries. We validate our estimates by showing industries higher elasticities exhibit greater flexibility Our results suggest gross complements production rather than perfect substitutes, as is typically assumed. An accounting exercise using model estimations suggests hours-wage penalties, due hours, can explain 5 30 percent gender wage gap over life-cycle.