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  • P-ISSN 1738-656X

한국개발연구. Vol. 14, No. 4, December 1992, pp. 107-121

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Motives for Moonlighting and Its Policy Implications (Written in Korean)


Author & Article History

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Moonlighting or second-jobs will increase shirking of the primary job. This paper analyzes the motives for moonlighting so that the means of reducing these motives could be explored. The traditional theory claims that a worker who cannot fully realize his work potential will look to moonlighting. In a two period model, however, the following motives are more important. The precautionary savings motive : A worker has an incentive to save for fear of losing his job and his income in the second period. The worker could save more by working more during the first period, and this additional motive for working is the precautionary savings motive. The insurance motive : When a worker is unemployed, he cannot expand his moonlighting hours according to his needs since the moonlighting hour is upward rigid. Therefore, a worker has an incentive to secure additional moonlighting hours in the first period so that quick adjustment can be made during the unemployment in the second period. Two policy measures to remove those motives for moonlighting are recommended, for these measures will enhance the productivity in the primary job. First, a firm should guarantee that there will be no layoffs in a downturn in the economy and that the employment level is adjusted to the economic states by work sharing among workers. Second, as unemployment insurance benefits compensate a portion of the income in case of unemployment, it substitutes the motives for moonlighting. A generalization of this argument can be found in Ehrlich and Becker(1972) where self-insurance(moonlighting) and market insurance( in this case, unemployment insurance) serves as substitutes. The two policy measures in the above have a spill-over effect : A decrease of labor supply in the moonlighting market will ease job search, and therefore will help those who have their primary job in the moonlighting sector.

JEL Code

J49, J64

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