The paper recommends phasing in a standard 30-hour working week over 10 years in the event of Scottish independence, with a legal limit to ensure no one works more than 35 hours a week.
The radical redistribution of work would begin with the Scottish Government imposing a shorter week on public-sector staff to show it was feasible.
The goal would be an end to the culture of overwork which results in the UK having some of the longest hours in Europe, leading to stress, poor productivity resulting from fatigue, absenteeism and "social and psychological harm".
A recent survey of UK workers found 57% believed their personal lives had been adversely affected by overwork.
There are around 30,000 registered cases of work-related stress in Scotland each year.
"No-one would build a system like this," the report says of the UK's work culture.
"Our intention is for a four-day, 30-hour week to be one part of building a more equal society and a stronger economy that utilises human resources effectively."
Published tomorrow by the left-wing Jimmy Reid Foundation, "Time for Life" is the latest paper in a series on the Common Weal, the idea that Scotland can be a wealthier, healthier and fairer society by adapting progressive economic and social policies from the Nordic nations.
Its authors include Isobel Lindsay, a former industrial sociologist at Strathclyde University and the musician and broadcaster Pat Kane.
The report advocates a package of wide-ranging measures to support a shorter working week, including a living wage to ensure low-paid workers are not impoverished, tax incentives for employers and mortgage support for higher earners adjusting to the change.
The result, properly phased and supported, should be more jobs and more people in work, it says.
"If all the full-time employees in Scotland worked an optimal 30-hour week, there would be enough hours left over to provide every single person in Scotland seeking employment with up to 30 hours."
One result ought to be a cut in the £2.2 billion bill for housing benefit and Jobseeker's Allowance in Scotland each year as more people enter work.
"A four-day, 30-hour week should not put anyone into poverty as wages should be high enough so that a normal working week is a socially and economically secure working week for the worker," the report says.
"Indeed, a four-day week should be, at a minimum, income neutral, as productivity increases when optimal hours are worked."
In Europe, 12 countries have lower average working hours than the UK, yet 11 of these have higher rates of worker productivity, including Germany, the Netherlands, Norway, Denmark and France.
The US state of Utah introduced a standard working week of four 10-hour days and a three-day weekend in 2008.
A year later, 75% of citizens said they approved and 50% said they were more productive as a result.
A new governor let the scheme drop in 2009, although some Utah cities continued it.
Research on voluntary UK "downshifters" who cut their hours to improve their family lives found 90% were happy with the change, though 55% missed the money they had lost.
The report acknowledges change would not be simple, and would depend on a series of connected measures. However, it says a shorter working week "is not only possible, it is entirely viable".
Government labour market policy "should not just be assessed on GDP, employment and pay; equity in working hours should be a barometer of policy success too", it concludes.
Reid Foundation director Robin McAlpine said: "In France or Holland or Sweden quality of life is at the centre of their politics while in Britain it is treated as a luxury item. Do we even realise that we work the third-longest hours in Europe with the fewest holidays?
"We should be angry at how little political priority is given to time with our families."
However, Iain McMillan, director of CBI Scotland, said fewer working hours would reduce productivity rather than raise it, and said productivity rates in Europe reflected higher capital investment there.
"It's not something that we would support," he said.
Tory economy spokesman Murdo Fraser added: "This is just more cloud-cuckoo land thinking from Common Weal. Only a very small minority of the country would find the prospect of an independent Scotland in which we're all poorer an attractive one."