everyday economics 

Hey, Gorgeous, Here's a Raise!
As for you fatties, we're cutting your salaries.
By Steven E. Landsburg

Monday, July 9, 2001, at 10:00 a.m. PT


 
"I know what wages beauty gives," said the poet William Butler Yeats 
about a century ago. Modern econometricians know more precisely. In 
their published research, Professors Daniel Hamermesh and Jeff Biddle 
estimate that if you're perceived as beautiful, you probably earn about 
5 percent more than your ordinary-looking counterparts.

As beauty is rewarded, so ugliness is penalized. Ugly women earn about 5 
percent less than other women, and ugly men earn about 10 percent less 
than other men. That's right; the market punishes men more than women 
for being unattractive. Moreover, men's looks haunt them at every stage 
of their careers: Better-looking men get more job offers, higher 
starting salaries, and better raises. For women, good looks will get you 
better raises but usually not better job offers or starting salaries. (A 
note on Hamermesh and Biddle's methodology: Beauty was assessed by 
panels of people who judged photographs of the study's subjects.)

But while men suffer more for being ugly, women and *specifically white 
women* suffer more for being fat. In a paper from last year, Professor 
John Cawley found that an extra 65 pounds typically cost a white woman 7 
percent of her wages. To put this another way, if you're a seriously 
overweight white woman, losing 65 pounds is likely to be as lucrative as 
an extra year of college or three extra years of work experience. For 
men and for black women, weight has no effect on wages. (The people in 
Cawley's study self-reported their weights.)

Since beauty and slenderness are associated with good pay, we can ask 
which way the causality runs. Do some people look better because they 
earn more, or do they earn more because they look better?

Surely to some extent money buys beauty. The more you earn, the more you 
can spend on cosmetics, health care, and plastic surgery. And higher 
earnings can lead to higher self-esteem, which in turn leads to better 
eating habits. But Hamermesh, Biddle, and Cawley believe these effects 
are small, for several reasons. First, there's a limit to how much you 
can accomplish with cosmetics. Second, the correlation between wages and 
beauty is strongest among the young, who are the least likely to have 
benefited from health care and plastic surgery. And finally, Cawley has 
devised some subtle statistical tests that tend to rule out the "high 
wages cause self-esteem which causes better eating" theory.



 
If high wages don't cause beauty, then presumably beauty causes high 
wages. But why? One guess is that certain high-paying occupations (like 
"fashion model" or "romantic lead") are closed to all but the most 
beautiful. But that can't explain why beautiful auto mechanics earn more 
than plain-looking auto mechanics, beautiful teachers earn more than 
plain-looking teachers, and so on through a long list of occupations.

Well, then, why do employers pay more for beautiful workers? Is it just 
because beautiful workers are more fun to look at, or does their beauty 
make them more productive, say by breeding self-confidence or by 
attracting customers? (My boon companion Marian Heller points out that 
self-confidence can pay off in another way by fostering the courage to 
seek better jobs and demand better raises.)

Here's some evidence that employers like beauty not for its own sake, 
but because it's productive: Beautiful people are more likely to be 
found in occupations where you'd expect beauty to matter retail sales, 
waitressing, etc. If the beauty premium were generated strictly by 
employers' desire to look at pretty people, it would presumably draw 
beautiful people equally into all occupations.

Now back to the gender gap. Why do ugly men suffer more than ugly women 
in the labor market? Partly it's because many of the ugliest women opt 
out of the labor market altogether, so they aren't counted in the 
statistics. In fact, the ugliest married women (the ones who are rated 
in the lowest 6 percent lookswise) are 8 percent less likely to look for 
a job than married women in general. That's a pretty big effect, but 
Hamermesh and Biddle conclude that it doesn't come close to explaining 
the gender gap, which remains a bit of a mystery.

They do point out, though, that low wages are not the only penalty for 
bad looks, and some of the other penalties hit women a lot harder than 
they hit men. Ugly women tend to attract the lowest quality husbands (as 
measured by educational achievement or earnings potential). The effect 
is not symmetric, though: Beautiful women do no better on the marriage 
market than average women. For men, looks don't seem to affect marriage 
prospects at all.

Why does beauty rule the wage market? Why does the market punish fat, 
except when it doesn't? There's a lot we don't understand. If you've got 
a theory that I haven't explored here, send me e-mail, and I'll discuss 
the best ideas in an upcoming column.


This article can be found at 
http://slate.msn.com/Economics/01-07-09/Economics.asp

13 responses total.

/pours sausage gravy on his chicken fried steak.

Another possibility is that whatever physical or emotional or mental
characteristics cause people to work harder and thus end up earning more
money, also causes them to eat less or exercise more.  A may not cause B, they
may both be caused by C.  

I would buy that as a possibility but it does seem odd that being fat 
seems to effect the wages more significantly in one segment of the 
population more than others. I suppose it is possible that obese white 
women are less productive as a group that obese white men or obese black 
women but I dont think it is likely. 

And what about this whole "ugliness" thing. Do you suppose that whatever 
physical or emotional or mental characteristics that cause people to 
work harder also cause them to have unblemished young wrinkle free skin, 
symetrical facial features, good color and shiny hair? Some of the above 
is grooming of course and I guess an argument could be made that well 
groomed people are more likely to be hard workers but many 
characteristics that people consider unattractive just simply are beyond 
the control of the person with those characteristics. And yet, they make 
less money. 

On average, healthier people tend to be more symmetrical, which is generally
perceived as more attractive.   Some times and places have perceived higher
body weights as being more attractive - are there any studies of whether
obesity was correlated with greater earnings under these circumstances?
Used to be that rich men were expected to be fat and smoke cigars, as late
as about 1900.

I have never heard anyone claim that symmetry, especially of facial features,
has anything to do with health. Where did you get that data?

(And, for that matter, I've heard it claimed that people find slightly
*a*symmetrical faces more attractive.)

There have been studies in which people found faces more attractive if either
the left or the right side were duplicated as a mirror image.  Diseases during
gestation and childhood can disfigure people and they indicate poorer general
resistance, sometimes related to genetics, often to environment.  Female birds
also tend to choose showier/larger/more colorful male partners, which
indicates that they are healthier and/or better fed.  Better fed male birds
control better nesting territories.  Presumably healthier and/or better fed
male humans would also control better nesting territories (except that better
fed now has negative connotations - you have to spend more to eat less).
I read of some place in Africa where wives were force fed high-fat foods like
milk to make them attractively rotund.  That is why I suspect that the current
situation, where thin people make more money, is an anomaly.

It's worth remembering that wages are set more by supply and demand than by
a simple desire to be fair.  Then there's the somewhat imperfect nature of
competitive hiring processes, whereby potential employers often don't spend
more than an hour or two with a job candidate before deciding whether to make
an offer.  Job interviews are a situation where first impressions count a lot.
It seems likely to me that those who look good (or at least don't look like
slobs) are likely to make better first impressions, at least assuming they
also come off as knowing how to do the job.  That could lead to more job
offers, to employers thinking the candidate is worth paying more for, and to
employers thinking other employers are likely to outbid them if they bid too
low.  Even if the employers who would make the offer anyway aren't altering
the amount of money they're offering based on the person's appearance, a
greater number of offers would increase the likelyhood that one or more of
the offers would pay really well.  Additional and higher job offers also give
employees more leverage with which to negotiate with employers who didn't
offer as much money in the first place.

I wonder if "better looking" people also have greater self esteem.  My
experience with my own salaries has been that when I'm quiet about the amount
I'm being paid, and acting reasonably content (as I usually am), my salary
tends to stay relatively constant.  However, when I have decided I was being
paid to little and have insisted on more money, I've generally gotten what
I asked for.  My last couple of job changes (the times when I've been forced
to negotiate the sallary issue -- I'm otherwise usually happier ignoring it)
have both more than doubled what I was making at the previous job.  People
who are nervous about asking for too much, for fear of getting turned down
or not getting the job as a result are probably less likely to negotiate
effectively.

That said, my pay has gone up as I've gained weight, but I suspect that had
more to do with gaining experience and the economy.

Of course wages are set more by supply and demand rather than from any 
sense of fairness. One question I like to pose to people sometimes is: 
Is this ok? I mean our government can intervene and say things like "It 
isnt ok to discriminate based on certain characteristics, e.g weight, 
race, gender, etc. Some people feel that the benefits of fairness 
outweigh the benefits of efficiency. Other people say that benefits of 
efficiency are best. And some people will even say that the market will 
promote fairness because it is effiecient. I always like to hear 
people's opinions about this. 

My opinion is that the benefits of fairness are worth the laws against 
discrimination for the most part. I dont think the costs of such laws 
are that great and the benefits are tremendous, imho.  

I think it is entirely possible that confidence is an issue here. I 
wouldnt doubt it if someone found that people who ask for raises are 
more likely to get them and also that overweight people (especially 
women) are more likely not to have the confidence to ask for raises. 
This might not be an issue of discrimination at all. 

If indeed people who aren't "good looking" have on average less self
confidence, the next question to ask is why.  Is it that people with less self
confidence spend less time making themselves "look good," or is it that people
who don't "look good" aren't as used to being told yes to requests, and are
therefore less likely to expect it?  In the latter case, this would certainly
be a matter of societal discrimination, whether or not it's a matter of
discrimination by the specific employer.  On the other hand, maybe no such
relationship between appearance and self confidence exists, and I'm just
theorizing baselessly.

In an ideal world, I suppose it would be nice if pay rates were based on
fairness.  However, I'm not sure how that would be defined, and in the cases
I'm aware of where it's been tried, or at least been claimed to have been
tried, enforcement has been a nightmare.  Communism was a system that claimed
to take "from each, according to his ability," and give "to each, according
to his need."  That's one approach to "fairness," especially when contrasted
with capitalism, perhaps best described as "from each, according to his need,
and to each, according to his ability."  However, the people living in
communist systems haven't seemed to like them much, and the system (at least
in its extreme form) has only been temporarily sustainable through the use
of brutal dictatorships.

Perhaps, however, the communist model of people doing what they were told,
living where they were told to live, and getting paid a set amount isn't
really what we mean by fairness.  What is?  I see periodic protests calling
for "equal pay for equal work."  How is "equal work" defined?  If there really
are two people of the same intelligence, skil, and experience level doing
exactly the same thing in the same amount of time, I suppose that should
probably count as equal work.  But then, once we've determined that the two
people should probably be paid the same amount, what happens if one of them
is getting what he sees as a better offer.  Perhaps the offer is for more
money, but requires living somewhere else, something the person receiving the
offer doesn't mind, but something which the colleague doing equal work would.
In other words, it's the willingness to move that makes the employee receiving
the other offer worth more to the new company than the employee's colleague
at the old company.  How should the old company respond?  Should they refuse
to increase the employee's pay to keep the employee, on the grounds that
paying that employee more than the other employee would be unfair?  Should
they raise the pay of both employees, even if they could easily have kept the
employee who wasn't threatening to quit happy on his current salary?  Or is
it ok to raise the pay of just the employee whose pay needed to be raised to
keep him?  What if the situation is different?  What if the employee
potentially being hired away is being offered his new job for some other
skill, which the other employees don't have?  Even if that other skill has
no direct bearing on the current job, is it fair that somebody who has taken
the time to develop other marketable skills shouldn't be compensated more than
somebody who has developed only the skills necessary for their current job?
How about somebody, as in the first example, who is willing to live where
their employer wants them to live, rather than insisting on a particular
location?  Should that be worth something?  And what if somebody's only extra
skill is in negotiation?

That much, however, was the easy part of the fairness question.  Far greater
income disparities exist between people with and without education or
experience, and people in different lines of work.  I'm extremely grateful
that earier in my career, there were companies willing to consider my
willingness to work for low wages a good trade for my lack of experience. 
However, I've heard others in my industry (mostly older and more experienced
people demanding to be paid far more than I was making early in my career)
complaining loudly that companies hiring young inexperienced workers for low
wages are being discriminatory in not hiring people with more experience. 
Then there's the example of people in different lines of work.  There were
some protests in the Bay Area last summer, when some of the world's richest
companies were paying some of the world's richest managers and high tech
employees very well, and paying their janitors very little.  It was pointed
out repeatedly and correctly that the janitors were getting paid very little
for long hours of hard and unpleasant work.  Yet, there was a steady supply
of people willing and able to be janitors for those low wages, and a big
shortage of people willing and able to do the higher paying jobs.  With people
willing to do the janitor jobs for low wages, is the solution to insist that
the janitors be paid more anyway, or for people who want to be paid more to
learn to do jobs that are more in demand?

When I talk of policy that promotes fairness being good, I dont mean 
policies that are unenforcable or extreamly expensive. In fact, I mostly 
think that the market does take care of discrimination on its own, 
except in cases of consumer discrimination. 

I wouldn't necessarily agree with the argument that Blacks or other 
minorities don't suffer from this as well.  It's more than likely that 
since minorities tend to make less than caucasians of the same gender 
for the same type of work, that the effect of physical beauty or weight 
on their paychecks is barely noticible or overlooked.

That is a possibility that I havent dismissed. Clearly more research 
would be needed. 

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