Chapter

Where Does the Wage Penalty Bite?

Edited by Christian A. Gregory and Christopher J. Ruhm

in Economic Aspects of Obesity

Published by University of Chicago Press

Published in print May 2011 | ISBN: 9780226310091
Published online February 2013 | e-ISBN: 9780226310107 | DOI: http://dx.doi.org/10.7208/chicago/9780226310107.003.0012
Where Does the Wage Penalty Bite?

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This chapter discusses the effect of body mass index (BMI) on wages. It examines the shape of the conditional wage function as well as addressing potential biases resulting from endogeneity of BMI and possible reverse causation, whereby wages determine body weight. The potential mechanisms by which BMI affects wages are explored and in particular, understanding gender differences in these effects. It states that women's wages peak at thresholds far below the obesity cutoff, usually at a BMI of twenty-three or lower. This finding is robust to specifications correcting for endogeneity or reverse causation and suggests that BMI does not serve as an index of underlying health or medical costs in a wage-setting context. There are often substantial differences for people of different races, with the main specifications suggesting that the conditional wage function peaks at a considerably higher BMI for minorities and declines more slowly thereafter.

Keywords: body mass index; wages; body weight; gender differences; minorities

Chapter.  10401 words.  Illustrated.

Subjects: Economics

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