Thursday, 11 May 2017

The beauty premium in undergraduate study is small, and more attractive women major in economics

Those are two of the conclusions from this 2015 paper by Tatyana Deryugina (University of Illinois at Urbana-Champaign) and Olga Shurchkov (Wellesley College), published in the journal Economic Inquiry (ungated earlier version here). The authors used data from "794 alumnae who graduated from an anonymous women’s college between the years 2002 and 2011", and had their pictures rated (for beauty) by 25 male and 25 female students. They then looked at whether more attractive women were more likely to be given higher admission scores, get better grades, choose different majors, and work in different occupations after graduation. They found that:
...once we control for standardized test scores, more attractive women do not receive different admissions ratings, showing that more attractive individuals do not appear to be more capable at the beginning of college, conditional on being admitted...
When we look at college grades, we find that, conditional on their SAT scores and admission rating, more attractive women have a marginally higher GPA... Our conclusion is that if there is a beauty advantage in college courses, it is very small and not driven by bias...
...more attractive women are considerably less likely to major in the sciences and much more likely to major in economics. We find no corresponding selection into humanities, other social sciences, or another group of majors that we label “area studies.”
There is a fairly robust literature demonstrating that there is a beauty premium in the labour market - more attractive people earn more (Daniel Hamermesh has been one of the key authors in this area, and his 2013 book "Beauty Pays" summarises the literature up to that point). Some people assert that the differences demonstrate discrimination against less attractive people. However, other explanations include that more attractive people are more confident and self-assured, and it is those qualities that are being rewarded in the labour market.

This paper offers a different explanation - that more attractive people choose different university majors than less attractive people, and the difference in majors results in different levels of pay (in part because different occupations have different beauty premiums). If attractive women are more likely to major in economics, and economics majors earn more on average than other majors, or that major leads to management jobs where attractiveness is more greatly rewarded, then attractiveness would be correlated with wages after graduation. Deryugina and Shurchkov don't have data on the wages of the women in their sample, but they do know their occupation. They write:
Consistent with our results on academic major selection, we find that more attractive women are much more likely to become consultants and managers and much less likely to become scientists and technical workers (including paralegals, technical writers, technicians, and computer programmers). Previous work has shown that earnings vary substantially by major and occupation...
 ...a back-of-the-envelope exercise suggests that at least half of the beauty premium in the labor market is explained by major/occupational choice and that managerial professions exhibit a larger return to beauty than scientific professions.
This study was based on women at a single US university, so it would be interesting to see whether these results extend to men, to other universities, and especially to co-ed universities. There's some future work to come in this space.

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