The Beauty Premium

My Principles textbook has a case study on the economic benefits of being beautiful (in the chapter Earnings and Discrimination). In today's NY Times, economist Hal Varian has an article in the Business section describing new research on the topic by Markus Mobius of the Harvard economics department and Tanya Rosenblat of Wesleyan University. The research is based on experiments in which some people are asked to hire other people to perform certain tasks. Two conclusions:

1. Employers thought beautiful people were more productive even when their only interaction was via a telephone interview. It appears that the confidence that beautiful people have in themselves comes across over the phone as well as in person.

2. Employers (wrongly) expect good-looking workers to perform better than their less-attractive counterparts under both visual and oral interaction, even after controlling for individual worker characteristics and worker confidence.

These results suggest that the beauty premium is not entirely rational on the part of employers. This seems to undercut the point of view advanced by my colleague Robert Barro a few years ago in this opinion piece.

You can find the research paper here.