Advanced Search
MyIDEAS: Login

The smoker's wage penalty puzzle: evidence from Britain

Contents:

Author Info

  • Brune, Lasse F.
Registered author(s):

    Abstract

    This work investigates the effect of smoking on wages for male workers using panel data from Britain for the period of 1991-2005. The strong negative correlation of smoking and wages found in a crosssectional analysis reduces substantially when accounting for unobserved individual heterogeneity using Fixed Effects estimation. I find a statistically significant wage penalty that is causally due to smoking of about -2% for smokers over those who quit. Further analysis indicates, however, that the negative effect might be underestimated when comparing with those who never started smoking or quit a long time ago.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: https://www.iser.essex.ac.uk/publications/working-papers/iser/2007-31.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by Institute for Social and Economic Research in its series ISER Working Paper Series with number 2007-31.

    as in new window
    Length:
    Date of creation: 21 Dec 2007
    Date of revision:
    Publication status: published
    Handle: RePEc:ese:iserwp:2007-31

    Contact details of provider:
    Postal: Publications Office, Institute for Social and Economic Research, University of Essex, Wivenhoe Park, Colchester, Essex CO4 3SQ UK
    Phone: 44-1206-872957
    Fax: 44-1206-873151
    Email:
    Web page: https://www.iser.essex.ac.uk/
    More information through EDIRC

    Order Information:
    Postal: Publications Office, Institute for Social and Economic Research, University of Essex, Wivenhoe Park, Colchester, Essex CO4 3SQ UK
    Email:
    Web: https://www.iser.essex.ac.uk/publications/

    Related research

    Keywords:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Silke Anger & Michael Kvasnicka, 2006. "Biases in Estimates of the Smoking Wage Penalty," Discussion Papers of DIW Berlin 654, DIW Berlin, German Institute for Economic Research.
    2. Maria Loureiro & Anna Sanz-de-Galdeano & Daniela Vuri, 2009. "Smoking Habits: Like Father, Like Son, Like Mother, Like Daughter," Working Papers 402, Barcelona Graduate School of Economics.
    3. Almudena Sevilla-Sanz & Mark L. Bryan, 2007. "Does Housework Lower Wages and Why? Evidence for Britain," Economics Series Working Papers 331, University of Oxford, Department of Economics.
    4. van Ours, Jan C., 2004. "A pint a day raises a man's pay; but smoking blows that gain away," Journal of Health Economics, Elsevier, vol. 23(5), pages 863-886, September.
    5. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
    6. Phillip B. Levine & Tara Gustafson & Ann D. Velenchik, 1997. "More bad news for smokers? The effects of cigarette smoking on wages," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 50(3), pages 493-509, April.
    7. Christopher F Baum & Mark E. Schaffer & Steven Stillman, 2002. "Instrumental variables and GMM: Estimation and testing," United Kingdom Stata Users' Group Meetings 2003 02, Stata Users Group.
    8. William N. Evans & Edward Montgomery, 1994. "Education and Health: Where There's Smoke There's an Instrument," NBER Working Papers 4949, National Bureau of Economic Research, Inc.
    9. Munasinghe, Lalith & Sicherman, Nachum, 2004. "Wage Dynamics and Unobserved Heterogeneity: Time Preference or Learning Ability?," IZA Discussion Papers 1436, Institute for the Study of Labor (IZA).
    10. Leigh, J. Paul, 1995. "Smoking, self-selection and absenteeism," The Quarterly Review of Economics and Finance, Elsevier, vol. 35(4), pages 365-386.
    11. Ours, J.C. van, 2004. "A pint a day raises a man's pay, but smoking blows that gain away," Open Access publications from Tilburg University urn:nbn:nl:ui:12-140957, Tilburg University.
    12. Chaloupka, Frank J. & Warner, Kenneth E., 2000. "The economics of smoking," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 29, pages 1539-1627 Elsevier.
    13. Victor R. Fuchs, 1982. "Time Preference and Health: An Exploratory Study," NBER Chapters, in: Economic Aspects of Health, pages 93-120 National Bureau of Economic Research, Inc.
    14. Lokshin, Michael & Beegle, Kathleen, 2006. "Forgone earnings from smoking : evidence for a developing country," Policy Research Working Paper Series 4018, The World Bank.
    15. Heineck, Guido & Schwarze, Johannes, 2003. "Substance Use and Earnings: The Case of Smokers in Germany," IZA Discussion Papers 743, Institute for the Study of Labor (IZA).
    16. M. Christopher Auld, 2005. "Smoking, Drinking, and Income," Journal of Human Resources, University of Wisconsin Press, vol. 40(2).
    17. Grossman, Michael, 1972. "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy, University of Chicago Press, vol. 80(2), pages 223-55, March-Apr.
    18. Charles L. Baum & William F. Ford & Jeffrey D. Hopper, 2006. "The Obese Smoker's Wage Penalty," Social Science Quarterly, Southwestern Social Science Association, vol. 87(4), pages 863-881.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:ese:iserwp:2007-31. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Paul Groves).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.