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Health Human Capital, Height and Wages in China

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Author Info
Wenshu Gao
Russell Smyth

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Abstract

We estimate the returns to height using data from 12 Chinese cities. We present both ordinary least squares (OLS) and two-stage least squares (TSLS) estimates. In the latter height is instrumented using proxies for health human capital accumulated in childhood and adolescence, which influence adult height. The OLS estimates suggest that an additional centimetre of adult height is associated with wages being 1.1 percent higher for males and 0.9 per cent higher for females. The TSLS estimates suggest each additional centimetre of adult height is associated with wages being 4.8 per cent higher for males and 10.8 per cent for females. The difference reflects the fact that the OLS estimates are predominantly determined by the random genetic factors influencing height, while the TSLS estimates also take into account returns from investment in health human capital during childhood and adolescence. These results imply considerable returns to investment in health human capital.

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Paper provided by Monash University, Department of Economics in its series Monash Economics Working Papers with number 05/09.

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Length: 25 pages
Date of creation: 02 Mar 2009
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Handle: RePEc:mos:moswps:2009-05

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Related research
Keywords: China; health; height; wages;

Find related papers by JEL classification:
I10 - Health, Education, and Welfare - - Health - - - General
J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities and Races; Non-labor Discrimination
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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