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More Bad News for Smokers? The Effects of Cigarette Smoking on Labor Market Outcomes

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  • Phillip B. Levine
  • Tara A. Gustafson
  • Ann D. Velenchik

Abstract

This paper uses data from the National Longitudinal Survey of Youth to examine the effect of smoking on wages and employment. The panel nature and household structure of these data enable us to implement methods to account for differences in observed and unobserved individual characteristics that may be correlated with both smoking and wages. Changes in wages associated with changes in smoking behavior and models that utilize sibling comparisons are estimated to address the potential heterogeneity problem. Estimates from alternative specifications all indicate that smoking reduces wages by roughly 4-8%. No robust, statistically significant effect on employment is observed.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5270.

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Date of creation: Sep 1995
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Publication status: published as Industrial and Labor Relations Review (April 1997): 493-509.
Handle: RePEc:nbr:nberwo:5270

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  1. Orley Ashenfelter & David J. Zimmerman, 1993. "Estimates of the Returns to Schooling From Sibling Data: Fathers, Sons and Brothers," NBER Working Papers 4491, National Bureau of Economic Research, Inc.
  2. Kaestner, Robert, 1991. "The Effect of Illicit Drug Use on the Wages of Young Adults," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 9(4), pages 381-412, October.
  3. Douglas Staiger & James H. Stock, 1994. "Instrumental Variables Regression with Weak Instruments," NBER Technical Working Papers, National Bureau of Economic Research, Inc 0151, National Bureau of Economic Research, Inc.
  4. Mullahy, John & Sindelar, Jody, 1996. "Employment, unemployment, and problem drinking," Journal of Health Economics, Elsevier, Elsevier, vol. 15(4), pages 409-434, August.
  5. Charles A. Register & Donald R. Williams, 1992. "Labor market effects of marijuana and cocaine use among young men," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 45(3), pages 435-451, April.
  6. Hamermesh, Daniel S & Biddle, Jeff E, 1994. "Beauty and the Labor Market," American Economic Review, American Economic Association, American Economic Association, vol. 84(5), pages 1174-94, December.
  7. Blackburn, McKinley L & Neumark, David, 1993. "Omitted-Ability Bias and the Increase in the Return to Schooling," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 11(3), pages 521-44, July.
  8. Andrew M. Gill & Robert J. Michaels, 1992. "Does drug use lower wages?," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 45(3), pages 419-434, April.
  9. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, Econometric Society, vol. 47(1), pages 153-61, January.
  10. Susan Averett & Sanders Korenman, 1996. "The Economic Reality of the Beauty Myth," Journal of Human Resources, University of Wisconsin Press, vol. 31(2), pages 304-330.
  11. Jonathan Gruber & Jeffrey D. Kubik, 1994. "Disability Insurance Rejection Rates and the Labor Supply of Older Workers," NBER Working Papers 4941, National Bureau of Economic Research, Inc.
  12. Willis, Robert J., 1987. "Wage determinants: A survey and reinterpretation of human capital earnings functions," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 1, chapter 10, pages 525-602 Elsevier.
  13. Mullahy, John & Sindelar, Jody L, 1993. "Alcoholism, Work, and Income," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 11(3), pages 494-520, July.
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Cited by:
  1. Lalith Munasinghe & Nachum Sicherman, 2005. "Wage Dynamics and Unobserved Heterogeneity: Time Preference of Learning Ability?," NBER Working Papers 11031, National Bureau of Economic Research, Inc.
  2. Sander, William, 1998. "The effects of schooling and cognitive ability on smoking and marijuana use by young adults," Economics of Education Review, Elsevier, Elsevier, vol. 17(3), pages 317-324, June.
  3. Borghans,Lex & Golsteyn,Bart H.H., 2005. "Time Discounting and the Body Mass Index," ROA Research Memorandum, Maastricht University, Research Centre for Education and the Labour Market (ROA) 006, Maastricht University, Research Centre for Education and the Labour Market (ROA).
  4. M. Christopher Auld, 1998. "Wages, Alcohol Use, and Smoking: Simultaneous Estimates," HEW, EconWPA 9808001, EconWPA.
  5. Ermakov, Stepan, 2012. "The impact of smoking intensity on wages in Russia," Applied Econometrics, Publishing House "SINERGIA PRESS", Publishing House "SINERGIA PRESS", vol. 25(1), pages 70-94.
  6. Jonathan Gruber, 2001. "Tobacco at the Crossroads: The Past and Future of Smoking Regulation in the United States," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 15(2), pages 193-212, Spring.
  7. Donald S. Kenkel & Ping Wang, 1999. "Are Alcoholics in Bad Jobs?," NBER Chapters, National Bureau of Economic Research, Inc, in: The Economic Analysis of Substance Use and Abuse: An Integration of Econometrics and Behavioral Economic Research, pages 251-278 National Bureau of Economic Research, Inc.

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