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Business success and businesses' beauty capital

Author

Listed:
  • Pfann, Gerard A.
  • Biddle, Jeff E.
  • Hamermesh, Daniel S.
  • Bosman, Ciska M.

Abstract

We examine whether a difference in pay for beauty is supported by different productivity of people according to looks. Using a sample of advertising firms, we find that those firms with better-looking executives have higher revenues and faster growth than do otherwise identical firms whose executives are not so good-looking. The impact on revenue far exceeds the likely effect of beauty on the executives' wages. This suggests that their beauty creates firm-specific investments, in the form of improved relationships within work groups, the returns to which are shared by the firm and the executive.
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Suggested Citation

  • Pfann, Gerard A. & Biddle, Jeff E. & Hamermesh, Daniel S. & Bosman, Ciska M., 2000. "Business success and businesses' beauty capital," Economics Letters, Elsevier, vol. 67(2), pages 201-207, May.
  • Handle: RePEc:eee:ecolet:v:67:y:2000:i:2:p:201-207
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    References listed on IDEAS

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    1. Hamermesh, Daniel S & Biddle, Jeff E, 1994. "Beauty and the Labor Market," American Economic Review, American Economic Association, vol. 84(5), pages 1174-1194, December.
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    4. Hamermesh, Daniel S. & Meng, Xin & Zhang, Junsen, 2002. "Dress for success--does primping pay?," Labour Economics, Elsevier, vol. 9(3), pages 361-373, July.
    5. Hashimoto, Masanori, 1981. "Firm-Specific Human Capital as a Shared Investment," American Economic Review, American Economic Association, vol. 71(3), pages 475-482, June.
    6. Audretsch, David B & Mahmood, Talat, 1995. "New Firm Survival: New Results Using a Hazard Function," The Review of Economics and Statistics, MIT Press, vol. 77(1), pages 97-103, February.
    7. Biddle, Jeff E & Hamermesh, Daniel S, 1998. "Beauty, Productivity, and Discrimination: Lawyers' Looks and Lucre," Journal of Labor Economics, University of Chicago Press, vol. 16(1), pages 172-201, January.
    8. Welch, F, 1970. "Education in Production," Journal of Political Economy, University of Chicago Press, vol. 78(1), pages 35-59, Jan.-Feb..
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    Citations

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    Cited by:

    1. Arunachalam, Raj & Shah, Manisha, 2010. "The Prostitute's Allure: Examining Returns to Beauty, Productivity and Discrimination," IZA Discussion Papers 5064, Institute for the Study of Labor (IZA).
    2. Victor Ginsburgh & Olivier Gergaud & F. Livat, "undated". "Succes :Talent, Intelligence or Beauty?," ULB Institutional Repository 2013/151568, ULB -- Universite Libre de Bruxelles.
    3. Berggren, Niclas & Jordahl, Henrik & Poutvaara, Panu, 2006. "The Looks of a Winner: Beauty, Gender and Electoral Success," IZA Discussion Papers 2311, Institute for the Study of Labor (IZA).
    4. Jenq, Christina & Pan, Jessica & Theseira, Walter, 2015. "Beauty, weight, and skin color in charitable giving," Journal of Economic Behavior & Organization, Elsevier, vol. 119(C), pages 234-253.
    5. E. Feess & Gerd Muehlheusser & M. Walzl, 2008. "Unfair contests," Journal of Economics, Springer, vol. 93(3), pages 267-291, April.
      • Feess Eberhard & Muehlheusser Gerd & Walzl Markus, 2004. "Unfair Contests," Research Memorandum 050, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    6. Godoy, Ricardo & Reyes-Garcia, Victoria & Huanca, Tomas & Tanner, Susan & Leonard, William R. & McDade, Thomas & Vadez, Vincent, 2005. "Do smiles have a face value? Panel evidence from Amazonian Indians," Journal of Economic Psychology, Elsevier, vol. 26(4), pages 469-490, August.
    7. French, Michael T. & Robins, Philip K. & Homer, Jenny F. & Tapsell, Lauren M., 2009. "Effects of physical attractiveness, personality, and grooming on academic performance in high school," Labour Economics, Elsevier, vol. 16(4), pages 373-382, August.
    8. Olivier Gergaud & Victor Ginsburgh & Florine Livat, 2012. "Success of Celebrities: Talent, Intelligence or Beauty?," Economics Bulletin, AccessEcon, vol. 32(4), pages 3120-3127.
    9. Hamermesh, Daniel S., 2006. "Changing looks and changing "discrimination": The beauty of economists," Economics Letters, Elsevier, vol. 93(3), pages 405-412, December.
    10. Christian Pfeifer, 2012. "Physical attractiveness, employment and earnings," Applied Economics Letters, Taylor & Francis Journals, vol. 19(6), pages 505-510, April.
    11. LIU Xing & SIERMINSKA Eva, 2014. "Evaluating the effect of beauty on labor market outcomes: A review of the literature," LISER Working Paper Series 2014-11, LISER.
    12. Olivier Gergaud & Victor Ginsburgh & florine f. Livat, 2016. "Looking Good and Looking Smart," Working Papers ECARES ECARES 2016-28, ULB -- Universite Libre de Bruxelles.
    13. Price, Michael K., 2008. "Fund-raising success and a solicitor's beauty capital: Do blondes raise more funds?," Economics Letters, Elsevier, vol. 100(3), pages 351-354, September.
    14. Subhani, Muhammad Imtiaz, 2012. "Physical Attractiveness Or Referrals: Which Matters The Most?," MPRA Paper 39105, University Library of Munich, Germany.
    15. Franklin G. Mixon & Steven B. Caudill, 2013. "Campus competition and co-ed allure: An institution-level analysis of collegiate dating markets," Economics Bulletin, AccessEcon, vol. 33(1), pages 442-453.
    16. Seung Chan Ahn & Young Hoon Lee, 2014. "Beauty And Productivity: The Case Of The Ladies Professional Golf Association," Contemporary Economic Policy, Western Economic Association International, pages 155-168.
    17. Eva Sierminska, 2015. "Does it pay to be beautiful?," IZA World of Labor, Institute for the Study of Labor (IZA), pages 161-161, June.

    More about this item

    JEL classification:

    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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