The effects of bodyweight on wages in urban Mexico

The effects of bodyweight on wages seem to be closely linked to the level of development of the country concerned. In rich countries, overweight and obese workers seem usually penalized, whereas in the poorest societies the fattest tend to earn more. However, in several emerging economies such as Mexico, the nature of the effect is complex and remains still unknown. Given a complex nutritional situation where hunger and obesity coexist, the literature suggests a quadratic relationship in these countries. The main objective of this study is to explore the impact of bodyweight on wages in urban Mexico using panel data from the Mexican Family Life Survey. Two main methodological treatments are highlighted. First, we implement a two-stage model, based on an expanded Mincer earning function, to control for potential sample selection bias and endogeneity problems. Second, we use complementary parametric and semi-parametric estimators in order to analyze accurately the nature of the relationship. Our results show that the effects of bodyweight on wages in Mexico depend on the kind of contract and gender. For employees with formal contracts, BMI tends to have a negative and linear impact on wages, especially for women. By contrast, we find a positive but non-significant causal relationship between bodyweight and wages for employees with informal contracts. Note that this surprising result could concern women particularly. However, the difficulty in well identifying the earning function of such informal employments is likely to overstate this positive effect.