IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v28y2019i1p65-77.html
   My bibliography  Save this article

The effect of weight on labor market outcomes: An application of genetic instrumental variables

Author

Listed:
  • Petri Böckerman
  • John Cawley
  • Jutta Viinikainen
  • Terho Lehtimäki
  • Suvi Rovio
  • Ilkka Seppälä
  • Jaakko Pehkonen
  • Olli Raitakari

Abstract

This paper contributes to the literature on the labor market consequences of obesity by using a novel instrument: genetic risk score, which reflects the predisposition to higher body mass index (BMI) across many genetic loci. We estimate instrumental variable models of the effect of BMI on labor market outcomes using Finnish data that have many strengths, for example, BMI that is measured rather than self‐reported, and data on earnings and social income transfers that are from administrative tax records and are thus free of the problems associated with nonresponse, reporting error or top coding. The empirical results are sensitive to whether we use a narrower or broader genetic risk score, and to model specification. For example, models using the narrower genetic risk score as an instrument imply that a one‐unit increase in BMI is associated with 6.9% lower wages, 1.8% fewer years employed, and a 3 percentage point higher probability of receiving any social income transfers. However, when we use a newer, broader genetic risk score, we cannot reject the null hypothesis of no effect. Future research using genetic risk scores should examine the sensitivity of their results to the risk score used.

Suggested Citation

  • Petri Böckerman & John Cawley & Jutta Viinikainen & Terho Lehtimäki & Suvi Rovio & Ilkka Seppälä & Jaakko Pehkonen & Olli Raitakari, 2019. "The effect of weight on labor market outcomes: An application of genetic instrumental variables," Health Economics, John Wiley & Sons, Ltd., vol. 28(1), pages 65-77, January.
    • Handle: RePEc:wly:hlthec:v:28:y:2019:i:1:p:65-77
    DOI: 10.1002/hec.3828
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.3828
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.3828?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cawley, John & Maclean, Johanna Catherine & Hammer, Mette & Wintfeld, Neil, 2015. "Reporting error in weight and its implications for bias in economic models," Economics & Human Biology, Elsevier, vol. 19(C), pages 27-44.
    2. Courtemanche, Charles & Pinkston, Joshua C. & Stewart, Jay, 2015. "Adjusting body mass for measurement error with invalid validation data," Economics & Human Biology, Elsevier, vol. 19(C), pages 275-293.
    3. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4, National Bureau of Economic Research, Inc.
    4. Bound, John & Brown, Charles & Mathiowetz, Nancy, 2001. "Measurement error in survey data," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 59, pages 3705-3843, Elsevier.
    5. J.J. Heckman & E.E. Leamer (ed.), 2001. "Handbook of Econometrics," Handbook of Econometrics, Elsevier, edition 1, volume 5, number 5.
    6. Dan-Olof Rooth, 2009. "Obesity, Attractiveness, and Differential Treatment in Hiring: A Field Experiment," Journal of Human Resources, University of Wisconsin Press, vol. 44(3).
    7. Cawley, John (ed.), 2011. "The Oxford Handbook of the Social Science of Obesity," OUP Catalogue, Oxford University Press, number 9780199736362.
    8. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
    9. Cawley, John, 2015. "An economy of scales: A selective review of obesity's economic causes, consequences, and solutions," Journal of Health Economics, Elsevier, vol. 43(C), pages 244-268.
    10. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
    11. Edward C. Norton & Euna Han, 2008. "Genetic information, obesity, and labor market outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 17(9), pages 1089-1104, September.
    12. Sarlio-Lähteenkorva, S. & Silventoinen, K. & Lahelma, E., 2004. "Relative Weight and Income at Different Levels of Socioeconomic Status," American Journal of Public Health, American Public Health Association, vol. 94(3), pages 468-472.
    13. John Cawley, 2004. "The Impact of Obesity on Wages," Journal of Human Resources, University of Wisconsin Press, vol. 39(2).
    14. Joseph J. Sabia, 2007. "The Effect of Body Weight on Adolescent Academic Performance," Southern Economic Journal, John Wiley & Sons, vol. 73(4), pages 871-900, April.
    15. Maximilian D. Schmeiser, 2009. "Expanding wallets and waistlines: the impact of family income on the BMI of women and men eligible for the Earned Income Tax Credit," Health Economics, John Wiley & Sons, Ltd., vol. 18(11), pages 1277-1294, November.
    16. von Hinke, Stephanie & Davey Smith, George & Lawlor, Debbie A. & Propper, Carol & Windmeijer, Frank, 2016. "Genetic markers as instrumental variables," Journal of Health Economics, Elsevier, vol. 45(C), pages 131-148.
    17. Brendan Kline & Justin L. Tobias, 2008. "The wages of BMI: Bayesian analysis of a skewed treatment-response model with nonparametric endogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 23(6), pages 767-793.
    18. Lindeboom, Maarten & Lundborg, Petter & van der Klaauw, Bas, 2010. "Assessing the impact of obesity on labor market outcomes," Economics & Human Biology, Elsevier, vol. 8(3), pages 309-319, December.
    19. John Cawley & Euna Han & Edward C. Norton, 2011. "The validity of genes related to neurotransmitters as instrumental variables," Health Economics, John Wiley & Sons, Ltd., vol. 20(8), pages 884-888, August.
    20. von Hinke Kessler Scholder, Stephanie & Davey Smith, George & Lawlor, Debbie A. & Propper, Carol & Windmeijer, Frank, 2012. "The effect of fat mass on educational attainment: Examining the sensitivity to different identification strategies," Economics & Human Biology, Elsevier, vol. 10(4), pages 405-418.
    21. Cawley, John & Meyerhoefer, Chad, 2012. "The medical care costs of obesity: An instrumental variables approach," Journal of Health Economics, Elsevier, vol. 31(1), pages 219-230.
    22. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    23. Susan Averett & David Stifel, 2010. "Race and gender differences in the cognitive effects of childhood overweight," Applied Economics Letters, Taylor & Francis Journals, vol. 17(17), pages 1673-1679.
    24. Molly Dahl & Thomas DeLeire & Jonathan A. Schwabish, 2011. "Estimates of Year-to-Year Volatility in Earnings and in Household Incomes from Administrative, Survey, and Matched Data," Journal of Human Resources, University of Wisconsin Press, vol. 46(4), pages 750-774.
    25. Johansson, Edvard & Böckerman, Petri & Kiiskinen, Urpo & Heliövaara, Markku, 2009. "Obesity and labour market success in Finland: The difference between having a high BMI and being fat," Economics & Human Biology, Elsevier, vol. 7(1), pages 36-45, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nicola Barban & Elisabetta De Cao & Sonia Oreffice & Climent Quintana-Domeque, 2016. "Assortative Mating on Education: A Genetic Assessment," Working Papers 2016-034, Human Capital and Economic Opportunity Working Group.
    2. Pekkurnaz, Didem, 2023. "Causal effect of obesity on the probability of employment in women in Turkey," Economics & Human Biology, Elsevier, vol. 51(C).
    3. Demirgüç-Kunt, Asli & Torre, Iván, 2022. "Measuring human capital in middle income countries," Journal of Comparative Economics, Elsevier, vol. 50(4), pages 1036-1067.
    4. Jiangli Dou & Limin Du & Ken Wang & Hailin Sun & Chenggang Zhang, 2020. "Wage Penalties or Wage Premiums? A Socioeconomic Analysis of Gender Disparity in Obesity in Urban China," IJERPH, MDPI, vol. 17(19), pages 1-20, September.
    5. Brunello, Giorgio & Sanz-de-Galdeano, Anna & Terskaya, Anastasia, 2020. "Not only in my genes: The effects of peers’ genotype on obesity," Journal of Health Economics, Elsevier, vol. 72(C).
    6. Amin, Vikesh & Flores, Carlos A. & Flores-Lagunes, Alfonso, 2020. "The impact of BMI on mental health: Further evidence from genetic markers," Economics & Human Biology, Elsevier, vol. 38(C).
    7. Christina Hansen Edwards & Johan Håkon Bjørngaard & Jonas Minet Kinge, 2021. "The relationship between body mass index and income: Using genetic variants from HUNT as instrumental variables," Health Economics, John Wiley & Sons, Ltd., vol. 30(8), pages 1933-1949, August.
    8. Barban, Nicola & De Cao, Elisabetta & Oreffice, Sonia & Quintana-Domeque, Climent, 2021. "The effect of education on spousal education: A genetic approach," Labour Economics, Elsevier, vol. 71(C).
    9. Li, Wenchao, 2023. "Gender of children and risky health behaviors: Evidence from China," Economic Modelling, Elsevier, vol. 119(C).
    10. Baert, Stijn & Herregods, Jolien & Sterkens, Philippe, 2024. "What does job applicants’ body art signal to employers?," Journal of Economic Behavior & Organization, Elsevier, vol. 217(C), pages 742-755.
    11. Sanz-de-Galdeano, Anna & Terskaya, Anastasia & Upegui, Angie, 2020. "Association of a Genetic Risk Score with BMI along the Life-Cycle: Evidence from Several US Cohorts," IZA Discussion Papers 13671, Institute of Labor Economics (IZA).
    12. Stephanie Coffey & Amy Ellen Schwartz, 2021. "Towering Intellects? Sizing Up the Relationship Between Height and Academic Success," Center for Policy Research Working Papers 244, Center for Policy Research, Maxwell School, Syracuse University.
    13. Cawley, John & Han, Euna & Kim, Jiyoon & Norton, Edward C., 2023. "Genetic nurture in educational attainment," Economics & Human Biology, Elsevier, vol. 49(C).
    14. Li, Ruxue & Zhang, Yating & Cai, Xue & Luo, Dan & Zhou, Wuai & Long, Tianxue & Zhang, Huijing & Jiang, Hua & Li, Mingzi, 2021. "The nudge strategies for weight loss in adults with obesity and overweight: A systematic review and meta-analysis," Health Policy, Elsevier, vol. 125(12), pages 1527-1535.
    15. Antonio Pacifico, 2023. "Obesity and labour market outcomes in Italy: a dynamic panel data evidence with correlated random effects," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 24(4), pages 557-574, June.
    16. Böckerman, Petri & Viinikainen, Jutta & Vainiomäki, Jari & Hintsanen, Mirka & Pitkänen, Niina & Lehtimäki, Terho & Pehkonen, Jaakko & Rovio, Suvi & Raitakari, Olli, 2017. "Stature and long-term labor market outcomes: Evidence using Mendelian randomization," Economics & Human Biology, Elsevier, vol. 24(C), pages 18-29.
    17. Raymundo M. Campos-Vazquez & Roy Nuñez, 2019. "Obesity and labor market outcomes in Mexico/Obesidad y el mercado de trabajo en México," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 34(2), pages 159-196.
    18. Anna Sanz-de-Galdeano & Anastasia Terskaya & Angie Upegui, 2020. "Association of a genetic risk score with BMI along the life-cycle: Evidence from several US cohorts," PLOS ONE, Public Library of Science, vol. 15(9), pages 1-19, September.
    19. Groves, Jeremy & Wilcox, Virginia, 2023. "The impact of overweight and obesity on unemployment duration among young American workers," Economics & Human Biology, Elsevier, vol. 51(C).
    20. Young-Joo Kim, 2021. "Heterogeneous Impacts of Body Mass Index on Work Hours," IJERPH, MDPI, vol. 18(18), pages 1-12, September.
    21. Willage, Barton, 2018. "The effect of weight on mental health: New evidence using genetic IVs," Journal of Health Economics, Elsevier, vol. 57(C), pages 113-130.
    22. Paolo Nicola Barbieri & Hieu Nguyen, 2022. "Diabetes and Young Adults’ Labor Supply: Evidence from a Novel Instrumental Variable Strategy," Journal of Labor Research, Springer, vol. 43(1), pages 1-23, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jonas Minet Kinge, 2017. "Waist circumference, body mass index, and employment outcomes," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 18(6), pages 787-799, July.
    2. Kinge, Jonas Minet, 2016. "Waist circumference, body mass index and employment outcomes," HERO Online Working Paper Series 2016:4, University of Oslo, Health Economics Research Programme.
    3. Christina Hansen Edwards & Johan Håkon Bjørngaard & Jonas Minet Kinge, 2021. "The relationship between body mass index and income: Using genetic variants from HUNT as instrumental variables," Health Economics, John Wiley & Sons, Ltd., vol. 30(8), pages 1933-1949, August.
    4. Cawley, John, 2015. "An economy of scales: A selective review of obesity's economic causes, consequences, and solutions," Journal of Health Economics, Elsevier, vol. 43(C), pages 244-268.
    5. Kinge, Jonas Minet, 2016. "Body mass index and employment status: A new look," Economics & Human Biology, Elsevier, vol. 22(C), pages 117-125.
    6. Groves, Jeremy & Wilcox, Virginia, 2023. "The impact of overweight and obesity on unemployment duration among young American workers," Economics & Human Biology, Elsevier, vol. 51(C).
    7. Kinge, Jonas Minet, 2015. "Body mass index and employment status: a new look," HERO Online Working Paper Series 2015:3, University of Oslo, Health Economics Research Programme.
    8. Caliendo, Marco & Gehrsitz, Markus, 2016. "Obesity and the labor market: A fresh look at the weight penalty," Economics & Human Biology, Elsevier, vol. 23(C), pages 209-225.
    9. Jaakko Pehkonen & Jutta Viinikainen & Jaana T. Kari & Petri Böckerman & Terho Lehtimäki & Olli Raitakari, 2021. "Birth weight and adult income: An examination of mediation through adult height and body mass," Health Economics, John Wiley & Sons, Ltd., vol. 30(10), pages 2383-2398, September.
    10. Pekkurnaz, Didem, 2023. "Causal effect of obesity on the probability of employment in women in Turkey," Economics & Human Biology, Elsevier, vol. 51(C).
    11. Donal O'Neill & Olive sweetman, 2012. "The Consequences of Measurement Error when Estimating the Impact of BMI on Labour Market Outcomes," Economics Department Working Paper Series n232b-12.pdf, Department of Economics, National University of Ireland - Maynooth.
    12. Cawley, John & Han, Euna & Norton, Edward C., 2009. "Obesity and labor market outcomes among legal immigrants to the United States from developing countries," Economics & Human Biology, Elsevier, vol. 7(2), pages 153-164, July.
    13. Sabia, Joseph J. & Rees, Daniel I., 2012. "Body weight and wages: Evidence from Add Health," Economics & Human Biology, Elsevier, vol. 10(1), pages 14-19.
    14. Donal O’Neill & Olive Sweetman, 2013. "The consequences of measurement error when estimating the impact of obesity on income," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-20, December.
    15. Smith, Patricia K. & Zagorsky, Jay L., 2018. "“Do I look fat?” Self-perceived body weight and labor market outcomes," Economics & Human Biology, Elsevier, vol. 30(C), pages 48-58.
    16. von Hinke Kessler Scholder, Stephanie & Davey Smith, George & Lawlor, Debbie A. & Propper, Carol & Windmeijer, Frank, 2012. "The effect of fat mass on educational attainment: Examining the sensitivity to different identification strategies," Economics & Human Biology, Elsevier, vol. 10(4), pages 405-418.
    17. Donna Gilleskie & Euna Han & Edward Norton, 2017. "Disentangling the Contemporaneous and Dynamic Effects of Human and Health Capital on Wages over the Life Cycle," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 25, pages 350-383, April.
    18. Lucas Hafner & Harald Tauchmann & Ansgar Wübker, 2021. "Does moderate weight loss affect subjective health perception in obese individuals? Evidence from field experimental data," Empirical Economics, Springer, vol. 61(4), pages 2293-2333, October.
    19. Barban, Nicola & De Cao, Elisabetta & Oreffice, Sonia & Quintana-Domeque, Climent, 2021. "The effect of education on spousal education: A genetic approach," Labour Economics, Elsevier, vol. 71(C).
    20. Black, Nicole & Hughes, Robert & Jones, Andrew M., 2018. "The health care costs of childhood obesity in Australia: An instrumental variables approach," Economics & Human Biology, Elsevier, vol. 31(C), pages 1-13.

    More about this item

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • I1 - Health, Education, and Welfare - - Health
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J7 - Labor and Demographic Economics - - Labor Discrimination

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:28:y:2019:i:1:p:65-77. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.