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Returns to Testosterone Across Men's Earnings Distribution in the UK

Author

Listed:
  • Eibich, Peter

    (PSL Université Paris Dauphine)

  • Kanabar, Ricky

    (University of Bath)

  • Plum, Alexander T.

    (Auckland University of Technology)

Abstract

We study how population variation in testosterone levels impacts male labour market earnings using data from the UK Household Longitudinal Study between 2011 and 2013. We exploit genetic variation between individuals as instrumental variables following a Mendelian Randomization approach to address the endogeneity of testosterone levels. Our findings show that higher testosterone levels have a strong positive impact on earnings. Importantly, these findings are limited to men belonging to the lower quartile of the testosterone distribution and working in higher-paid jobs. We show that differences within rather than between occupations drive these findings, whereas we find limited support for selection into occupation or mechanisms involving individual characteristics, including personality traits and education.

Suggested Citation

  • Eibich, Peter & Kanabar, Ricky & Plum, Alexander T., 2025. "Returns to Testosterone Across Men's Earnings Distribution in the UK," IZA Discussion Papers 17699, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp17699
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    References listed on IDEAS

    as
    1. Angrist, Joshua & Kolesár, Michal, 2024. "One instrument to rule them all: The bias and coverage of just-ID IV," Journal of Econometrics, Elsevier, vol. 240(2).
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    More about this item

    Keywords

    earnings; IV; testosterone; Mendelian Randomisation;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • I10 - Health, Education, and Welfare - - Health - - - General

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