Beauty and brains

It is well known that beautiful people earn more, which goes some way to explaining Matt Nolan’s success in his stage career. What is apparently more difficult to understand is why they earn more. A paper tries to split out two effects: productivity and discrimination. For instance,

…lecturers who are viewed as better looking receive higher instructional ratings by their students. Then, ceteris paribus, these higher ratings translate into higher salaries, because US university administrators pay attention also to teaching quality in setting salaries. However, the question remains on whether students are simply discriminating against ugly professors by reacting to an irrelevant characteristic, or if they do really learn less from them.

The researchers find that the additional wages of lecturers are due to productivity gains rather than discrimination but what confuses me is the difference between the two! The wording implies that productivity gains are independent of discrimination when, really, it is just a different form. What the authors refer to as ‘discrimination’ is Becker’s model of tastes for good looks. That would involve the employer paying an employee more because they, perhaps erroneously, believe that good looking people are better employees.

What the authors refer to as ‘increased productivity’ is the additional payment to lecturers for better educating students. But let us ask WHY the students achieve better outcomes with more beautiful lecturers. It is likely to be because they pay more attention to, and have more trust in, beautiful people. That causes them to learn more effectively when being taught by good looking lecturers. Is the students’ belief any more rational than an employer’s belief that beautiful people are more skilled? Of course not: the ‘productivity’ effect described here is merely discrimination by the consumer, rather than discrimination by the employer. The results in the paper show that discrimination by employers in this case is an indirect effect caused by consumer discrimination on the basis of looks.

To be clear, I’m not suggesting that the authors are in any way incorrect to separate the two effects but the terminology they use is somewhat misleading. This is not evidence that beautiful people are more skilled than the rest of the population: it is evidence that there are many ways in which beautiful people benefit from their good looks. Just because the interviewer can see past Matt’s smouldering good looks doesn’t mean he won’t end up earning more than the rest of us 😉

[NB. The ‘Matt Nolan’ referred to in this blog post is not the New Zealand economist of the same name. Any confusion is entirely intentional.]