Skip to content

Research Paper University of L√ľneburg Working Paper Series in Economics 96

The smoking wage penalty in the United Kingdom: regression and matching evidence from the British Household Panel Survey

Authors

Publication date

01 Aug 2008

Abstract

This paper considers the impact of tobacco consumption on wages in the UK using data from fifteen waves of the British Household Panel Survey. Considering both overall smoker status as well as the number of cigarettes consumed, we provide estimates for the smoking wage penalty using standard regression methods, including panel estimators for fixed effects and panel instrumental variable estimators. Furthermore, we analyse the impact of stopping and starting to smoke relative to permanent smokers and non-smokers by Mahalanobis-matching. In the cross-section, we find a rather large wage penalty for smokers of about 4%. However, panel estimator and IV results show relatively few support for hypotheses linking the smoking wage penalty to either lower productivity of smokers, be it health related or not, or discrimination. Matching results suggest that starting or stopping to smoke does not affect later earnings relative to remaining either smoker or non-smoker.

Subjects

Wages And Earnings and Health

Links

http://econpapers.repec.org/paper/luewpaper/96.htm

Notes

Econpapers search; working paper

#511717


Research home

Research home

News

Latest findings, new research

Publications search

Search all research by subject and author

Podcasts

Researchers discuss their findings and what they mean for society

Projects

Background and context, methods and data, aims and outputs

Events

Conferences, seminars and workshops

Survey methodology

Specialist research, practice and study

Taking the long view

ISER's annual report

Themes

Key research themes and areas of interest