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Earnings and Skin Color Among Immigrants

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Shelley Batts links to an interesting study looking at skin color and wages among recent immigrants to the US. On a scale of skin color, a single point lighter was good for about a 1% increase in wages, about equivalent to the effect seen for an additional inch of height.

The statistical analysis is pretty standard; nothing atrocious pops out at me (the obvious parameters– country of origin, ability to speak English, occupation, etc– were all included in the model), though they didn’t control for IQ. But let’s assume the effect is real. The hypothesis generally mooted for the association between height or attractiveness and wages passes through some sort of personality effect– tall people are more confident, or more outgoing, or something along those lines. Is it possible there’s a similar thing going on here?

(Republished from GNXP.com by permission of author or representative)
 
• Category: Economics, Science • Tags: Economics, Pigmentation 
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  1. yes. 
     
    also, look closely at what she says about outdoor work, she says she tries to control for it, but it is a big wild card. when i’ve done fieldwork i’ve been a “5” on her skin tone (they looked at hands, exposed skin), but right now i’m a “3” since i work in an office.

  2. When there’s a r=.91 correlation between skin color and IQ at the group level, how can you discern between the two? Isn’t the study, like David Rowe said of child development studies that don’t account for heritability, like comparing two clinical trials, one with psychotherapy and drugs, and one with neither? Such a study fails to separate the two and is therefore of little value. 
     
    Note: The study I cited used the back of the upper arm, while, as Razib noted, the study listed in the post uses more exposed skin.

  3. In New York I’ve noticed that Hispanics in better paying service jobs, like door men and waiters, on average look whiter than Hispanics working in lower paying jobs. Just as attractive females have a better chance as becoming a hostess or waitress at a better restaurant, whiter looking hispanics have have more opportunities open to them in these types of jobs.  
    I don’t know how large a role this is in this study’s findings.

  4. when i’ve done fieldwork i’ve been a “5” on her skin tone (they looked at hands, exposed skin), but right now i’m a “3” since i work in an office. 
     
    yeah, but when includes an attempt at controlling for that it in the model, she finds that people likely to work outside earn more than those that likely work inside. which suggests her conclusions are conservative, no?

  5. When there’s a r=.91 correlation between skin color and IQ at the group level 
     
    but this study controls for both country of origin and ethnicity. that is, lighter skinned immigrants from, say, china, earn more than darker skinned chinese.

  6. Even though it is presented as a linear effect, there could be a threshold operating.. maybe closer to the darker end than the lighter end? Which then begs the question. Whence the threshold? 
     
    Given the 80-20 rule.. probably most of the effect is in some subset of occupations. Which ones? Things like coding ought not to matter. Probably it matters more for the more people oriented stuff (marketing, management?)

  7. Seems to me that controlling for IQ as well is crucial. 
     
    If after controlling for IQ we still get the effect, preference in this country for lighter skin (aka color prejudice) looks increasingly likely to be a least a major contributor. 
     
    If controlling for IQ does away with most of the correlation, it looks quite different.  
     
    For example the control for ethnicity is no doubt broad brush. Take Latinos aka Hispanics. Lightest skinned ones have the most European genes by and large (most pre Mariel Cubans, and a smattering of others including some from Mexico). Middle toned ones have more AmerIndian. Darkest toned ones, generally from the Caribbean (Dominican Republic, Puerto Rico, some Cubans) have substantial or even mostly African genes. So IQ would seem to likely roughly correlate shin color in this group — even before assortive mating effects kick in.  
     
    As for the later, if higher income men tend to prefer mating with lighter skinned women and tend to be better able to marry the women they want (and the preference of men around the globe for at least somewhat lighter skinned women has been frequently cited on this site) and if higher male IQ and higher male income are strongly correlated, then high IQ and light skin will tend to become more correlated in offspring over time (as well as the converse). 
     
    If one put “Asians” or even just E Asians in a single category, one might get roughly similar results, with color being a rough proxy for a substantial racial divide (at the level of 5 or 6 major races total) between NE Asians and SE Asia and Oceania.  
     
    I realize this doesn’t work with S. Asians nearly as well or perhaps at all, but they aren’t so numerous yet in this country.

  8. Something about the clip below doesn’t seem to make sense to me. 
    — 
    A possible mechanism driving the observed skin color effect may derive from differential treatment in the originating country on the basis of skin color. There is considerable support for the possibility that darker-skinned respondents faced discrimination in their originating countries. A preference for lighter skin occurs not only among blacks in the U.S., but also in India, Asia, Africa, and Central and South America. What appears to be skin color discrimination affecting immigrants to the U.S. may instead be a continuation of discrimination already experienced in their countries of birth. For that reason, those with darker skin color may have ended up with inferior marketrelated characteristics.19 If true, then a regression controlling for skin color level as well as deviation from country of birth average would show that those with darker skin color relative to their country of birth mean level have lower wages. To perform this test, I calculated a standardized deviation from country of birth means using data on all respondents with skin color reported whether employed or not.20 Inclusion of this variable in the wage equation indicates that those with darker skin color relative to the average in their country of birth actually had slightly higher, not lower, wages. The wage equation estimates continue to show the negative effect of darker skin color level on wages persisted. It is therefore unlikely that discrimination on the basis of skin color in country of birth led to lower unobserved productivity characteristics correlated with skin color that result in lower wages in the U.S. This may be the result of positive self- 19 Hersch (2006) finds that the most consistent effect of skin color among African Americans is on education, with those with lighter skin color having higher educational attainment. 20 Skin color deviation is defined as the difference between individual skin color value and the average for country of birth, divided by the standard deviation for that country. The results are similar using overall country means and standard deviations and using gender-specific deviations by country. This analysis assumes that migration is not related to skin color so that the sample of immigrants reflects a random sample of skin colors in the country of birth.

  9. also, isn’t the effect size for education rather low?

  10. Inclusion of this variable in the wage equation indicates that those with darker skin color relative to the average in their country of birth actually had slightly higher, not lower, wages. The wage equation estimates continue to show the negative effect of darker skin color level on wages persisted. 
     
    didn’t notice that. seems odd. maybe it’s because she used everyone from the country (employed or not) for the calculation of the mean, but I’m not sure how that would affect things…

  11. Take Latinos aka Hispanics … Darkest toned ones, generally from the Caribbean (Dominican Republic, Puerto Rico, some Cubans) have substantial or even mostly African genes 
     
    Some Puerto Ricans are very dark, with substantial African ancestry, but others can be so light as to be almost indistinguishable from whites. I’d hazard a guess and say that about one-quarter of the Puerto Ricans living in the New York area are mostly Caucasian. This may tie in with A.t.’s prior comment about Hispanic service workers in New York. Dominicans are darker, with a much smaller percentage appears mainly Caucasian and a much higher dark percentage (e.g. most of the Dominicans in MLB)

  12. The hypothesis generally mooted for the association between height or attractiveness and wages passes through some sort of personality effect 
     
    In northern european men iq & height are correlated, there is no doubt about this and it is likely that this extends to other in group comparisons as well…

  13. Inclusion of this variable in the wage equation indicates that those with darker skin color relative to the average in their country of birth actually had slightly higher, not lower, wages. The wage equation estimates continue to show the negative effect of darker skin color level on wages persisted. 
     
    So there were 2 variables.. one is skin color relative to country mean skin color and other is absolute skin color. The claim is that the latter effect isnt affected by inclusion of the former.

  14. Inclusion of country diluted the effect considerably as reported below.. 10% significance level for a large sample? The Height effect was quite robust comparitively. 
     
    Of particular interest are the effects of skin color and height on wages. Those with 
    darker skin color earn less, and those who are taller earn more, even controlling for 
    extensive labor market characteristics, ethnicity, race, and country of origin. The effect of 
    skin color on wages is statistically significant at the 1 percent level in columns 1 and 2 
    and indicates that an additional unit of skin color darkness on the 11-point scale lowers 
    wage by about 1.5 percent. Note that the magnitude is almost identical to but of opposite 
    sign to the effect of years of education on wages, which is measured in units similar to 
    skin color. Note also that inclusion of indicators for ethnicity and race has only a small 
    impact on the negative effect of darker skin color on wages. The inclusion of country of 
    birth in addition to ethnicity and race in column 3 reduces the skin color effect to slightly more than half the original magnitude, with the coefficient statistically significant at the 
    10 percent level in a 2-sided test. The positive effect of height on wages consistently 
    shows a wage advantage of about 1 percent with every additional inch of height, 
    significant at the 1 percent level in all specifications. 
     

  15. The Chinese thing catched my attention: Southern China (Hong Kong, Canton, Shanghai) is more developed and successful than Northern China. Southern Chinese tend to look like Phillipines, while Northern Chinese are ruddy and look Russian. Isnt something wrong here?

  16. “Isnt something wrong here?” 
     
    Only if you believe current theories of evolution are foolproof and invariable..

  17. j, 
    China started experimenting with a more capitalist and foreign investment oriented economic system in southern China, giving it a headstart. See here.  
     
    The authors of IQ & The Wealth of Nations consider economic freedom the second most attribute important to national wealth (and natural resources third).

  18. “Northern Chinese are ruddy and look Russian. Isnt something wrong here?” 
    Ruddy and Russian? Don’t tell them that; it would not make them happy. 
    I once read an autobiography by a Chinese lady who grew up in Beijing (Peking in those days) during the early 20th century. As a child, she noticed the different appearance of some southern Chinese she came into contact with, and her father told her about the dichotomy between the “high nosed” and “flat nosed” Chinese. I don’t remember what that “dichotomy” meant to them, or if a color dichotomy also came into it, except that paler skin was admired for womens’ beauty.

  19. Two Princeton researchers found that the height/wage relationship vanishes when you control for cognitive ability. They say: 
     
    “On average, taller people earn more because they are smarter.”  
     
    The (nongated) article itself:  
    http://weblamp.princeton.edu/chw/papers/Case_Paxson_Height_July2006.pdf 
     
    Tyler Cowen’s take on it:  
    http://www.marginalrevolution.com/marginalrevolution/2006/08/the_best_senten.html 
     
    So it’s not absurd to think the skin color/wage relationship vanishes when you control for cognitive ability. It’ll be interesting to see what the truth is….

  20. The truth in all probability is somewhere in between. Even with a deterministic semi genetic view of things, Im optimistic enough about human nature to think its closer to an IQ truth (related to job productivity) than an appearance truth ^__^

  21. So it’s not absurd to think the skin color/wage relationship vanishes when you control for cognitive ability. It’ll be interesting to see what the truth is…. 
     
    you have enough within family variance in skin color and IQ among south asian americans to test this. i suspect there will be still some residual effect, assortative mating between light skinned individuals and high IQ individuals can’t explain within family discrepancies.

  22. Peter 
     
    Some Puerto Ricans ? but others can be so light as to be almost indistinguishable from whites. I’d hazard a guess and say that about one-quarter of the Puerto Ricans living in the New York area are mostly Caucasian. 
     
    Yeah, I know well. I went out with one such in NYC for a while. Hot. 
     
    I was moving through the spectrum quickly, and focusing on where the quite dark skinned Latinos come from. (The fact is most American Latinos aren?t really dark skinned, including most Dominicans. In fact they often have a curiously reddish brown tint, at least in NYC.) Although you might be right about the 25% number of Ricans being as light skinned as most Europeans, I?d say well over half of NYC Puerto Ricans are as light skinned as say Sicilians or other southern Italians, which is where the vast majority of American Italians are from.

  23. re: latinos, i think there is a strong bias to note darker skinned latinos within the population. ‘white looking latinos’ don’t stand out in the ‘white ethnic’ population nearly as much.

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