Beiträge zur Jahrestagung des Vereins für Socialpolitik 2015: Ökonomische Entwicklung - Theorie und Politik - Session: Labor Supply B18-V2
The positive correlation between hourly wages and height, which results in higher labor supply of tall individuals, is well-documented in the literature. This paper introduces two additional channels through which height might affect individual labor supply. Higher caloric needs of tall individuals should result in higher consumption expenditures for food and in an increased labor supply. Size specific products should result in lower product variety and a higher price level for sizes where aggregate demand is low - typically sizes for individuals in the tails of the height distribution - and in lower labor supply of individuals facing low product choice. Introducing these two channels into a household's maximization problem we derive a labor supply equation that allows for an empirical test for the relevance of these two channels. We use the German Socio-Economic Panel Study to estimate this labor supply equation. Caloric needs do not seem to have a significant effect on labor supply. Product choice, on the other hand, does increase labor supply significantly.