Discrimination based on employer preferences: The height premium in China

Abstract

This paper examines the policy issue of height-based discrimination in China's labour market using a comprehensive nationwide survey dataset spanning from 1989 to 2015. Employing a theoretical framework that considers statistical discrimination resulting from employer preferences for cognitive and non-cognitive skills associated with productivity, the research investigates the impact of height on hourly wages. The empirical analysis reveals a height premium of approximately 5.97 % per ten-centimetre increase and identifies educational attainment as a factor explaining about one-third of this premium. Furthermore, the study finds that female employees with higher education levels experience greater height premiums. Interestingly, the height premium is smaller in the public sector, senior technical occupations, in regions with a collectivist culture that centres around traditional rice-growing practices, and during the earlier transition period (before 2000) when cognitive skills held more significance. These findings suggest the widespread occurrence of height-based statistical discrimination in China’s labour market and underscore the necessity for the policy interventions of health care and nutrition intake in early life and the later effective anti-discrimination regulations in labour market.