Dress for Success - Does Primping Pay?

Abstract:     
A unique survey of Shanghai residents in 1996 that combined labor-market information, appraisals of respondents' beauty, and household expenditures allows us to examine the relative magnitudes of the investment and consumption components of women's spending on beauty-enhancing goods and services. We find that beauty raises women's earnings (and to a lesser extent, men's) adjusted for a wide range of controls. Additional spending on clothing and cosmetics has a generally positive but decreasing marginal impact on a woman's perceived beauty. The relative sizes of these effects demonstrate that such purchases pay back at most 10 percent of each unit of expenditure in the form of higher earnings. Most such spending represents consumption.

JEL Classifications: J19, J70

Working Paper Series