Tuesday, 5 February 2013

Size Matters

The beauty of economics is that you can do research on almost anything. Among my favorites are research studies on the effects of physical characteristics. Hammermesh and Biddle (American Economic Review, 1994), for example, found that pretty people tend to have higher wages. Berggren, Jordahl and Poutvaara (Journal of Public Economics), similarly, showed that pretty politicians get more votes. And Johnston (Economic Letters, 2010), concluded that blondes not only have more fun but also get paid more (at least when they collect money for charitable causes).

Size is important as well. Tall men and women earn more, attain higher education and get promoted faster. They are happier and less likely to have a variety of psychological problems such as depression. Tall men (but not women) are more successful in the marriage market too. In a recent paper of mine (with Michèle Belot, Economics and Human Biology, 2010), we show that height helps account for asymmetries in interethnic marriages, such as the fact that black men are substantially more likely to have white spouses than black women.

Given the broad range of economists’ interests in human physiognomy, it was therefore only a matter of time until the ultimate topic would be tackled: penis size. This is exactly what a recent University of Helsinki discussion paper by Tatu Westling does. His work is, in effect, an empirical study on the determinants of economic growth. Specifically, he relates growth to a number of standard determinants of growth, such as investment in physical and human capital, population growth and political institutions, alongside the average physical endowment of the countries’ males.

The findings are perplexing. Westing finds a hump-shaped relationship between penis size and GDP per worker in 1985. In other words, economic development and prosperity seem to be associated with intermediate size: countries on either end of the size distribution tend to be poorer than those in the middle. He also finds a negative relationship between penis size and long-term economic growth (over a 25 year period, between 1960 and 1985). The latter result, however, may be driven by outliers, in particular, due to the presence of less well-endowed countries that recorded impressive rates of growth, such as Japan, Singapore and South Korea. Omitting these might make the relationship between size and growth also hump-shaped. Nevertheless, the statistical power of penis size is impressive: this variable alone explains 15% of the variation in output per worker and 20% of the variation in growth.

Now, should we take these findings seriously? Westling himself sees his work more as a methodological note than a fundamental contribution: he admits that his results are quite likely to be an example of spurious correlation or omitted variable bias. It is also unfortunate that he did not replicate his analysis with different periods, to see how stable these relationships are. Nevertheless, Westling does suggest a plausible explanation for the observed links: penis size is related to testosterone levels, which also determine risk-taking behavior in men. The latter has important implications for productivity, from health and safety during work or leisure to investment decisions. The hump-shaped relationship between output per worker and penis size might therefore indicate that there is an optimal degree of risk taking: too much or too little translate to less economic development. It would also suggest that differences in attitudes to risk among countries are not necessarily driven by culture but should perhaps be rather attributed to genes or differences in diets.

In other words, further research may be required to put this matter to rest.

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