%0 Report
        %A Heineck, Guido
%A Schwarze, Johannes
        %T Substance Use and Earnings: The Case of Smokers in Germany
        %D 2003
        %8 2003 Mar
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 743
        %U https://www.iza.org/publications/dp743
        %X This paper examines the effect of smoking behavior on earnings. Using data from the
GSOEP, both cross-sectional and longitudinal models are estimated separately for males
and females. Results for the cross-sectional models confirm prior analyses inasmuch as
smoking has a negative effect on earnings for males. However, applying fixed-effects
estimation, this effect is found to be inverted for men aged 25 to 35 years compared to their
non-smoking counterparts. That is, controlling for unobservable individual heterogeneity, the
result implies that male smokers are individuals with higher time preference rates. At the
early stage of the age-earnings course higher earnings are therefore found for smokers
because young male non-smokers only are about to start off their occupational career.
Women’s earnings, however, are not affected by smoking behavior.
        %K smoking
%K earnings regressions