TY  - JOUR
AU  - Munasinghe,Lalith
AU  - Sicherman,Nachum
TI  - Why Do Dancers Smoke? Time Preference, Occupational Choice, and Wage Growth
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 7542
PY  - 2000
Y2  - February 2000
UR  - http://www.nber.org/papers/w7542
L1  - http://www.nber.org/papers/w7542.pdf
N1  - Author contact info:
Nachum Sicherman
Graduate School of Business
Columbia University
3022 Broadway, 819 Uris
New York, NY 10027
Tel: 212/854-4464
Fax: 212/854-9895
E-Mail: nachum.sicherman@columbia.edu
AB  - Time preference is a key determinant of occupational choice and investments in human capital. Since careers are characterized by different wage growth prospects, individual discount rates play an important role in the relative valuation of jobs or occupations. We predict that individuals with lower discount rates are more likely to select into jobs or occupations with steeper wage profiles. To test this hypothesis we use smoking as an instrument for time preference. Panel data from the NLSY (1979-94) are ideal for our purposes since it contains information on smoking behavior in addition to detailed work histories and other socio-economic variables. We find that smokers have substantially flatter wage profiles, and a higher marginal rate of substitution of current wages for future wages. Incidentally, a survey of several hundred undergraduates at Barnard and Columbia College show that dance majors have the highest smoking rate.
ER  -