Why Does Height Pay? Evidence from the Kenya Life Panel Survey

Taller people earn more, especially in low- and middle-income countries. We present among the first evidence of this phenomenon in Africa, using longitudinal microdata on a cohort of middle-aged Kenyan adults. We document a substantial height/earnings premium: controlling for gender, age, and other socio-demographics, monthly earnings increase by 1.07% per centimeter (or 2.72% per inch). Nearly half this effect can be explained by differences in cognition, measured from an unusually rich battery containing 27 modules. Additional shares of the premium can be attributed to measures of physical strength and non-cognitive ability. In contrast to prior work, we find little role for occupational sorting: conditional on cognitive and non-cognitive ability, taller people do not appear more likely to work in higher paid sectors. Leveraging repeated measures of height and an instrumental variables specification, we find suggestive evidence that measurement error may be attenuating the estimated relationship.