Table 10.
Reverse Simulation: Effects of Attenuation Bias on the Magnitude and Significance of Attractiveness Coefficients
| Correlation in Attractiveness (1957–1992) | Average Coefficient | Coefficient Range | Percentage Significant at 10% Level | Percentage Significant at 5% Level |
|---|---|---|---|---|
| 0.25 | 0.015 | −0.041–0.072 | 30.09% | 19.98% |
| 0.40 | 0.025 | −0.031–0.081 | 57.41% | 44.42% |
| 0.63 | 0.040 | −0.012–0.094 | 91.85% | 85.25% |
| 0.87 | 0.057 | 0.012–0.103 | 99.89% | 99.61% |
| 1 | 0.067 | 0.025–0.114 | 100.00% | 100.00% |
The dependent variable is hypothetical 1992 earnings that on average exhibit a 6.7% attractiveness premium. The first column reports the assumed correlation between high school and adult attractiveness. The empirical models use the long set of covariates. For each row, the statistics are calculated from 100,000 iterations.