Deception and income: An empirical study based on height misreporting

Height misreporting, a common and intriguing phenomenon, has not been thoroughly investigated for its economic implications. This study utilizes data from the 2018 China Family Panel Studies to confirming the existence of height misreporting and empirically examine the impact of height misreporting on income. The research findings are as follows: (1) Height discrimination is the main reason for height misreporting. Height misreporting is associated with an income increase, signifying the existence of a deception premium. Simultaneously, height misreporting can partially diminish the height premium. (2) The deception premium’s psychological mechanism lies in enhanced self-confidence and risk tolerance, boosting misreporters’ income. (3) Heterogeneous analysis reveals no deception premium in knowledge-intensive industries and careers requiring official credentials. (4) Height misreporting can also mitigate various appearance premiums and have an impact on financial investment, social trust and marriage ages. This study contributes to a deeper understanding of height discrimination in the labor market and of the height misreporting phenomena, extending the application of psychology in labor signaling theory and broadening the research boundaries of behavioral economics.