This paper investigates whether beauty-based pay, commonly known as beauty premium, explains the disparity in average wages among male and female CEOs. We run the pay models similar to the ones used in Paul and Sahni (2016) and find that beauty premium exists for CEOs in our sample. For male CEOs, a 10% increase in beauty score is associated with a 7% increase in CEO pay. This translates to about USD 235,000 higher pay for a male CEO with a sample mean pay of USD 32.5M. For female CEOs, the same 10% increase in beauty score is associated with a 15% increase in CEO pay. This translates to about USD 75,000 higher pay for a female CEO with a sample mean pay of USD 5M. On the whole, these findings suggest that more attractive CEOs earn higher compensation and there is a substantial differential impact of beauty premium across gender.
JEL codes: G20