Daniel Hamermesh

Although 30 years ago college students may have paid their tuition by working part time, summer or minimum wage jobs, today it’s impossible, according to economics professor Daniel Hamermesh.

Hamermesh said in addition to a drop in government assistance for higher education, the cost of labor is also a factor in the rising cost of tuition. Hamermesh said minimum wage, currently $7.25 per hour, has not risen to catch up.

“Education is a very labor-intensive industry — it’s hard to substitute machinery for professors or teachers,” Hamermesh said. “That means that, as the cost of labor has risen, the costs have to get passed on in the price — in tuition.”

Linda Morgan, student employment supervisor at Hire a Longhorn Job Bank, said the amount earned from working roughly 30 hours per week at a minimum wage job would fall short of the amount needed to pay the tuition bill of a Texas resident enrolled in 12 credit hours.

“For many years, we have known that about 75 percent of students work while pursuing their degree,” Morgan said. “What is less certain is whether they are able to pay all their college expenses through work alone.”

Undeclared freshman Marlene Macias said she works as a cashier at Kin’s Market and at Whataburger to pay for what financial aid doesn’t already cover: food, living expenses, gas and spending money.

“I have an older sister who is a junior at UT, a 14-year-old brother and a 5-year-old brother,” Macias said. “My parents cannot afford to support two kids in college, so my sister and I both got jobs to pay for what financial aid can’t help us with.

Radio-television-film freshman Chanelle Gibson said she works as a student assistant at Kinsolving Dining Hall to help pay for out-of-state tuition. According to Gibson, she hasn’t been able to help pay significantly for college through her job.

“It is slowly adding up, though, and working full time this summer at Sonic will also help me start moving toward actually being able to make a dent in my tuition,” Gibson said.

Macias said she feels anxiety about debt after college all the time, but she said having a UT diploma will pay off in the long run.

“Even with two jobs and financial aid, there is no way I will leave debt free,” Macias said.

Gibson, whose parents refused to allow her to take out student loans — insisting on paying for her education themselves — said she doesn’t want to feel like a financial burden on her family.

“I have anxieties about my parents paying for my college,” Gibson said. “When I was deciding where to go, they basically said to me, ‘You just pick your dream school and we will find a way to pay for you to go there.’” 

Photo Credit: Caleb Kuntz | Daily Texan Staff

Ongoing budget cuts are taking their toll on UT researchers and students in the form of grant cancellations, delayed projects and diminished assistance from federal agencies.

The government shutdown earlier this fall caused UT researchers to miss important grant-submission deadlines and slowed the grant processing procedure, but John DiGiovanni, a cancer researcher and pharmacy and nutritional sciences professor, said these troubles are just the tip of the iceberg. 

Federal funding for research grants has been on the decline, and automatic federal budget cuts — known as sequestration — have exacerbated the trend. For example, the National Science Foundation will accept nearly 1,000 fewer grant applications for this fiscal year. In addition, the National Institutes of Health will be forced to cut its 2013 fiscal year budget by 5 percent — or $1.55 billion. 

“The meeting of the grant review panel that I serve on for the NIH has been cancelled,” DiGiovanni said. “On top of that, we’ve seen delays in funding for grants.”

President William Powers Jr., who is the newly elected chairman of the Association of American Universities — a consortium of 62 public and private research universities — traveled to Washington D.C. early this November to speak with legislators and voice his concerns over the cuts, which, he said, impede students’ abilities to be a part of research that could change the world.

But it’s not only the federal grant budget that is under review, according to economics professor Daniel Hamermesh. The budgets of administrative agencies, including the Environmental Protection Agency and the Department of Education, are seeing substantial cuts. Cuts to these agencies’ budgets hamper their ability to collect raw data that UT researchers rely on, Hamermesh said. 

“More funding is better, and these fields [the social sciences] are not highly paid,” Hamermesh said. “But what’s worse is killing important data sets.” 

The decline of federal funding for basic research is not a new phenomenon. Historically, government dollars accounted for a majority of those spent on science research in the United States, but that trend has reversed of late, with private and corporate research funding taking precedence. 

Though researchers have lost the security of federal grants, some students, such as engineering sophomore Katherine Magee, see opportunities in growing private funding for research. “Government grants are certainly important in building the University, but so much of the research we have access to is in the private sector,” Magee said. “So for me, that private funding for research is almost more important than government grants.”

Establishing close professional relationships with educators can be the most beneficial part of attending a university. It is the risk of losing these opportunities that initially made me wary of blind grading systems, such as the one proposed by UT economics professor Daniel Hamermesh.

The idea comes from a study Hamermesh, along with researchers Jan Feld and Nicolas Salamanca from Maastricht University in the Netherlands, co-authored and released earlier this month. That study presented the novel idea that favoritism in the classroom and workplace can cause greater inequity than overt discrimination. The study defined favoritism as “display of a significantly positive response toward those of similar characteristics to oneself.”

For the experiment, a large number of students were given an exam at Maastricht University in the Netherlands. Some were asked to put their names on the exam, giving away clues as to their nationality and gender, while others wrote down ID numbers. The similarities between four groups of test takers and graders was taken note of: Gender matched between students and graders, gender unmatched, nationality matched between students and graders and nationality unmatched. Ultimately, the researchers found that students whose tests were graded by scorers of the same nationality received significantly better grades than those who were unmatched. 

The definition of favoritism offered by the study isn’t the only definition of that word, and one experiment conducted in Europe doesn’t affirm that a problem exists here in Austin. But the results of the study may still have implications for how we grade students here at UT. 

For example, If an exemplary student does poorly on one assignment, but has a good track record with the teacher, it wouldn’t be unreasonable to suggest that the teacher may give the student a higher grade than deserved. Instead of focusing on the individual quality of the sole assignment, the teacher could unconsciously rely on his overall impression of the student. 

Considering the University already has ID numbers (EIDs) to track students, having students provide only these on tests and assignments would not require an overhaul of the grading system. Hamermesh mentioned that most law schools in the United States already implement a blind grading strategy, in which a student is a number rather than a name.

At the same time, a blind system may come into conflict when applied to smaller, more intimate classroom settings by disrupting the personalized feedback that is an integral part of such courses.

Joe Capraro, a graduate teaching assistant in the School of Communication, said, “Knowing each student’s individual strengths and weaknesses — which as an instructor I spend the semester doing and adjusting to — adds to [the feedback process]. If I know student #1283 is Jane, I can help her better.”

There may be a solution that meets in the middle. To satisfy the fairness criteria of a blind system, students would put numbers instead of names on their assignments to make the scoring process as neutral as possible. The professor would focus solely on the quality of the work, allowing them to consider it free of bias or personal attachments. To preserve the benefits of professors being familiar with a student’s work, feedback would still be offered throughout the semester. The professor could ask for an email attachment to match the paper with the name of the student after the grading was over, a strategy that Capraro mentioned one of his own professors employed.

For classes with exams, a blind system focused specifically on the grading process sounds like an idea that would be simple to implement and have few negative consequences. As Hamermesh said, “We want to put the world on as neutral of footing as possible.”

Manescu is a journalism and international relations junior from Ploiesti, Romania.

If Congress does not raise the debt ceiling by Thursday, the U.S. will default on its debt.

But what does this mean? It means that U.S. federal law says that there is an upper limit to the government’s debt beyond which the government has to stop borrowing. If the government can no longer borrow, it will not be able to pay off its obligations, and the bonds and notes the government issues will go into default.

Yes — the U.S. has already reached its current debt limit. The U.S. reached the current debt limit of $16.699 trillion this past May, but has had sufficient funds to continue to pay its bills. But according to the Obama administration, if the debt ceiling is not raised, and thus the U.S. government cannot borrow more funds, the government will run out of money on Oct. 17. At this point, it will no longer be able to pay it for its outlays, triggering a default.

How did the debt ceiling come about? Surprisingly, there is nothing about a debt ceiling in the Constitution. Rather, Congress and the President created it in 1917 with the passing of the Second Liberty Act. Since then, Congress has been continually raising the ceiling. In fact, it has done so 74 times in the last 51 years, according to the Congressional Research Service, making the ceiling almost arbitrary. But this year, a standoff in Congress has changed the situation. Congressional leaders have been using the threat of a government default as a bargaining tool.

But if it’s not in the Constitution, why on earth does the debt ceiling exist?

In the words of Dr. Daniel Hamermesh, the Sue Killam Professor in the Foundation of Economics at the University of Texas at Austin, “The debt ceiling is a self-inflicted wound that the legislature and the president tied their hands with. No other country does this... It has become a bargaining tool, although in a better world, we shouldn’t have this.”

So this year, what exactly is being bargained for or against? And why hasn’t Congress raised the ceiling already?

At the most basic level, the fight this year is over the Affordable Care Act, or Obamacare, a health care platform that House Republicans have tried to repeal or undermine at least 42 times, according to CNN. Now, members of the Tea Party, or right-wing Republicans, have decided to use the threat of a looming default to try to defund the Affordable Care Act, or Obamacare. This is no secret agenda. In fact, one of the most vocal advocates of this strategy, Senator Ted Cruz, is a junior U.S. Senator from Texas.

What’s at stake? What happens if the U.S. defaults on its debt?

Honestly, no one knows. A U.S. default is unprecedented. While other countries — such as Argentina, Venezuela, Ecuador, and Belize — have found themselves in sovereign default, none of these nations’ currencies serve as the world’s benchmark currency the way the U.S. dollar does. Usually, during economic turmoil, investors buy what they U.S. Treasury bonds, seeing them as one of the safest investments. In this scenario, when the U.S. government’s sovereignty itself is at risk, it’s unclear what the global investment community will do.

Will investors continue to buy U.S. bonds? Will they move to a portfolio of currencies? One person’s guess is as good as any other’s. In either situation, though, the confidence of the people buying U.S. debt — individuals, institutional investors, large banks, and foreign governments such as China and Japan — will be shattered. And this diminishing confidence level will be the most detrimental effect of the default, much larger than the practical considerations of the government not being able to pay its bills.

Hamermesh agreed, saying that this crisis is slowly destroying the perception of the U.S. as the most stable place to put money. Interest rates will go up as well, and the increased uncertainty will cause investors to move their money out of the country.

As for the effects on UT, they would trickle down effect would harm funding. In truth though, if such a thing did occur, the big picture implication would be so catastrophic that it’s even hard to speculate specific effects on UT. And the longer this fight goes on in Congress, the more detrimental the effects will be.

Recently, there have been a number of stories in the media about an avenue President Obama could take to sidestep the Congress and resolve this crisis. Section four of the 14th Amendment of the U.S. constitution says the following: “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”

To Hamermesh’s eyes, this passage provides the grounds for Obama telling Congress, “the debt should not be questioned, I’m not going to let it be questioned. Therefore we are going to keep on writing checks.” A move that would in effect “leave Ted Cruz stomping up and down and crying.” 

Other academics are not so certain that the solution is clear. Dr. Jack M Balkin, the Knight Professor of Constitutional Law and the First Amendment at Yale Law School, says on his blog that “the President does not have the unilateral power under Section four to disregard the debt ceiling.” 

Balkin believes that the President needs Congressional authorization to do so. If he sidesteps the Congress, it’s likely he could be tried for impeachment. The Obama administration has also officially stated that the President does not have the power to end the crisis under the 14th Amendment.

So where does this leave us?

Our country is on the brink of unprecedented economic collapse in large part due to partisan politics. And yet, behind all the bickering, there is a vague certainty that the U.S. cannot default; that the government won’t. This sentiment seems reminiscent of the one held by numerous large institutions during the mortgage crisis years ago. But the truth is, no country is too big to fail, not even the world’s largest superpower. And we, as a country, need to realize this in order to uphold our esteemed status in the global community.

Should we as students at UT care? In the words of Dr. Hamermesh, if we are citizens of the U.S., and if we want to continue to live in a country that is viewed as the best in the world, we should certainty care. And one of the first steps to caring is to educate ourselves on what’s going on.

Malik is a Plan II and business honors sophomore from Austin.

Economics professor Daniel Hamermesh co-authored a research study detailing the affects of favoritism in the workplace.  The study, published by the National Bureau of Economic Research, reveals that endophilia yields more problems with inequality than discrimination.

Photo Credit: Jarrid Denman | Daily Texan Staff

Favoritism, as opposed to discrimination, contributes to a greater level of inequity within a school or workplace, according to a study co-authored by economics professor Daniel Hamermesh.

Maastricht University economists Jan Feld and Nicolas Salamanca also co-authored the research, which was released on Oct. 7. Favoritism is a display of a significantly positive response toward those of similar characteristics to oneself, while discrimination is a display of harmful treatment toward those of dissimilar characteristics. 

The study focused on an experiment in which the researchers issued an exam to a large number of students at Maastricht University. The researchers asked a randomly selected group of students to put their names on the exam, which allowed the graders to infer nationality and gender, Hamermesh said. They asked the rest to only put ID numbers. The three researchers then investigated four groups of test takers: gender matched between students and graders, gender unmatched, nationality matched between students and graders and nationality unmatched.

The findings indicated that the groups of students matched with graders by nationality received significantly better grades than those who were unmatched. 

Hamermesh said he believes there should be a system in place at UT that ensures tests on campus do not expose the names of students.

“In classes where graders can see who the students are, the chance for unfairness is much greater,” Hamermesh said. “I would argue that all tests at our university should be blind. If the majority is favored, we need to tell them they are no different than the minority, and we need to tell employers to stop favoring the majority.” 

The results of the experiment indicated gender, whether matched or unmatched, did not make a difference in the grades issued to the students. Additionally, unmatched nationalities did not affect the grades of the students. 

Business honors freshman Katie Stephens said she is interested in the atypical focus of the study toward favoritism.

“Favoritism does not possess the same negative social stigma as does discrimination,” Stephens said. “Therefore, it is often overlooked by those not experiencing the harmful side effects or those in a higher position with the ability to prevent it.”

The researchers said not enough study has been devoted to the outcome of favoritism as opposed to discrimination. They further proposed that the inequity displayed within the grading system of school settings will also exist in the labor market. 

Human development freshman Neil Doughty said he was not aware of the effect of favoritism in a grading situation and appreciates the information put forward by the research.

“Honestly, the results [of the study] surprise me,” Doughty said. “I would have assumed the opposite. As a student, I don’t want to be evaluated on a different scale than other students, and research like this helps work to fight that issue from arising.”

Photo Credit: Jorge Corona | Daily Texan Staff

Editor’s note: Names of some individuals in this story have been altered. A few interviews were conducted in Spanish and then translated into English.

For all the years Maria Batarse has put in at the University, an opportunity to retire appears nowhere in sight.

Batarse, an undocumented worker, came to the U.S. in 1988 and works at one of UT’s on-campus dining halls, which one of the University’s subcontractors manages. 

“I’ve been here for a long time,” Batarse said. “I bought a house on the south side 15 years ago. I’ve finished paying it off. I have my kids and everything — they’re all grown up. And I see them struggling, right? Financially, sometimes … and then I think: How I am going to retire? I feel so powerless because I have money saved for my later days but can’t access it, and it’s so unjust for me to burden [my kids] when they are barely starting their lives.” 

In 1986, Congress passed the Immigration Reform and Control Act. One aspect of the bill opened the door for the Social Security Administration to transfer fake Social Security credits to a legal account. 

Many undocumented workers obtain employment using fake Social Security cards, and thus pay Social Security as well as Medicare taxes. But unlike everyone else, they do not receive those benefits once they retire. Instead, the money undocumented workers pay goes into the Earnings Suspense File, a special account where unmatched Social Security funds are held, which is then distributed to all other Social Security recipients. 

The file receives between $7 billion and $11 billion per year in Social Security taxes, and it is estimated that almost 75 percent of that amount comes from undocumented workers. 

“We all pay Social Security taxes and our employers pay the same amount we pay for us,” economics professor Daniel Hamermesh said. “For these people, the money that is paid by them never goes to an account that will provide them with benefits. If [undocumented workers] became legalized, as they would under the Obama plan, there is no question that some of that earning suspense money would go for establishing credit for the newly legalized workers, and I am all in favor for that.”

Most of the undocumented immigrants in the U.S. work in the construction, service, agricultural and food and drink industries. According to the Department of Homeland Security, there were about 1.8 million undocumented immigrants in Texas in 2010, which made up about 16 percent of the population nationwide.

When it comes to hiring cheap labor, higher education is not an exception. UT’s undocumented workers vary from service clerks, repairmen, gardeners, construction workers, plumbers and electricians that work unlawfully so they can provide for their families. 

Alfredo Moreno is one of those workers; he has worked for UT for more than 13 years, although he first came to the U.S. in 1997 from Zacatecas, Mexico. During his first few years in the U.S., Moreno worked odd jobs in the San Marcos area before moving to Austin in 2000 after he had saved enough money to bring his family to the U.S. 

“When my family came, I saw my son again. [He was a] 6-year-old kid when he got here, 3 when I left — he hardly recognized me,” Moreno said. “I told [him] he had to start going to school even if he didn’t understand a word from the teacher — I told him to try hard. It was tough, tough times.”

Moreno’s son, Emilio, will graduate from Elgin High School in May. Emilio is in the top 10 percent of his class and plans to attend UT to study astronomy. 

If Emilio had graduated last year, he would have also had to obtain a fake Social Security number — like his father — to be able to get a job while in college. Those measures are no longer necessary after President Obama enacted the Deferred Action for Childhood Arrivals program in June, which allows, among other provisions, for immigrants over the age of 18 who were brought illegally as children to qualify for temporary-work permits and thus receive Social Security cards.

Law professor Barbara Hines, co-director of the school’s immigration clinic, said she agrees with the notion that those who pay into the system should be able to get something out of it.

“That money belongs to the workers,” Hines said. “It was taken out of their checks and I believe they are entitled to it.”

Hines said the process of obtaining citizenship is not as easy as people make it out to be.

“It’s not simply getting in line as people are talking about it,” she said. “Depending on where you come from, the line can take years. For instance, if you were born in Mexico and are over 21, the average wait for you is 10 years to get a green card. The U.S. government gives 20,000 legal visas for Mexico, for instance. As you can imagine, they run out of them every year.”

Some lobbying groups, such as the Senior Citizens League and the Federation for American Immigration Reform, have stressed the danger that immigrants pose to the Social Security Trust Fund if immigrants are able to collect benefits. Hamermesh said the concern is overblown.

“It’s a lot of money but the program is so big and the solutions so easy that is just not a real biggie,” he said. “A lot of people think [the Social Security System is] going to be broke next year; that’s BS — that ain’t gonna happen. It is going to break in about 20 years but that is so much time, it is so easy to fix that; I am quite sure we will. I am an optimist about this country. I think when there is a real problem we do get our act together.”

Batarse, who came to the U.S. from Santa Rosa, Guatemala, is nearing retirement age. She said she likes where she works, but her future is uncertain.

“Overall I can’t complain. I’m happy to be here,” Batarse said. “But the work is really getting to me. When will I be able to stop working? Every check, I have been paying for my retirement. I file my taxes, like anyone else. I don’t think it’s fair, and it’s not just me who has this problem.”

Published on February 20, 2013 as "The matter at hand". 

In his research, economics professor Daniel Hamermesh takes a closer look at the “faceless consumer,” examining what people do with their free time and how beauty impacts economic success. Hamermesh, an expert in labor economics, is widely quoted by major publications like The New York Times and has appeared on national television programs several times. He is the author of “Beauty Pays: Why Attractive People Are More Successful,” a book about how looks influence economic success, and his most recent research looks at how people choose to spend their free time when their work hours are cut.

The Daily Texan recently spoke with Hamermesh about his research and how he thinks Americans should budget their work and free time.

The Daily Texan: So, why did you get interested in how people use their free time outside of work?
Daniel Hamermesh:
The way I see it, economists have viewed sex and changing diapers identically in the past. They have concentrated mostly on “work” or “not work,” and yet “not work” consists of a whole bunch of different things.

Our research, which uses data from Korea and Japan, tries to answer the question, “If we didn’t have to work so much, what would we do with our time?” A number of economists think that people would do work-like activities at home, yet this research shows very clearly that when people didn’t have to work so much, they engaged in either leisure or personal care, which means grooming, taking care of themselves, et cetera. I think it’s a very important finding and quite unique in that it had never been looked at before.

DT: Reading about your research, it seemed like there was a wide array of activities that were considered leisure activities. Were there certain leisure activities that people favored doing with their new free time?
In Japan, we found that the main thing done with the free time was watch television. People used about half of their free time, because they weren’t working as much, to watch more TV.

DT: How much of this do you think is culture-specific and how much is generalizable? If workers in the United States got more free time, would they spend it watching TV or would they engage in different leisure activities?
That, I don’t know. One can always argue with a study that is specific to a country and a time that things could be different elsewhere at other times. But, in some ways, I think we’d see more of this, since Americans are working very hard now. My guess is that, if they were freed up, Americans would not be spending more time walking the dog, painting the house or taking care of kids.

DT: Why are people choosing to relax with this new time instead of doing other productive things?
Because it’s fun. We Americans are crazy. We work much harder for pay than any other rich country. Even the Japanese don’t work as hard as we do now. And the Europeans countries... it’s just remarkable how much vacation they get. In America, I think we’d certainly work less given the chance. We simply can’t get our act together to agree to work less. I’d love to see America require companies to give four weeks of vacation to everybody.

DT: Do you think that will happen anytime soon?
Well I’m 68, and I’d be very surprised if it happened in my lifetime. I hope it will happen in yours because I think it would make for a much saner society.

DT: Would cutting time off the work week hurt our productivity as a nation?
Obviously, if we weren’t working as long, we wouldn’t produce as much, but remember, the goal of society is not to produce more things but to be happier, and I’m quite convinced that, if we could agree to do this, we could be happier.

DT: Switching to another area of research: Obviously, some people who are unattractive still become very successful. How do they overcome the disadvantages of their looks?
The same way I’ve overcome the disadvantage of my terrible voice and my inability to sing. You stress those things that you’re good at. Looks aren’t the only thing that matter for success by any means, and a smart person always stresses the things he or she is good at and downplays the things that he or she is bad at.

DT: So, there is this inequity in society ... Is that the fault of employers being discriminatory or is it because of our general attitude as a society?
The second. Employers are essentially just agents doing what maximizes their profits, and their profits are maximized because you, me and everybody else wants to buy from, look at and work next to a good looking person. The fault is all of ours. That’s quite clear.

A new book authored by UT economics professor Daniel Hammermesh argues attractive people earn between five and 12 percent more than their less attractive co-workers. (Photo Illustration)

Photo Credit: Thomas Allison | Daily Texan Staff

UT students may need more than just a degree to be successful in the workplace, according to a recently published book by a UT professor.

Beauty Pays, released on Monday and authored by economics professor Daniel Hamermesh, is a study on the effect of a person’s physical appearance in the workplace. According to the book, after adjusting for educational differences, beautiful people make 5 percent more money than their average looking coworkers and are likely to make between 10 and 12 percent more than their worst looking coworkers.

Hamermesh saw another project on the subject 20 years ago and was inspired to pursue serious economic research on the topic, he said.

“The book notes that beauty is inherently scarce and is thus a fit topic for thinking economically since economics deal with scarcity,” he said.

After writing seven scholarly papers on the subject, Hamermesh said he felt it was time to make his research public. The book also contains the research of many other economists who have done work in the area, he said.

The book uses ratings from interviewers or from pictures to determine who is or isn’t beautiful, Hamermesh said. While the rating of beauty is largely subjective, most people tend to view other’s looks in a similar way, he said.

“If you think somebody is good looking, the odds are that most other people will feel the same way about him or her,” Hamermesh said. “If you think a person is ugly, most onlookers would agree.”

The book discusses why beauty affects how well we do in the work place and in other parts of life, what “beauty” means in the workplace, how each sex is affected, whether the trend is a form of discrimination and other factors related to the issue.

“Beauty affects outcomes on jobs, in dating and marriage, and in lending — essentially in any market,” he said. “It affects how happy we are, too.”

Biology freshman Stephanie Jacobs said she thinks beautiful people may have better luck getting hired for certain jobs because they seem more confident.

“People like to see perfection,” she said. “It could make bosses feel as though certain candidates will have a more successful time in the workplace.”

Although Jacobs said she does not think this is fair, those who are not viewed as beautiful should use other resources available to them so they can help narrow the gap in success, she said.

A beautiful appearance does provide an advantage over less attractive people when getting hired, while in the workplace and in other parts of life, said radio-television-film sophomore Areli Casiano.

“Success should be determined by the potential people have,” Casiano said. “A person has a lot more than their appearance.”

An estimated $8 million dollars is circulating through Austin because of Texas Relays, said city officials.

The Texas Relays, an annual series of races held throughout the city, generates revenue in the hospitality industry each year. Students from high school, UT and other colleges participate in the event.

The relays brought an estimated 40,000 people to Austin this year, said Rebecca Martin, senior vice president of marketing at the Austin Chamber of Commerce.

Hotels, restaurants, taxis, Capitol Metro and Sixth Street probably took in much of the revenue, she said.

“Everything that is affiliated with the hospitality industry is affected,” she said.
The impact comes from visitors who come in and spend their money, said economics professor Daniel Hamermesh. He estimated after the $8 million circulates through the Austin economy, businesses could have enough money to create or sustain approximately 300 jobs.

“That may be a high estimate; it’s very iffy,” he said. “I don’t think the effects are very big. We’re not talking Super Bowl are we? But it still helps. It’s small potatoes, but it’s something.”

The Super Bowl was expected to bring in 150,000 visitors and generate $611 million for establishments in the Dallas-Fort Worth area.

Texas Relays is a very profitable weekend for the hospitality industry, said Theresa McCarthy, general manager of the North Austin Drury Inn & Suites on Interstate Highway 35. But serving the extra amount of people is labor intensive and costs are high, she said.

“It’s a good weekend for us,” she said. “It’s crazy busy, and we’re all brain dead from the stress of it, but it’s good.”

The relays compare with the Republic of Texas Biker Rally — an annual motorcycle parade in downtown Austin — and UIL high school men’s and women’s basketball championships in size and impact, McCarthy said. The Drury served 600 people two meals per day, raising its food costs and increasing staffing throughout the hotel to accommodate the high volume of guests staying for the event, she said.

The Drury removes most discounts during special events, including lower weekend rates that occur during slower times, McCarthy said. Other hotels often increase to a “special events” rate that is much higher than standard rates, she said.

“Were the relays to move out of Austin, it would require us to re-evaluate our budgets and most likely project less revenue for the month,” she said. “As for the overall revenue to the city, I’m not sure that the restaurants and stores or hotels could make up for that lost revenue without bringing in another citywide event to replace it.”

Beauty may be more than skin-deep, according to a recent study finding that attractive people are also happier than their homelier peers.

Attractive individuals are generally happier than their less-attractive counterparts in large part because of economic benefits resulting from their good looks, according to a research analysis two University economics professors released Monday.

The top-15 percent of good-looking people are more than 10 percent happier than those ranked in the bottom 10 percent of looks, according to a study conducted by Jason Abrevaya and Daniel Hamermesh, the latter of whom is also a women’s and gender studies professor. Hamermesh said the results of the research comparison, published on the Germany-based Institute for the Study of Labor’s website, should not be overestimated.

“It is important to know the size of the effect, that it’s there — not tiny but not huge,” he said. “This should make less-than-good-looking people feel better about themselves — be happier.”

Hamermesh and Abrevaya analyzed five studies involving more than 25,000 people in the U.S., Canada, Germany and the U.K. Interviewers asked participants about their overall life satisfaction and rated participants’ attractiveness. Hamermesh said the subjective nature of interviewers’ rankings of participants’ attractiveness is not a problem.

“Of course, beauty is subjective, but people tend to agree on who’s good-looking and who isn’t,” he said.

Economic benefits that come with beauty — such higher salaries, better-looking spouses with higher salaries and better terms on loans — account for the majority of this effect, according to the study.

The total effects of beauty on happiness were similar for men and women. The direct effect of beauty was larger in women, accounting for 50 percent of their increased happiness, while the direct impact was less than one-third for men.

“People just feel better about things knowing they’re good looking, independent of any effects on wages, markets and other such effects,”
Hamermesh said.

Psychology graduate student Jessica Jankowitsch said she works at UT’s Langlois Social Development Lab on research about how people begin to form stereotypes about attractive people beginning in infancy.

“Even at a very young age, infants prefer attractive faces,” she said. “Attractive faces tend to be closer to a populational average, and because of this, they’re easier on the brain — They can be processed more rapidly.”

Once a natural preference for attractive faces develops, people tend to associate more positive traits with attractive people. They will then provide attractive people more opportunities and treat them better, creating an increased potential for happiness. Yet, the effect of the stereotype is small, Jankowitsch said.

“It just gives an upper edge in some certain circumstances and situations,” she said.

Journalism junior Doa Jafri has modeled for Spark Magazine, a publication produced by the University group Student Fashion Cooperative. Jafri said she couldn’t work at Wilhelmina Brown Model Management without her above-average looks. Yet, she said being attractive can also impair
career opportunities.

“Sometimes, if you’re trying to talk business with someone, they might take it the wrong way if you’re young and look a certain way,” she said. “You’re just not taken seriously.”