Economic conditions and the health of newborns: Evidence from comprehensive register data

Abstract

We examine whether economic downturns are beneficial to health outcomes of newborn infants in developed countries. For this we use merged populationwide registers on health and economic and demographic variables, including the national medical birth register and intergenerational link registers from Sweden covering 1992-2004. We take a rigorous econometric approach that exploits regional variation in unemployment and compares babies born to the same parents so as to deal with possible selective fertility based on labour market conditions. We find that downturns are beneficial; an increase in the unemployment rate during pregnancy reduces the probability of having a birth weight less than 1,500 grams or of dying within 28 days of birth. Effects are larger in low socio-economic status households. Health improvements cannot be attributed to the parents' own employment status. Instead, the results suggest pathways more general than individual employment. * We thank the Editor Michele Pellizzari, two anonymous Referees, Anna Sjögren and participants at a seminar at the University of Aarhus and at EEA/ESEM and EALE conferences for useful comments and suggestions. Also, we thank Statistics Sweden and Socialstyrelsen for the use of the micro data registers and Hans-Martin von Gaudecker and Mårten Palme for their efforts in making these data accessible. We thank IFAU Uppsala, in particular Linus Liljeberg and Olof Åslund, for the data on unemployment rates.

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