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Can cigarette taxes during pregnancy mitigate the intergenerational transmission of socioeconomic status?

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  • Settele, Sonja
  • Ewijk, Reyn van

Abstract

Smoking during pregnancy is most prevalent among women with a low socioeconomic status and is negatively associated with important infant health measures such as birth weight. Cigarette taxes decrease smoking among pregnant women and lead to improved birth outcomes, especially among those with a low socioeconomic status. In this paper we investigate whether increasing cigarette taxes also translates into improved educational attainment of offspring from a low socioeconomic background. In order to answer this question, we exploit variation in cigarette taxes across U.S. states over time and analyze tax effects on grade retention and school enrollment among a large sample of adolescents representative of the population. We find that higher cigarette taxes during pregnancy are strongly associated with improved educational outcomes of children from a low socioeconomic background, but seem to have no effect on children from a higher socioeconomic background. Our findings therefore suggest that cigarette taxes can be an effective policy instrument for mitigating the propagation of a low socioeconomic status from one generation to the next.

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  • Settele, Sonja & Ewijk, Reyn van, 2018. "Can cigarette taxes during pregnancy mitigate the intergenerational transmission of socioeconomic status?," Labour Economics, Elsevier, vol. 55(C), pages 130-148.
    • Handle: RePEc:eee:labeco:v:55:y:2018:i:c:p:130-148
    DOI: 10.1016/j.labeco.2018.09.003
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    2. Srivastava, Preety & Trinh, Trong-Anh, 2021. "The effect of parental smoking on children’s cognitive and non-cognitive skills," Economics & Human Biology, Elsevier, vol. 41(C).
    3. Liang, Wenquan & Xue, Sen, 2021. "Pandemics and Intergenerational Mobility of Education: Evidence from the 2003 Severe Acute Respiratory Syndrome (SARS) Epidemic in China," GLO Discussion Paper Series 779, Global Labor Organization (GLO).
    4. Hoehn-Velasco, Lauren & Pesko, Michael & Phillips, Serena, 2022. "The Long-Term Impact of In-Utero Cigarette Taxes on Adult Prenatal Smoking," IZA Discussion Papers 15656, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Early life; Tobacco taxes; Socioeconomic inequalities;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality

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