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Does a pint a day affect your child’s pay? The effect of prenatal alcohol exposure on adult outcomes

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Abstract

This paper utilizes a Swedish alcohol policy experiment conducted in the late 1960s to identify the impact of prenatal alcohol exposure on educational attainments and labor market outcomes. The experiment started in November 1967 and was prematurely discontinued in July 1968 due to a sharp increase in alcohol consumption in the experimental regions, particularly among youths. Using a difference-in-difference-in-differences strategy we find that around age 30 the cohort in utero during the experiment have substantially reduced educational attainments, lower earnings and higher welfare dependency rates compared to the surrounding cohorts. The results indicate that investments in early-life health may have far reaching effects on economic outcomes later in life.

Suggested Citation

  • Nilsson, J Peter, 2008. "Does a pint a day affect your child’s pay? The effect of prenatal alcohol exposure on adult outcomes," Working Paper Series 2008:4, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  • Handle: RePEc:hhs:ifauwp:2008_004
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    1. Gerard J. van den Berg & Maarten Lindeboom & France Portrait, 2006. "Economic Conditions Early in Life and Individual Mortality," American Economic Review, American Economic Association, pages 290-302.
    2. Anders Bohlmark & Matthew J. Lindquist, 2006. "Life-Cycle Variations in the Association between Current and Lifetime Income: Replication and Extension for Sweden," Journal of Labor Economics, University of Chicago Press, vol. 24(4), pages 879-900, October.
    3. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2007. "From the Cradle to the Labor Market? The Effect of Birth Weight on Adult Outcomes," The Quarterly Journal of Economics, Oxford University Press, vol. 122(1), pages 409-439.
    4. Douglas Almond & Lena Edlund & Mårten Palme, 2009. "Chernobyl's Subclinical Legacy: Prenatal Exposure to Radioactive Fallout and School Outcomes in Sweden," The Quarterly Journal of Economics, Oxford University Press, vol. 124(4), pages 1729-1772.
    5. Michael J. Moore & Philip J. Cook, 1995. "Habit and Heterogeneity in the Youthful Demand for Alcohol," NBER Working Papers 5152, National Bureau of Economic Research, Inc.
    6. Marco Francesconi, 2008. "Adult Outcomes for Children of Teenage Mothers," Scandinavian Journal of Economics, Wiley Blackwell, vol. 110(1), pages 93-117, March.
    7. Stephen G. Donald & Kevin Lang, 2007. "Inference with Difference-in-Differences and Other Panel Data," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 221-233, May.
    8. Rosemary Hyson & Janet Currie, 1999. "Is the Impact of Health Shocks Cushioned by Socioeconomic Status? The Case of Low Birthweight," American Economic Review, American Economic Association, pages 245-250.
    9. Case, Anne & Fertig, Angela & Paxson, Christina, 2005. "The lasting impact of childhood health and circumstance," Journal of Health Economics, Elsevier, vol. 24(2), pages 365-389, March.
    10. Michael Grossman & Sarah Markowitz, 2005. "I Did What Last Night? Adolescent Risky Sexual Behaviors and Substance Abuse," Eastern Economic Journal, Eastern Economic Association, vol. 31(3), pages 383-405, Summer.
    11. Hunt, Jennifer, 2006. "Do Teen Births Keep American Crime High?," Journal of Law and Economics, University of Chicago Press, vol. 49(2), pages 533-566, October.
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    Cited by:

    1. Wüst, Miriam, 2010. "The effect of cigarette and alcohol consumption on birth outcomes," Working Papers 10-5, University of Aarhus, Aarhus School of Business, Department of Economics.
    2. Flavio Cunha & James J. Heckman, 2009. "The Economics and Psychology of Inequality and Human DEvelopment," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 320-364, 04-05.
    3. Sonia Bhalotra & Samantha Rawlings, 2013. "Gradients of the Intergenerational Transmission of Health in Developing Countries," The Review of Economics and Statistics, MIT Press, pages 660-672.
    4. Elaine Kelly, 2011. "The Scourge of Asian Flu: In utero Exposure to Pandemic Influenza and the Development of a Cohort of British Children," Journal of Human Resources, University of Wisconsin Press, vol. 46(4), pages 669-694.
    5. Fertig, Angela R. & Watson, Tara, 2009. "Minimum drinking age laws and infant health outcomes," Journal of Health Economics, Elsevier, vol. 28(3), pages 737-747, May.
    6. James J. Heckman, 2008. "Schools, Skills, And Synapses," Economic Inquiry, Western Economic Association International, vol. 46(3), pages 289-324, July.
    7. Eriksson, Tor & Pan, Jay & Qin, Xuezheng, 2014. "The intergenerational inequality of health in China," China Economic Review, Elsevier, pages 392-409.
    8. Jürges, Hendrik, 2013. "Collateral damage: The German food crisis, educational attainment and labor market outcomes of German post-war cohorts," Journal of Health Economics, Elsevier, vol. 32(1), pages 286-303.
    9. Douglas Almond & Janet Currie, 2011. "Killing Me Softly: The Fetal Origins Hypothesis," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 153-172, Summer.
    10. repec:mea:meawpa:12253 is not listed on IDEAS
    11. David Simon, 2013. "Does Early Life Exposure to Cigarette Smoke Permanently Harm Childhood Health? Evidence from Cigarette Tax Hikes," Working papers 2013-21, University of Connecticut, Department of Economics, revised May 2015.

    More about this item

    Keywords

    Alcohol policy; infant health; education; earnings;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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