Baby Bump? Birth Month, Family Income, and Early Childhood Development

54 Pages Posted: 4 Nov 2023

See all articles by Katherine Engel

Katherine Engel

American University

Dave E. Marcotte

University of Maryland Baltimore County; IZA Institute of Labor Economics

Abstract

Federal and state laws in the U.S. provide families with babies born just before theend of the year thousands of dollars in tax savings. Because this income windfall isrealized during the first few months of a newborn’s life, we assess whether babiesborn in December experience developmental advantages in early childhood comparedto those born right after the New Year. Using data from the Child DevelopmentSupplement of the Panel Study of Income Dynamics and the Children of the NationalLongitudinal Survey of Youth, we implement a regression discontinuity design thatexploits variation in birth timing. We show that while children born in Decemberhave a weight disadvantage at birth compared to those born in January, they have anaverage weight-gain advantage of between 0.7 to 1.2 pounds (0.08 to 0.14 standarddeviations) during subsequent follow-up interviews. We also find that end-of-yearbabies reach early developmental milestones faster, but exhibit no advantage inmemory, word recognition or applied problem solving. Finally, we illustrate the taxsavings received by families with end of year babies are substantial and areconsistent with the end-of-year birth developmental advantage.

Keywords: Income, Child developement, EITC

Suggested Citation

Engel, Katherine and Marcotte, Dave E., Baby Bump? Birth Month, Family Income, and Early Childhood Development. Available at SSRN: https://ssrn.com/abstract=4623452 or http://dx.doi.org/10.2139/ssrn.4623452

Katherine Engel

American University ( email )

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United States

Dave E. Marcotte (Contact Author)

University of Maryland Baltimore County ( email )

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Baltimore, MD 21250
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410-455-1172 (Fax)

IZA Institute of Labor Economics

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Bonn, D-53072
Germany

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