Effects of the 2021 Expanded Child Tax Credit

• In Event: Health Impacts of Social Safety Net Policies: Interactions between Nutrition and Medical Care

Abstract

We investigate the effects of the 2021 expanded Child Tax Credit (CTC)’s advance monthly payments on levels of and disparities in infant and maternal health. Given prior evidence documenting effects of poverty and material hardship (see e.g. Wimer et al. 2021; Parolin et al. 2022) as strong determinants of health, we hypothesize that the monthly payments will ameliorate poor health at birth.. 

 

Harnessing the universe of births from restricted birth certificate data administered by the National Vital Statistics System, we deploy a difference-in-differences framework that compares children born into families with older siblings (the “treated” group) who were exposed to these payments in utero, to firstborn infants who were unexposed during pregnancy (the “control” group). We include pre-treatment-period births from early 2021 (in utero in the second half of 2020, when payments were not available) and treatment-period births from early 2022 (in utero in the second half of 2021 during the CTC payment period). Our primary outcomes include infant health at birth, measured using binary indicators for preterm (< 37 weeks), low birthweight (< 2,500g), and small for gestational age (< 10th percentile) as well as associated continuous measures. We examine average and heterogeneous treatment effects across a variety of individual characteristics (including race, education-level and other factors associated with differential access to health and prenatal care) and examine maternal health outcomes at birth (including gestational diabetes, and pre-eclampsia). 

 

Results indicate that the 2021 expanded Child Tax Credit is associated with meaningful increases in average birth weight and gestational age. These effects appear to be driven by Black non-Hispanic birthing people, where we observed an increased effect by 60% compared to the sample overall. That we fail to detect meaningful improvements in preterm birth or low birthweight suggests that the payments increased intrauterine growth predominantly among term infants. 

We examined a number of mechanisms that might explain this result, including the timing and frequency of prenatal care utilization, gestational diabetes, and preeclampsia diagnosis, and other perinatal health conditions. We find an increase in prenatal care initiation in the first trimester and in the number of prenatal care visits among treated infants. Results of this study provide novel evidence that unconditional cash transfers offer promise in addressing disparities in infant health.  

Authors

• Naomi Bethlehem Zewde, University of California - Los Angeles
  Presenting Author

• Jessica Erin Pac, University of Wisconsin-Madison
  Non-Presenting Co-Author

• Monika Nayak, University of California - Los Angeles
  Non-Presenting Co-Author

• Elizabeth Oltmans Ananat, Barnard College
  Non-Presenting Co-Author

• Christopher Wimer, Columbia University
  Non-Presenting Co-Author