Macro-Economic Conditions and Infant Health: A Changing Relationship for Black and White Infants in the United States

We study whether the relationship between the state unemployment rate at the time of conception and infant health, infant mortality and maternal characteristics in the United States has changed over the years 1980-2004. We use microdata on births and deaths for years 1980-2004 and find that the relationship between the state unemployment rate at the time of conception and infant mortality and birthweight changes over time and is stronger for blacks than whites. For years 1980-1989 increases in the state unemployment rate are associated with a decline in infant mortality among blacks, an effect driven by mortality from gestational development and birth weight, and complications of placenta while in utero. In contrast, state economic conditions are unrelated to black infant mortality in years 1990-2004 and white infant mortality in any period, although effects vary by cause of death. We explore potential mechanisms for our findings and, including mothers younger than 18 in the analysis, uncover evidence of age-related maternal selection in response to the business cycle. In particular, in years 1980-1989 an increase in the unemployment rate at the time of conception is associated with fewer babies born to young mothers. The magnitude and direction of the relationship between business cycles and infant mortality differs by race and period. Age-related selection into motherhood in response to the business cycle is a possible explanation for this changing relationship.