Family Economic Security Policy Effects on Infant Health: State-Level Earned Income Tax Credit (EITC) and Minimum Wage

Introduction: Low income is a potent risk factor for low birth rate (LBW). LBW leads to increased risk of infant mortality and deleterious health effects into adulthood, including lower cognitive achievement and health during childhood, increased probability of dropping out of high school, and effects on adult health equivalent to being nine years older. The CDC has estimated that half of women giving birth in the U.S. are either poor or near-poor. A variety of policies at the federal and state levels are designed to provide economic security among American families. Two key policies are minimum wage laws and the EITC. In this presentation, we (1) introduce our development of a policy surveillance system to measure changes in state laws that affect family economic security, (2) describe variation across states and time from 1980 to 2011 in EITC and minimum wage laws, and (3) report results from our evaluation of the association of state-level EITC and minimum wage changes on the probability of LBW over time.

Methods:  We partnered with legal scholars to collect state-level laws using LawAtlas, a legal coding platform combining textual, interpretative legal research done by lawyers with quantitative coding of reliable and valid policy indices based on the measurement methods of empirical scientists. As part of LawAtlas, we conducted coding of all state-level EITC and minimum wage law changes from 1980-2011. We estimated the effects of state-level EITC and minimum wage laws on LBW at the state-month level using a fixed effects regression model including state and year fixed effects. State-month observations were weighted by state population. Robust standard errors were calculated via a sandwich estimator to account for serial correlation within state.

Results:  The legal surveillance data indicate wide variation across states and time of theoretically-relevant components of the EITC and minimum wage laws. Preliminary analyses show a statistically significant reduction in the rates of LBW associated with increases in the state-specific minimum wage; these effects are modified by the presence of a state-level EITC. The largest reductions in the rate of LBW births is seen in states with both a state-specific minimum wage at least a dollar above the federal minimum wage and a state-level EITC. 

Conclusions: State policy variations offer a valuable opportunity for scientists to conduct natural experiments and contribute to evidence linking family economic security policy effects to child health and wellbeing. Such rigorous research will help guide design of evidence-based family economic security policies to improve population health and reduce health inequities.