MONEY TRANSFER AND BIRTH WEIGHT: EVIDENCE FROM THE ALASKA PERMANENT FUND DIVIDEND |
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| Authors: | Wankyo Chung Hyungserk Ha Beomsoo Kim |
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| Affiliation: | 1. (82) 33 248 1848(82) 33 256 3424;2. Associate Professor, School of Business, Hallym University, Chuncheon, Korea;3. (82) 2 3290 2200(82) 2 3290 2200;4. Ph.D. Candidate, Department of Economics, Korea University, Seoul, Korea |
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| Abstract: | The positive relationship between income and health is well established. However, the direction of causality remains unclear: do economic resources influence health, or vice versa? Exploiting a new source of exogenous income variation, this study examines the impact of the Alaska Permanent Fund Dividend (APFD) on newborns' health outcomes. The results show that income has a significantly positive, but modest effect on birth weight. We find that an additional $1,000 ($2,331 in 2011 dollars) increases birth weight by 17.7 g and substantially decreases the likelihood of a low birth weight (a decrease of around 14% of the sample mean). Furthermore, the income effect is higher for less‐educated mothers. Based on a gestation‐weight profile in the sample, increased gestation owing to the APFD could explain a maximum of 34%–57% of the measured weight increase, although we are unable to examine all the potential mechanisms. (JEL I10, I18, I12) |
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