Effect of Changing Business Condition on Prenatal Health

Abstract

Previous studies from developed countries suggest that babies conceived during recessions have better birth outcomes. However, the issue of whether the relationship between business condition and infant health differs across countries remains less clear. This paper investigates how the macroeconomic conditions to which mothers are exposed during pregnancy affect the birth outcomes of children. The analyses are based on the universe of birth registration records from 1993 to 2009 that are linked to the unemployment statistics by province and month of birth. Results indicate that prenatal exposure to higher unemployment significantly reduces birth weights and increases the risk of low birth weight. A recession has a stronger negative effect on fetal health during the first and second trimesters than in the final stage of pregnancy. The negative effects of prenatal exposure to higher unemployment rates on birth weight are observed only for the children of non-working mothers. Higher unemployment rates during pregnancy had considerably stronger negative effects on birth outcomes during the period before the financial crises of 1998 and 1999 than in the post-crisis period.