Income and Birth Outcomes: Examining the Mechanisms of the Earned Income Tax Credit
*Names in bold indicate Presenter
The purpose of this study is to analyze the mechanisms through which state-level EITC affects LBW rates in the United States. Utilizing the 2016 restricted state-level vital statistics data, the study tests three mediation effects: maternal smoking, prenatal care use and stress. The analytical sample included only African American women (n=559,233) as they face the highest rates of adverse birth outcomes and form the majority of the low-income population. Using a PATH analysis, I simultaneously model the three hypothesized mediation effects controlling for nativity, adequate weight gain, marital status, education, number of children and body mass index. Preliminary results show that state adoption of an EITC is associated with a 6.2% (0.008) improvement in LBW amongst African American women, and this effect is mediated by prenatal care use and stress. However, state adoption of an EITC increased the likelihood of smoking during pregnancy [2.2% (0.0006)] but was associated with an increase in prenatal care use [3.3% (0.001)] and a reduction in stress [0.28% (0.001)]. The findings also reveal that stress has the highest mediation effect in the association of EITC and LBW.
The Healthy People 2020 cites poverty as a major determinant for adverse birth outcomes and has prioritized the reduction of LBW in its objectives. Understanding the mechanisms through which EITC operates is important for policymakers to understand how different outcomes are produced. The findings from this study suggest the need for enhanced smoking cessation programs amongst the African American population to reinforce the effects of the EITC.