Does economic recession impact newborn health? Evidence from Greece

This study examines the impact of the Greek recession on newborn health. Using a large administrative dataset of 838,700 births from 2008 to 2015, our analysis shows that birth weight (BW) and pregnancy length are generally procyclical with respect to prenatal economic climate, while the risk of low birth weight and preterm birth are both countercyclical. We report heterogeneity in the relationship between business cycle fluctuations during pregnancy and newborn health across socioeconomic groups. Birth outcomes of children born to low socioeconomic status (SES) families are sensitive to economic fluctuations during the first and third trimesters of the pregnancy, whereas those of high-SES newborns respond to economic volatility only in the first trimester. These results are robust, even after using different measures of economic climate and uncertainty. After accounting for potential selection into pregnancy, we find that in utero exposure to economic crisis is linked with a BW loss, which is driven by the low-SES children. Our findings have social policy implications. The impact of economic crisis on birth indicators is more detrimental for the low-SES children, resulting in a widening of the BW gap between children of low- and high-SES families. This could, in turn, exacerbate long-term socioeconomic and health inequalities and hinder social mobility.