Abstract

We take advantage of a natural experiment to provide new, credible evidence on the health consequences of scheduling birth early for non-medical reasons. In May 2010, the Spanish government announced that a 2,500-euro universal “baby bonus” would stop being paid to babies born after December 31st, 2010. Using administrative data from birth certificates and hospital records, we find that more than 2,000 families shifted their date of birth from January 2011 to December 2010 (out of 9,000 weekly births). The affected babies had about 250 grams lower birth-weight, and suffered about 1,000 additional hospitalizations during their first 15 months of life.