Baby Boomlets and Baby Health: Hospital Crowdedness, Treatment Intensity, and Infant Health

Mindy Marks and Kate Choi

No 201440, Working Papers from University of California at Riverside, Department of Economics

Abstract: To identify the causal relationship between health care spending and infant health, we introduce a new instrument: the number of infants born on a given day in a given hospital. The thought experiment is on a crowded day at-risk infants receive reduced care because resource constraints are binding. Using detailed information on every birth in California from 2002 to 2006, we find that hospital crowdedness impacts treatment intensity. We show that OLS estimates overestimate the benefits of medical care. Our results suggest that the mortality benefits from additional spending are negligible and that more intensive treatment increases hospital readmission rates.

Date: 2011-05
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