Int. J. Environ. Res. Public Health 2010, 7 1905 Variables of alcohol consumption were constructed as follows: First, alcohol consumption was set to 1 if the respondent drank during the previous 30 days, and 0 if not. This question was then justified using a subsequent question regarding the number of alcoholic drinks consumed in total. Table 1 defines the variables. For babies born from 1985–2002, the average birth weight was 3,326 grams; 7% of babies were low birth-weight (LBW); 1% extremely low birth-weight (< 1,500 g, ELBW); and another 1% had low APGAR scores. On average, 12% of pregnant women drank alcohol. Asked about drinking “during the previous 30 days,” most of these women reported consuming about four drinks; 1% reported binge drinking. Alcohol taxes were derived from the Brewing Industry of the United States and National Conference of State Legislatures. In this paper, alcohol taxes combined federal and state taxes (adjusted to 1982–1984 CPI). Federal tax rates have been stable in nominal terms since 1951. The only increase in federal taxes on beer and wine occurred in 1991, when beer taxes doubled from 16 to 32 cents per six pack and wine taxes jumped from just over 3 cents to about 21 cents per 750 milliliter bottle. In 1985, tax rates on distilled spirits rose from $12.5 to $13.5 dollars per proof gallon [27]. State taxes increase more frequently such that there are variations across states. Appendix A shows the year when states last raised alcohol taxes. In a state where alcoholic beverages, particularly distilled liquors, are sold through state stores, taxes combine specific, ad valorem and implicit taxes. In the estimation, taxes are missing if it is a monopoly controlled state. Under current laws, the way in which alcohol taxes are levied involve different measures for different types of alcohol [28]. Liquor and distilled spirits are measured per proof gallon, per barrel for beer and per gallon for wine. Hence, taxes are much lower on the alcohol content of beer and wine than on the alcohol content of liquor/distilled spirits. Over this period (1985–2002), the average beer tax was 60 cents per six pack, wine tax $1 per 750 mL bottle and liquor tax $16 per proof gallon. Alcohol taxes were merged with both datasets, respectively, based on conception year. 3. Results and Discussion Table 2 reports the relationship between alcohol taxation and drinking during pregnancy. Models in Columns 1–3, which aim to show the direct impact of alcohol taxation on infant health, do not include maternal information. Models in Columns 4–6 include maternal characteristics, demonstrating whether adding mothers’ characteristics and thus demonstrate whether inclusion of maternal variables affects our understanding of the potential impacts of alcohol taxes on women’s behaviors and on subsequent newborn health. If results across models do not vary, the estimation is robust to model specification, meaning that alcohol taxes do impact infant health, even while controlling for mothers’ characteristics. The estimated marginal impacts of taxes on drinking prevalence were negative but statistically insignificant. The probability of binge drinking dropped by 3% points per one-cent increase in beer taxes, 1.5% points for an equivalent increase in wine taxes, and 0.6% points for liquor taxes, and these results do not change across models. These results are statistically significant, which suggests that there exist negative impacts of alcohol taxes on heavy drinking among pregnant women. The coefficient of liquor taxes is small while reasonable since the unit of taxes variables is “cent” (to be consistent across three types of taxes) while the mean of liquor taxes is $15, or 1,500 cents. The effect of taxes on quantity of drinks, however, decreased as more controls were included, implying that