Parental Education and Child Health: Evidence from a Natural Experiment in Taiwan

In 1968, the Taiwanese government extended compulsory education from six to nine years and opened over 150 new junior high schools at a differential rate among regions. Within each region, we exploit variations across cohorts in new junior high school openings to construct an instrument for schooling and employ it to estimate the causal effects of mother’s or father’s schooling on infant birth outcomes in the years 1978–1999. Parents’ schooling does indeed cause favorable infant health outcomes. The increase in schooling associated with the reform saved almost 1 infant life in 1,000 live births. “The one social factor that researchers agree is consistently linked to longer lives in every country where it has been studied is education. It is more important than race; it obliterates any effects of income.” Gina Kolata, “A Surprising Secret to Long Life: Stay in School,” New York Times, January 3, 2007, p. 1. This paper is a contribution to the literature on the relationship between years of formal schooling completed and good health. In particular we investigate whether the positive relationship between these two variables implies causality from the former to the latter. As the quotation from Kolata indicates, there is a large literature, reviewed in detail by Michael Grossman and Robert Kaestner (1997) and Grossman (2000, 2006), that shows that an individual’s own schooling is the most important correlate of his or her health and that parents’ schooling, especially mother’s schooling, is the most important correlate of child health. This finding emerges whether health levels are measured by mortality rates, morbidity rates, self-evaluation of health status, or physiological indicators of health, and whether the units of observation are individuals or groups. Improvements in child health are widely accepted public policy goals in developing and developed countries. The positive correlation between mother’s schooling and child health in numerous studies was one factor behind the World Bank’s campaign in the 1990s to encourage increases in maternal education in developing countries (World Bank 1993). In a 2002 issue of Health Affairs devoted primarily to the nonmedical determinants of health, Angus Deaton (2002) argues that policies to increase education in the U.S. and to increase income in developing countries are very likely to have larger payoffs in terms of health than those that focus on health care, even if inequalities in health rise. The same proposition with regard to the U.S. can be found in a much earlier study by Richard Auster, Irving Leveson, and Deborah Sarachek (1969). Since more education typically leads to higher income, policies to increase the former appear to have large returns for more than one generation throughout the world. Efforts to improve the health of an individual by increasing the amount of formal schooling that he or she acquires or that try to improve child health by raising maternal schooling assume that the schooling effects reported in the literature are causal. A number of investigators have argued, however, that reverse causality from health to schooling or omitted “third variables” may cause schooling and health to vary in the same direction. Governments can employ a variety of policies to raise the educational levels of their citizens. These include compulsory schooling laws, new school construction, and targeted subsidies to parents and students. If proponents of the third-variable hypothesis are correct or if health causes schooling, evaluations of these policies should not be based on studies that relate adult health or child health to actual measures of schooling because these measures may be correlated with unmeasured determinants of the outcomes at issue. In this paper we propose to use techniques that correct for biases due to the endogeneity of schooling to evaluate the effects of a policy initiative that radically altered the school system in Taiwan and led to an increase in the amount of formal schooling acquired by the citizens of that country during a period of very rapid economic growth. In 1968 Taiwan extended compulsory schooling from six years to nine years. In the period from that year through 1973, many new junior high schools were opened at a differential rate among regions of the country. We form treatment and control groups of women or men who were age 12 or under on the one hand and between the ages of 13 and 20 or 25 on the other hand in 1968. Within each region, we exploit variations across cohorts in new junior high school openings to construct an instrument for schooling. We employ this instrument to estimate the causal effects of mother’s or father’s schooling on the incidence of low birthweight and mortality of infants born to women in the treatment and control groups or the wives of men in these groups in the period from 1978 through 1999. The paper proceeds as follows. Section I outlines a conceptual framework, followed by a review of the related literature. Section II provides some background on education reform in 1968 in Taiwan. Section III indicates how we exploit aspects of the reform to construct instruments for parents’ schooling, presents estimates of the effects of the instrument on schooling, and discusses the specification of infant health outcome equations. Section IV contains reduced form and structural estimates of these equations, and Section V concludes.