Increases in Community Income Improve Birth Outcomes

A briefing paper prepared for the Council on Contemporary Families by Molly A. Martin, PhD, Department of Sociology and Criminology, The Pennsylvania State University

Birth outcomes are strongly linked to income but proving a direct cause-and-effect relationship has been challenging. Our new study, published in Demography, uses the economic boom from Pennsylvania’s Marcellus Shale natural gas development as a “natural experiment” to examine how community-level income gains affect pregnancy behaviors and birth outcomes.

In our research examining birth outcomes before and after the Marcellus Shale boom (2007-2012), we found that a $1,000 increase in average community income led to a 1.5 percentage point decrease in low birthweight births and a 1.8 percentage point increase in expectant parents receiving adequate prenatal care. These benefits accrued across the study site and were also significant in high-poverty areas, suggesting economic development may help reduce adverse birth outcomes among high-risk, disadvantaged communities.

Our study analyzed over 78,000 births in Pennsylvania school districts above the Marcellus Shale geological formation, comparing births in areas that industry experts predicted – before the first well was drilled – to be the best for natural gas extraction with births in areas predicted to be less productive. This geological data allowed us to predict where the economic boom would be greater based on the characteristics of the underlying rock formed 39 million years ago – long before residents made choices about their health behaviors, health care and family goals.

We focus on the economic impacts of natural gas development in Pennsylvania because they were large: gains of over $14 billion between 2008 and 2010 in corporate spending, job growth, and local tax revenue. These gains were important because Pennsylvania was still recovering from the Great Recession. Yet the environmental hazards of Marcellus Shale development, like water contamination, air pollution, and forest disruption, are also important. More research is needed to examine the environmental and health risks of hydraulic fracturing and other oil and gas industry practices.

We used the geological variation of the shale to identify cause-and-effect relationships. With a pre-drilling map of the Marcellus Shale geological formation created by the oil and gas industry, we classified school districts into “treatment” and “comparison” groups based on the predicted economic value of the shale for gas production.

Among the 282 Pennsylvania school districts above the Marcellus Shale, 184 are in the treatment group and 98 are in the comparison group. Relative to the comparison districts, community income in the treatment districts increased by $1,825 per household per year. New York treatment districts did not experience these community income gains because “fracking” is banned there.

We made our causal estimates more accurate with additional steps. First, we accounted for a host of other differences between the treatment and comparison groups and changes that both groups experienced over time. Finally, we examined siblings born before and after the economic boom to control for family characteristics, like the parent’s genetic predispositions, childhood experiences, personality traits and preferences. Together, these approaches allowed us to isolate the effects of community income gains on birth outcomes.

Our findings show that community-wide income gains can improve infant birth outcomes even in the presence of potential environmental risks from natural gas development. Our research design controlled for area-wide hazardous exposures, which prior research demonstrates are harmful for infant health. Notably, we did not find greater water pollution, air pollution, or other environmental hazards in treatment districts relative to comparison districts.

This means our quasi-experimental groups based on pre-drilling information really captured potential income, not drilling itself or its repercussions. Treatment districts did receive more income, but they were just as likely as comparison districts to experience the environmental hazards associated with drilling and gas production. By design, our study was able to isolate the effect of community income gains.

Our study provides strong causal evidence that raising community-level income can lead to reduced rates of low birthweight births. This is notable because low birthweight is an important early life indicator that strongly predicts infant mortality, inhibited cognitive development, and numerous physical health challenges and diseases. In fact, low birthweight and its subsequent childhood risks have long-term consequences like lowered educational attainment, lower lifetime earnings, and shorter lifespans, which has led some scholars to speculate that low birth weight is a key mechanism in the transmission of poverty across generations.

We found that income appears to affect birth outcomes through multiple pathways beyond maternal health behaviors like smoking, gestational weight gain, and prenatal care use. Thus, our work suggests that economic development and other policies that increase community income could reduce the incidence of low birth weight and, thereby, improve population health beyond infancy.

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For More Information, Please Contact:

Molly A. Martin, PhD
Department of Sociology and Criminology
The Pennsylvania State University
mam68@psu.edu

Citation: Martin, M. A., Green, T. L., & Chapman, A. (2024). The Causal Effect of Increasing Area-Level Income on Birth Outcomes and Pregnancy-Related Health: Estimates from the Marcellus Shale Boom Economy. Demography 11691517.  https://doi.org/10.1215/00703370-11691517