Birth Order Differences in Early Inputs and Outcomes∗

We examine within-family differences in preand early postnatal investments as potential explanations for the “birth order effect” – significant differences in the educational and labor market outcomes across children of varying birth orders. Taking advantage of the rich information on in utero and early childhood conditions in the Children of the NLSY79, we find that, within the same household, siblings of higher birth order experience a lower reduction in cigarette usage during pregnancy, are breastfed less often, and experience less cognitive stimulation and emotional support at ages 0 to 1. Next, we test for the presence of birth order effects in early cognitive/non-cognitive test scores and educational attainment and examine whether these differences can be explained by variations in prenatal and early childhood inputs. While we do find a significant negative relationship between birth order and early test scores as well as educational attainment, these effects are robust to controlling for variations in early childhood factors. JEL Classifications: J13, I19 ∗We thank Colin Cameron, Aimee Chin, Deborah Cobb-Clark, Shelly Lundberg, Daniele Paserman, Andy Zuppann, and seminar participants at the University of Sydney, Melbourne Institute, University of New South Wales, University of Wollongong, the 35th Australian Health Economics Meetings, the BIG seminar at Universitat de Barcelona, and the 2013 ASSA/AEA Meetings for helpful comments and suggestions. Any errors are our own. †Department of Economics, University of Houston. E-mail: [email protected] ‡IEB, Universitat de Barcelona. E-mail: [email protected] §University of New South Wales & IZA. E-mail: [email protected]