Taxing for healthier beginnings: The impact of a major tobacco tax hike on birth weight in Mexico

Abstract

Tobacco consumption during pregnancy poses significant risks to maternal and neonatal health. In 2011, Mexico implemented a large nationwide increase in tobacco excise taxes. Because the policy was applied uniformly across the country and detailed smoking data are limited, identifying causal effects is particularly challenging. Using comprehensive vital statistics records on all singleton live births in Mexico, we apply a regression discontinuity in time design to evaluate the short-term impact of a 250% increase in the excise tax on tobacco products on newborn health outcomes. Our findings provide evidence of moderate short-term increases in birth weight after the tax hike. Although the effects diminish over time and show sensitivity to model specification, they may indicate potential long-term public health benefits. This study provides new evidence on the effects of nationwide tobacco tax increases on birth outcomes in middle-income countries.