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Parental Investments in Response to Early Life Health
education, health and earnings. However, the role of parents in reinforcing initial health inequities or
mitigating them is not well understood. Furthermore, most studies do not study investments over a life
course and look at a single dimension of response such as education or health and ignore nonhuman
capital transfers. We fill these gaps in the literature by studying parental responses over multiple stages of
the life course and for multiple dimensions, including nonhuman capital transfers.
We utilize the overlap of Ramadan fasting month with pregnancies for Muslims as a natural experiment for
studying parental responses to fetal under nutrition. Ramadan is a holy month in the Islamic calendar.
Practicing Muslims are required to observe a strict fast from sunrise to sunset for a month. Since about
seventy five percent of all pregnancies overlap with Ramadan, it is estimated more than 1.2 billion Muslims
were potentially exposed to their mother’s fasting in utero. Our work builds on some recent studies which
show the negative effects of Ramadan exposure in utero on birth weight, cognition and labor market
outcomes later in life.
We study Muslims in Indonesia, the largest Muslim majority country in the world. Nationally representative
data from the 2007 wave of the Indonesian Family Life Survey (IFLS 4) is used to study parental investment
response on human capital with detailed expenditures on health and education and on nonhuman
capital transfers (e.g. dowries) over a life cycle. Results show that for children younger than five years, parents are
less likely to get their exposed (during Ramadan in utero) children vaccinated and invest less in their diet.
However, we find an opposite pattern for older children, with parents investing more in vitamins or
supplements but we do not find any differences between exposed and nonexposed
children on educational investments. However, our results show that compared to unexposed children, mothers of exposed children
have lower expectations about future educational attainment of their children. In contrast to most papers in
the larger literature, we also look at nonhuman capital responses to fetal health shocks and find gender
differences in parental response. Females get fewer dowries and bring fewer assets into marriage, an
important marker for future bargaining power. For male adults, however, parents are more likely to provide
monetary and nonmonetary help attempting to mitigate inequities. We do not find any differential
responses on prenatal care. Overall our results suggests, parents make complimentary investments in
response to initial health endowments particularly for children younger than five years and mostly in the
form of investing in their children’s health care but also in terms of dowries for their daughters. These
results have important policy implications: if its not feasible to nudge pregnant women from unhealthy
cultural practises during pregnancy, one can instead focus on health care and physical capital transfers
early and later in life which may help mitigate the initial health inequities.