Intergenerational transmission in health: Causal estimates from fixed effects instrumental variables models for two cohorts of Australian children

This paper contributes to an emerging body of literature on intergenerational transmission in health by presenting the first causal estimates on the impact of maternal mental health on child health. The potential endogeneity of maternal mental health is dealt with by utilising nationally representative panel data from two cohorts and individual fixed effects instrumental variables models. While previous literature has found evidence supporting detrimental effects of poor maternal mental health on child health our results found no evidence to support this. Our results hold irrespective of whether we look at the contemporaneous or intertemporal effects. We also found little differential impact based on the gender or age of the child and the levels of maternal education or household income. These results demonstrate that failing to account for endogeneity of maternal mental health could over-estimate the harmful impact of poor maternal mental health on child health. Our findings are robust to a battery of sensitivity and specification tests.