The Region

Janet Currie began her career as a labor economist, with important work on game and bargaining theory, arbitration and negotiation strategy, and wage and employment determination. Today, as director of ’s Center for Health and Wellbeing, she explores the frontiers of genetic expression during fetal development, the impact of incentives on provision of health care and the effec- tiveness of the U.S. social safety net. Further, as director of the National Bureau of Economic Research’s Program on Children, she encourages cutting-edge research on pollution from cook stoves in India, the impact of drought on education and the distributional effects of Head Start. The core element of all of this work—the bridge that connects what seem quite disparate fields of economic research—is human capital. It’s the idea—once controversial, but now undisputed—that humans possess skills, knowledge and abilities of enormous economic value. Some human capital is innate, but much is acquired through education, training and experience, as well as investment in physical and mental health. Understanding human capital, its many sources and the economic outcomes associated with its enhancement or degradation form a path that Currie has pursued for decades. Currie is known for her keen insight, innovative technique and unwavering dedication to solid research. “The thing that characterizes Janet and her work is her fierce determination to get to the bottom of social problems—particularly those concerning children,” observed economist , a colleague and mentor. “She takes on Head Start, Medicaid or child nutrition, and works on it tirelessly over 15 years or more, using different data and methods to really understand what’s going on.” Currie herself has no trouble explaining the coherence of her research agenda. “Labor economists think a lot about human capital and investments in it. Tradition- ally, that’s something to do with education,” she notes. “But I’m interested in health as human capital as well, and understanding how health and education intersect.” And Currie is finding that interactions are complex and cross-generational. Maternal health affects child educational outcomes; education, in turn, influences parental and child health; and both have tremendous economic consequences. “It is a broad concept, human capital,” she observes. “Not all these different boxes, but an integrated whole.”

September 2012 The Region

Photographs by Peter Tenzer Peter by Photographs

13 September 2012 The Region

FINANCIAL INCENTIVES Currie: Yes. It’s argued that these varia- causing surgical complications, then AND MEDICAL PRACTICE tions show there’s waste or inappropriate putting caps on damages makes you do utilization, but that’s not a very direct way more and not fewer. Region: I’d like to start with a few ques- to go at it. The QJE piece on C-sections JSL reforms, which had been largely tions regarding your research on incen- was looking at a specific argument about neglected, are interesting from an eco- tives and health care. Your 2008 Quar- why doctors might be doing too much, nomic standpoint because they get you terly Journal of Economics study of tort which is that they’re afraid of legal liability. away from this deep pockets regime to reform and birth outcomes with your It’s very common for people to say doc- one where you’re going to sue the hos- husband, Bentley MacLeod, and your tors do too much because they’re afraid of pital and the doctor. So it increases the 2011 paper together that broadened this being sued if they don’t. But there’s a re- doctor’s legal liability if they do some- “joint and several liability” research be- ally obvious alternative hypothesis, which thing wrong. yond childbirth procedures suggested is that doctors do too much because the that economic incentives play a crucial more they do, the more they get paid. Region: So the new JSL regime appor- role in both the U.S. tort system and tions liability among concerned parties, medical practice. Region: Sure. Incentives work. not simply to the deepest pocket. Could you tell us more about this work on the complex and sometimes Currie: Yet no one ever says that, so in our Currie: That’s right. And it reduced C-sec- conflicting financial incentives in paper, we look at how people respond to tions. So our results point to the idea that health care and how it might relate (if changes in the liability environment. One the reason we have so many C-sections is at all) to your June 2012 NBER paper of the things we realized while we were that doctors make twice as much money on physician-induced antibiotic use in doing it is that for something like child- doing them, which is the same thing we China … birth, the doctor often doesn’t really face had found in an earlier study of Med- any financial liability because if you have icaid fees where we were looking at the Currie: Yes, it’s all very closely related, jurisdiction with Joint and Several Liabil- differential [in payment] between doing actually … ity (JSL), people are going to go for the a C-section or doing a normal delivery. deep pocket. The deep pocket is not the When that differential increased, the rate Region: And for that matter, perhaps also doctor; the deep pocket is the hospital. of C-sections went up for the Medicaid to your much earlier American Economic If you actually go and read these cases, people. So it’s consistent with that. Review paper with Jonathan Gruber and sometimes they seem very strange. You In the more recent paper about JSL, Michael Fischer on physician payments, have a C-section; something goes terribly we were trying to look more broadly at which found that increasing Medicaid/ wrong. And instead of talking about what what happened to accident rates. We’re private fee ratios significantly decreased went wrong in the surgery, they’re spend- looking at accidental deaths, and most infant mortality rates. ing all of their time saying, “Well, the accidental deaths are actually among the Would you tell us more about this nurse should have done this or that.” The elderly. Many of them are trip-and-fall body of work? reason for that is that the nurse is an em- cases: Somebody leaves something ly- ployee of the hospital, while the doctor is ing around or doesn’t fix the handrail, Currie: Sure. Physician incentives are an independent contractor. So if you want and an elderly person falls and dies. And extremely important for the health care to nail the hospital, the deep pocket, you again, we found that going away from system, and everyone—or at least all have to show that the nurse was negligent. the common law regime that encour- health economists—thinks that finan- The upshot of our study is that differ- aged going after deep pockets to a legal cial incentives can distort people’s deci- ent types of tort reforms have quite dif- regime where everybody is responsible sions. But it’s very hard to pin that down. ferent effects. We found that if you put for the damage that they cause reduced There’s a lot of literature on things like caps on damages, you actually got more accident rates. small area variations in use of medi- C-sections, not less. People found that cal care saying that utilization rates are counterintuitive because their belief was Region: So there, too, the economic in- much lower in Minnesota than they are the reason the doctors are doing C-sec- centives mattered. And then there’s the in Florida, for instance, but people don’t tions is to avoid liability. Chinese study—a totally different cul- live longer in Florida, even though they ture, a very different health care system. get extra care. Region: The conventional wisdom, right? Currie: Well, yes, but economists think Region: The Dartmouth research [online Currie: Yes, but on the other hand, if that people are the same everywhere, at dartmouthatlas.org/]. you’re doing too many C-sections and right? In some fundamental sense.

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In China, you don’t go to the doctor, tions in that study, with, for instance, very striking. The person comes in and you go to the hospital. Everybody’s treat- patients offering gifts to the doctor or gives this really trivial gift. We have a ed on an outpatient basis. Also in China, clearly stating that the doctor’s recom- picture of it. It’s this funny pen with a hospitals are financed largely from drug mendation would not influence what little “Hello Kitty” or something on it. sales. There’s a very strong incentive to they would actually do. The “patient” also makes a little speech sell people drugs. Our study was an ex- about how much they respect doctors, perimental audit where we sent people Currie: Yes, in our initial study, our which perhaps is the real gift involved. complaining of vague symptoms sug- people [the “patients”] just presented In this experiment, the doctors who re- gestive of mild colds or flu to clinics and with these symptoms, and the experi- ceive the pen are less likely to prescribe then kept track of what medicines they mental treatment was that they would antibiotics, and they also spend a lon- were prescribed. say, “I saw on the Internet that you ger time with the patient and generally The results were really kind of hair- shouldn’t give antibiotics for a cough are more attentive. They do respond raising in the sense that none of the people or cold.” That simple intervention re- to that small gift. And so, we thought, we sent in should have gotten antibiotics, duced antibiotic prescriptions by 20 that shows that the doctor doesn’t but I think 60 percent of them got antibi- percent. But other researchers said to think that the antibiotics are what the otic prescriptions. Most of them got more us, “Well, that doesn’t really establish patient wants because if it was, then than one antibiotic prescription, and why the doctors are prescribing the they would be responding to the gift by many of them were getting very sophis- drugs. Maybe they’re prescribing the doing more of what the patient wants ticated, expensive antibiotics that you’re drugs because they think that’s what instead of less. not supposed to use for trivial infections the patients want.” because they’re supposed to be saved for We wanted to get at that mechanism, Region: It makes one think about the im- more dangerous sorts of infections. and so in our second experiment, we pact of far more significant gifts from the had a number of different treatments. manufacturers, often through pharma- Region: And you had three or four varia- The results of the gift treatment were ceutical reps.

It’s very common for people to say doctors do too much because they’re afraid of being sued if they don’t. But there’s a really obvious alternative hypothesis, which is that doctors do too much because the more they do, the more they get paid. … Our results point to the idea that the reason we have so many C-sections is that doctors make twice as much money doing them, which is the same thing we had found in an earlier study of Medicaid fees.

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Currie: Oh, yes, there’s a huge litera- HEALTH INSURANCE tives and that they typically find the least ture on that. It’s very interesting. If you AND HEALTH CARE costly way to deal with mandates. Maybe Google “pen and pharmaceuticals” or they also say something about unintend- “pen and doctor,” you come up with all Region: With several colleagues, over a ed consequences of laws. The Hill-Bur- of this literature where people are argu- number of years, you’ve examined the ton study looked at this old law … ing about whether physicians can be in- impact of public health insurance, such fluenced by a trivial gift like a pen, which as Medicaid, especially in the context of Region: Enacted in 1946. pharmaceutical companies give out all managed care, and the effect of expand- the time, along with little memo pads or ing public health insurance on health care Currie: Yes, but it went on for some things like that. utilization and health status. You’ve also period of time, and hospitals that got looked at the interaction between private money under Hill-Burton were required Region: Let alone funding medical con- and public provision of health care. for 20 years to devote 3 percent of their ferences and the like. Two studies in particular caught my revenues to indigent care. We show in eye—your 2011 work with Douglas Al- our study that the hospitals did do that: Currie: That’s right; everybody realizes mond and Emilia Simeonova of the ex- They were spending 3 percent of their that, yes, conference funding could piration of Hill-Burton requirements in revenues on indigent care. But the other influence people, and so that’s bad. Florida and your 2007 piece with Anna thing—and this is consistent with some But there are lots of people who’ve Aizer and Enrico Moretti on Medicaid work that Mark Duggan did in Califor- written in very respected publications managed care in California. nia—was that we looked at who they saying, “It’s ridiculous to think that What does this research, those two choose to serve [Duggan, Mark. 2000. doctors’ behavior could be influenced and the others you’ve done, tell us about “Hospital Ownership and Public Medi- by these trivial things.” I suppose the the incentives, market structures and cal Spending.” Quarterly Journal of Eco- same people would say, “Oh, you can’t public institutions that are most condu- nomics 115 (November): 1343-74]. learn anything from a study about cive to provision of quality health care at The hospitals seemed to have looked these Chinese doctors because they’re a reasonable cost? around and said, “OK, what class of poor, or maybe a pen means more to patients are the best people to serve, them,” or something. I don’t think so. Currie: Yes, that’s a good question. I think given that we have to serve a bunch of I think it’s just human nature to want both of those papers show that provid- indigent people?” And they picked preg- to reciprocate. ers are incredibly responsive to incen- nant women. Most pregnant women are

Providers are incredibly responsive to incentives, and they typically find the least costly way to deal with mandates. … Hospitals that got money under Hill-Burton were required for 20 years to devote 3 percent of their revenues to indigent care. … The most striking thing is how rapidly the hospitals responded and how much they can change their service mix to try and attract the type of patients that are profitable.

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healthy. They typically have a short stay, have to be covered by the capitated pay- so you don’t have this huge right tail of ment. It turned out they had a carve-out A number of states seem to be expenses. for neonatal intensive care, which sounds But they don’t look around and say, fair on the face of it because neonatal interpreting the ruling as saying “Oh, let’s get elderly diabetics,” right, intensive care is very expensive, and so that the federal government can’t who might have a huge right tail, or kid- maybe it is unfair to the plan to expect it boss them around when it comes to ney dialysis people. So we were looking to be covered by the one capitated pay- at what happened when these mandates ment if they happen to get a very sick in- Medicaid and they can change the expired. Many hospitals just closed their fant. But that meant that Medicaid man- provisions of the program however maternity units. They were like, “OK, we aged care plans had zero incentive to try they like. … That would be really can get out of that business.” In our data, to prevent very sick infants because if the we were able to follow the same women infant was sick, the cost of care would go bad for kids. So the really scary part over time, and we saw women being back to the state program. about the Supreme Court ruling is shifted from one hospital to another ei- that it could have the effect of undo- ther because the maternity service closed IMPACT OF THE or because the hospital would no longer AFFORDABLE CARE ACT ing a lot of the Medicaid expan- take Medicaid. sions for infants and children that I think that’s the most striking thing, Region: In this context, it was roughly a happened from the ’80s basically is how rapidly the hospitals responded month ago that the Supreme Court is- and how much they can change their sued its ruling on the Affordable Care through the middle of the ’90s. service mix to try and attract the type Act. Given this ruling, what is your sense of patients that are profitable. Also, it of the impact of the reform bill on health doesn’t really make very much difference care in the United States, specifically whether they’re private hospitals or pub- child health? negotiations over this bill, hospitals lic hospitals or for profit or not. Will this part of the “invisible safety agreed to give back money to Medicare net,” as your book calls it, become more on the understanding that there were Region: Yes, that surprised me a bit. You secure than it now is? Or does the deci- going to be many more people who had might expect different reactions from sion’s limit on federal powers over Med- health insurance, including Medicaid, private versus public providers. And icaid expansion by states mute that effec- so that the burden of providing indigent your 2007 study? tiveness? care would be reduced. Hospitals antici- pated that they would do at least as well Currie: On Medicaid managed care. The Currie: There are a bunch of different is- or better under the ACA than they had whole argument about managed care is sues with respect to children. The origi- been doing before. that if you have a patient and you have a nal legislation focused on extending Now, with the ruling, in a big state like capitated payment for that patient, then Medicaid to low-income, able-bodied Texas, for example, if the hospitals are you should want to be providing preven- adults. That mostly didn’t affect children getting less for Medicare and they don’t tive care to them so that you minimize because poor children are already cov- get the people coming in with health in- your costs down the road. ered up to age 19, and in a lot of states, surance, then they’re in big trouble. Hos- I think the problem with that argu- the children are covered up to 200 per- pitals may have been not very profitable ment from the point of view of Medicaid cent or even 300 percent of the poverty for a long time, so reducing their reve- is that there’s so much churning of pa- level. There might have been an indirect nues further could have negative effects tients on and off Medicaid that the com- effect on children through the workings on the provision of indigent care or care pany looks at you and instead of saying, of the whole system in that if hospitals to existing Medicaid patients, including “I should provide you good preventive ended up being more stable or being children. So that’s one way. care,” they say, “There’s a good chance more able to offer indigent care or some- But then a more direct threat, I would you’ll be gone in a couple years and not thing like that, then perhaps there would say, to children is that a number of states my problem, so I want to give you as lit- have been a spillover onto children. seem to be interpreting the ruling as say- tle as possible.” The Supreme Court ruling could have ing that the federal government can’t Added to that, in this particular case, several potential effects on children. One boss them around when it comes to was the fact that in California, they had is that if states choose not to participate Medicaid and they can change the provi- carve-outs out of the managed care con- in the Medicaid expansion for adults, sions of the program however they like. tracts. Carve-outs are things that don’t then hospitals are in big trouble. In the Maine has already thrown many thou-

13 September 2012 The Region

sands of 19-year-olds off their Medicaid WOMEN IN ECONOMICS program. There was also a headline to- day saying that 14 states were restricting Although there is a large literature Region: As you well know, women are the services covered under the Medicaid arguing that there is monopsony in underrepresented in economics, from program. the market for nurses, we did not see undergraduate to professional levels. States have many things they have This is a broad question, but what are the to cover, and then there are a bunch of any effect on nurse wages or em- impediments, trends and possible means things that are optional. States have al- ployment levels when a hospital was of addressing this inequality? ways had the right to cut back on the op- taken over by a chain. But nurses Your research on mentoring is of tional things. But it may be that they’re particular interest here, of course. Your taking this Supreme Court ruling to were expected to work harder after findings on the CeMENT program es- mean that they can challenge the federal the takeovers, in that they ended up tablished by the Amercian Economic government’s ability to mandate what with more patients per nurse. … Association’s Committee on the Status must be covered. And if that’s true, then of Women in the Economics Profession you could have essentially a rollback in The quality of the nurse labor force (CSWEP) suggested that mentoring many states of the Medicaid coverage may fall over time if wages stay could indeed have an impact on profes- that children have. That would be re- constant while the effort that is sional development. ally bad for kids. So the really scary part Have you or others been able to follow about the Supreme Court ruling is that it demanded rises. up on the results reported in 2010, which could have the effect of undoing a lot of I believe covered CeMENT participants the Medicaid expansions for infants and from 2004 to 2008, with a look at how children that happened from the ’80s ba- harder after the takeovers, in that they those and the January 2010 cohort have sically through the middle of the ’90s. ended up with more patients per nurse. fared? And my research suggests that would We couldn’t, in that paper, show that be really bad. there were direct effects on health, but it Currie: One of the main impediments seems likely that there might be because to women in economics is the same LABOR MARKETS IN many of the things that go wrong in hos- impediment for women in STEM [sci- U.S. HEALTH CARE pitals have to do not really so much with ence, technology, engineering and doctors, but with the quality of the nurs- mathematics] fields generally, and that Region: I’d like to ask about your paper ing care that people get. is an underrepresentation in math his- on hospital staffing and market struc- torically. Now perhaps that’s going to go ture in California, Cut to the Bone? Very Region: Do you have any sense of what away. I understand that for girls in high intriguing work. Could you summarize impact, therefore, current consolidation schools, test scores are now exceeding that study briefly and tell us what bear- trends in the United States might have on boys’ test scores in math as well as in ing it might have for the future of labor labor markets in health care? Of course, reading, whereas before it used to be markets in the U.S. health care industry? there’s huge demand for nurses now, and the reverse. there are many nursing strikes. So women have been catching up. Currie: We were looking at the big hos- But when they go to college, they still pital chains. One of the things that have Currie: There is a high demand for nurs- tend not to go into STEM fields and not been going on in the hospital market is es, but the quality of the nurse labor force to take mathematics. These days, if you that big chains like Tenet or HCA have may fall over time if wages stay constant don’t have any math background, it’s vir- been taking over hospitals. We wanted while the effort that is demanded rises. tually hopeless to try to do an economics to see how they reorganized the hospi- Also, a lot of schools that used to train Ph.D. program. You can’t even get off the tals when they took them over. What we RNs in four-year programs no longer starting block. I think that’s one issue. found was that they tended to change the do that; the nurses are being trained in Another issue is the whole work/ way that the hospital was staffed. community colleges with two-year de- family thing. The problem there is more Although there is a large literature grees. So you’re getting a different sort of societal than it is with academic em- arguing that there is monopsony in the person doing it. ployers. There are problems with aca- market for nurses, we did not see any ef- demic employers, and people think that fect on nurse wages or employment lev- Region: Less human capital. universities could do more, but by and els when a hospital was taken over by a large, a university is an incredibly flex- chain. But nurses were expected to work Currie: Exactly. ible workplace compared to most other

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One of the main impediments to women in economics … is an underrepresentation in math historically. … Women have been catching up. But when they go to college, they still tend not to take mathematics. … Another issue is the whole work/family thing. … Personally, I found that the major challenges had to do with [my children’s] schools. … The trends are, I think, slow—very slow—improvement over time.

workplaces. … Many departments re- Currie: Well, the trends are, I think, Now, the mentoring aspect is inter- ally do kind of bend over backwards to slow—very slow—improvement over esting in part because it’s such a small help people manage their work/family time. It takes an awfully long time for intervention. What we do in CeMENT issues. people to go through graduate school is to bring young female academics to- Personally, I found that the major and go through the hierarchy and be- gether for a couple of days at the end of challenges had to do with [my children’s] come full professors somewhere. the AEA convention. Women who ap- schools. Schools are always expecting ply are first grouped according to field, you to show up in the middle of the day Region: It’s a long pipeline. and then we randomly assign them and on very short notice, which is odd to be in the treatment or the control given that they are largely staffed by Currie: Yes, it is. I think role models are group. At the meeting, the women from working women themselves. They put important too. I know some women each field who are in the treatment pressure on mothers who are not able or don’t believe that, but personally, you group meet with a senior mentor and a willing to, say, show up with cupcakes on know, when [Harvard economist] Clau- junior mentor. And they are supposed short notice. dia Goldin visited when I was a graduate to submit a piece of work, which every- And it’s always the mom who is sup- student, that was tremendously influen- body in their group reads and discusses posed to do that. If you’re a dad and tial for me. I am not sure that Claudia with them. Other sessions deal with you do anything at the school, then herself believes in role models, but she work/life balance, the tenure process, you’re a hero, whereas if you’re a mom was a tremendous role model for me. I grant writing, the publication process and you don’t show up at least a couple think the lack of successful role models and other issues as well. of times a year, then you’re just a bad has been an issue, though that has cer- What we found in the initial evaluation mother. That kind of societal expecta- tainly changed with, for example, the was that there did seem to be a positive ef- tion is I think much more oppressive recent female Clark medalists, Susan fect of being in the program in terms of than most of what I experienced from Athey, Esther Duflo and Amy Finkel- publications and grants. Maybe you could my employers. stein. [See the interviews with Goldin say it was directly because of the interven- and Duflo in the September 2004 and tion. You know, you bring a piece of work, Region: And trends for women in eco- December 2011 Region, respectively, people look at it and then you’re more nomics? online at minneapolisfed.org.] likely to get your piece of work published.

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We are following up people over time. We don’t survey them, but we look for their CVs online and see how A lot of the early childhood they’re doing. I guess I’ll probably be doing that for the foreseeable future, research focus has shifted to trying to track down these cohorts ev- this possible link between health ery couple of years. Some of the anec- and educational outcomes. For dotal evidence was really very interest- ing about who benefits and why they example, there is the question benefited from it. Some women felt of whether kids are suffering very isolated. They often had no other from low birth weight or things woman to talk to. If they felt they had problems that their male colleagues related to low birth weight, and wouldn’t understand … maybe that’s what’s leading them to end up in special Region: Cupcake expectations. education. What are the things Currie: Yes, cupcakes. Then they that cause that? That’s some- would ask other members of their thing I’ve been spending group about that. Also, when they graduate, some people are better con- time on. nected than others, you know. One of the benefits of coming from an elite program is that you know people who also came from an elite program, so you tend to be better connected in the profession. If you don’t have that advantage, you may not have any EARLY CHILDHOOD EDUCATION Currie: Well, one thing is that I was very kind of group. We saw that people happy to learn that my initial results who were not as connected to begin Region: As you know, the Minneapolis seemed to hold up. with, or who had no women in their Fed has long been interested in the eco- departments, seemed to rely on the nomic impact of early childhood edu- Region: Always reassuring. group they were assigned to as a sort cation, and we were honored to have of peer group to discuss issues with you participate in our 2003 conference. Currie: There’s a paper by David Deming, and to get advice. [See “The ABCs of Early Childhood which uses the same research design as The mentors don’t actually get con- Development” in the December 2003 my early work on Head Start. [Deming, tacted a whole lot, but they often do get Region, online at minneapolisfed.org.] David. 2009. “Early Childhood Interven- contacted for advice about the really big At that time, you presented a paper on tion and Life-Cycle Skill Development: things like, “I’m putting together my the “black box” of Head Start—what Evidence from Head Start.” American tenure package. Should I include this or we knew at that time about what does Economic Journal: Applied Economics that?” Or “What should I say when they and doesn’t work in the Head Start 1 (July): 111-34. Online at people.fas. ask me about letter writers?” So it seems program. harvard.edu/~deming/papers/Deming_ like people gained access to an unbi- Your research suggested that more ex- HeadStart.pdf.] ased senior person who could help them pensive programs were more effective in But in the NLSY [National Longi- when it really counted. terms of gains in reading and vocabulary, tudinal Study of Youth] data you can I don’t know if it will ultimately play and that spending should focus more on now follow the children for much out in terms of a difference in tenure children and less on programs for par- longer. He looks at outcomes when rates, for example, which is the hope, be- ents and community development. they’re teenagers and finds gener- cause it is a quite small intervention. But What have we learned since then ally positive effects. There’s another I think it has had some positive effects about the impact of Head Start, specifi- paper by Pedro Carniero and Rita already. cally, and other ECE programs, more Ginja looking at Head Start using a generally? somewhat different research strategy,

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which finds positive effects on mental literally starved in utero had long-term health outcomes. The focus on mental effects. health in that paper is certainly an im- Economic studies are examining So economists have taken that idea portant new direction for research on and run with it. Economic studies are early childhood. I have been surprised a wide range of things that might examining a wide range of things that in my work on the longer-term effects affect fetal health and asking might affect fetal health and asking of mental health problems in child- whether they have long-term whether they have long-term conse- hood by how big the effects are rela- quences. I think there’s pretty broad tive to the effects of physical health consequences … and I raised the acceptance now of the idea that all problems. [Carneiro, Pedro, and Rita idea of “epigenetic” changes as kinds of things that happen when peo- Ginja. 2009. “Preventing Behavior one possibility. … Epigenetics ple are in utero seem to have a long- Problems in Childhood and Adoles- term effect. cence: Evidence from Head Start.” implies that it does not make One of the things I talked about in University College London. Online at sense to talk about nature versus my Ely lecture was what mechanism ucl.ac.uk/~uctprcp/headstart.pdf.] nurture. If nature is the gene and might underlie the long term effects, and I think a lot of the early childhood I raised the idea of “epigenetic” changes research focus has shifted to this pos- nurture is the thing that sets the as one possibility. The way I like to think sible link between health and educa- switches, then the outcome about that is you have the gene, which tional outcomes. For example, there is depends on both of those only changes very slowly when you have the question of whether kids are suf- mutations. But then kind of on top of fering from low birth weight or things things. the gene you have the epigenome, which related to low birth weight, and maybe determines which parts of the gene are that’s what’s leading them to end up in environments and their long-term effects expressed. And that can change within special education. What are the things on both mothers and children. one generation. There are animal experi- that cause that? That’s something I’ve Could you briefly review the fetal ments that do things like change the diet been spending time on, trying to look origins hypothesis and how economists of guinea pigs and all the baby guinea at whether pollution or stress or other have expanded its reach—to test scores, pigs come out a different color. It can be things during pregnancy might have education and income as well as health? pretty dramatic. an impact on health at birth, which would then lead to poorer educational Currie: I think the phrase itself was Region: So, far different, and far quicker, outcomes. coined by David Barker, a physician who than natural selection. was interested in whether there was a FETAL ORIGINS OF INEQUALITY biological mechanism such that if the fe- Currie: Yes, it’s a different mechanism, tus was starved in utero it would be more and it makes some sense from an evolu- Region: That certainly leads to your re- likely to be obese or more likely to have tionary perspective because it’s a way for search on fetal origins, so perhaps we heart disease or diabetes, things related populations to change rapidly when it’s could talk about that. Since your work to that in later life. The idea is that you necessary. The idea is that the fetal pe- with Rosemary Hyson in 1999, if not are sort of training the fetus to think this riod might be particularly important be- earlier, you’ve been exploring the long- is a hungry environment so that they cause these epigenetic switches are being term relationship between health and should be really thrifty with food. An in- set one way or another. And then once economic outcomes. fant programmed in this way would then they’re set, it’s more difficult to change In your 2011 Ely lecture to the AEA, be more likely to gain a lot of weight later them later on. you reviewed much of this research on and to have diseases related to obesi- I think we haven’t really been able to on determinants of health at birth and ty. So that was specifically what the fetal look at all of the implications of that giv- their link to adult outcomes, with new origin hypothesis was about. en the limitations of the data. We don’t evidence about in utero exposure to I believe Thalidomide was the first have very much data where we can fol- pollution. And you shed further light thing that really shocked people and low people from, say, in utero to some on mechanisms underlying perpetua- showed that if you give drugs to the later period. But, that’s where the fron- tion of poverty. woman, that it could have an effect tier is, trying to do that kind of research Recently, you’ve explored the eco- on the fetus. People were also working and make those linkages. What I’ve been nomic side of the fetal origins hypothesis. on the Dutch “Hunger Winter” prior able to do is to categorize a whole set of And you’ve been looking at early disease to Barker, looking into whether being things that have systematic impacts on

17 September 2012 The Region

the fetus. I’m really happy I didn’t know that the incidence of low birth weight any of these things when I was pregnant. was 8 percent higher for pregnant wom- Things we’re looking at here in en who are subjected to large amounts Region: How old are your kids? the United States, like the effects of auto exhaust because they live near of in utero exposure to pollution highway toll plazas. If that is true here, Currie: My kids are 12 and 15, so I didn’t then what must be the effect in Beijing? learn about any of this until afterwards. I on child health and economic out- It must be even bigger than that. would have been a nervous wreck! comes, involve problems that are Region: I think a really interesting thing about much worse in developing countries. Right, or other sorts of pollution the fetal origins hypothesis for public that you’ve looked at: toxic releases or policy is that if it’s really important what … If there are children in developing factory closings/openings, for instance. happens to the fetus, and some people countries who are damaged from Currie: think that maybe the first trimester is the the start because of the conditions Yes. So one thing I’m excited most important or the most vulnerable about is that people are starting to think period, then you’re talking about women they’re exposed to in utero, or in about these issues in developing coun- who might not even know that they’re early childhood, then that would tries. I think it’s really important in a pregnant. It really means you should be definitely be a drag on development. sense that if there are children in de- targeting a whole different population veloping countries who are damaged than, say, 15 years ago, when we thought, from the start because of the conditions oh, we need to be targeting preschool they’re exposed to in utero, or in early kids instead of kids once they reach childhood, then that would definitely be school age. Now we’re kind of pushing it THE NBER SUMMER INSTITUTE a drag on development. back. Then it was, “We need to be playing And conversely, another thing I was Mozart to infants.” Now the implication Region: One more question, about your thinking about is that you can have this is that we’ve got to reach these mothers work as director of the NBER’s Program kind of perverse selection effect. Suppose before they even get pregnant if we really on Families and Children. You’ve pulled conditions get better and children who want to improve conditions. together a number of papers that will be would have died now survive; if those Epigenetics implies that it does not presented here in Cambridge tomorrow. children are nevertheless unhealthy, make sense to talk about nature versus What key themes are you hoping will be then you could have mean health decline nurture. If nature is the gene and nurture covered at that session? And therefore, over the short term with development. is the thing that sets the switches, then what themes are you perhaps hoping to the outcome depends on both of those encourage in future economic research? Region: The human capital and health things. So you can’t really talk about na- I don’t know if that’s how you choose pa- care costs associated with that would be ture or nurture in most situations. It has pers but … enormous. to be some combination of both. Currie: Well, the way I choose papers is Currie: Right. So I think these are really Region: It just struck me that that con- that people submit them, and we had important issues in developing countries, trasts a bit from your early childhood an awful lot of papers submitted this and they’re starting to be addressed. So, education finding that you don’t want time, and then we just pick the ones that tomorrow, we have a number of papers to focus program spending on mothers seemed best. looking at Indonesia, Colombia and In- or parents. Focus on the kids, not on the But, indeed, some themes do seem to dia as well as one looking at the relation- moms. be emerging. One thing that is interest- ship between family size and children’s ing—and I’m starting to do a little bit of education across a large number of de- Currie: That’s true enough. I guess a work like this myself—is thinking about veloping countries. cynical view would be, “Well, if they’ve children in developing countries. Things Another of tomorrow’s papers that’s already had their kids, then there’s we’re looking at here in the United States, directly relevant to the discussion we no point, right? Quit worrying about like the effects of in utero exposure to have been having is by Bruce Meyer and them.” But many moms who have one pollution on child health and economic Laura Wherry about Medicaid expan- young child are likely to have another, outcomes, involve problems that are sions to teenagers. As I was saying, there so maybe that would be a good way to much worse in developing countries. were Medicaid expansions in the ’90s. target them. But in a different way than So if we can find an effect here … for Their study shows that black children they get targeted now. instance, my E-ZPass paper suggested who gained insurance coverage as pre-

September 2012 18 The Region

teens has lower future mortality rates. which is something I had also found. And there is more work on Head Start. Region: It’ll clearly be a very interesting Marianne Bitler, Thurston Domina and program tomorrow. Thank you so much. Hillary Hoynes are presenting a paper looking at distributional impacts of Head —Douglas Clement Start. Interestingly, they find larger effects July 25, 2012 for Hispanic children than other groups,

More About Janet Currie

Current Positions Honors and Awards Henry Putnam Professor of Economics and Public Affairs, Princeton Second Vice President, Society of Labor Economists, since May 2012; University, since 2011 Fellow, elected 2006 Director, Center for Health and Wellbeing, Princeton University, since 2011 Ely Lecturer, American Economic Association Meetings, January 2011 Director, Program on Families and Children, National Bureau of Economic Vice President, American Economic Association, 2010; Past Chair and Research, since 2002; Research Associate since 1995 Member, Honors and Awards Committee and Meetings Program Com- mittee Previous Positions Fellow, Center for Health and Wellbeing, UCLA, 2009-10, 2003-04 Sami Mnaymneh Professor of Economics, , 2009-11; Economics Department Chair, 2006-09; Professor of Economics, 2006-11 Research Fellow, Institute for the Study of Labor (IZA), 2003-14 Charles E. Davidson Professor of Economics, University of California at Los Fellow, Society of Labor Economics, elected May 2006 Angeles, 2005-06; Professor of Economics, 1996-2005; Associate Profes- Fellow, Canadian Institute for Advanced Research, 1997-99 sor, 1993; Assistant Professor, 1988 Fellow, UCLA Center for American Politics and Public Policy, 1994-95 Assistant Professor, Massachusetts Institute of Technology, 1991 Alfred P. Sloan Foundation Research Fellowship, 1993-95 Professional Affiliations Publications Editor, Journal of Economic Literature, since 2010; Associate Editor, Journal of Population Economics, since 2010; Associate Editor, Journal of Co-editor (with Robert Kahn) of The Future of Children: Children with Public Economics, since 2002; Member, Editorial Board, Quarterly Journal Disabilities and author of The Invisible Safety Net: Protecting the Nation’s of Economics, since 1995 Poor Children and Families and other books and articles focused on the health and well-being of children. Extensive research on early interven- Senior Research Affiliate, National Poverty Center, Gerald R. Ford School tion programs, health insurance programs, environmental hazards and of Public Policy, University of Michigan, since 2002 infant health, intergenerational transmission of health, education and Member, Board on Children, Youth and Families, Institute of Medicine, economic status, medical practice and health care systems, and labor since January 2012 negotiations. Member, Advisory Committee on Labor and Income Statistics, Statistics Education , since 2011 Princeton University, Ph.D., economics, 1988 Chair, Committee on Disclosure for Working Papers, National Bureau of , M.A., economics, 1983 Economic Research, 2011 University of Toronto, B.A., economics, Lorne T. Morgan Gold Medal in Member, Health Researcher of the Year Committee, Canadian Institutes of Economics, 1982 Health Research, 2011 Member, Advisory Panel, National Children’s Study, 2001-11

19 September 2012