Does Early Life Exposure to Cigarette Smoke Permanently Harm Childhood Health? Evidence from Cigarette Tax Hikes

Evidence suggests that excise taxes on tobacco improve fetal health. It remains unknown if smoke exposure causes lasting harm to children. I find that a one dollar increase in the state cigarette excise tax causes a 10% decrease in sick days from school, and a 4.5% decrease in the likelihood of having two or more doctor visits in the past 12 months. I find suggestive evidence for decreases in emergency room visits, hospitalizations, and asthma. This supports the hypothesis that in-utero exposure to smoking carries significant medium-term costs and excise tax policy can result in lasting intergenerational improvements in wellbeing.