The Impact of a Child with Down Syndrome

We characterize the causal impact of having a child with Down syndrome relative to having one without Down syndrome using event studies around birth and population-wide Swedish administrative data from 1990 to 2019. The incremental effect of having a child with Down syndrome is to increase the likelihood of parental co-habitation and subsequent child-bearing. These effects exist both in an environment with essentially no prenatal testing – where the birth of a child with Down syndrome is random conditional on maternal age – as well as once prenatal screening and testing is more common. In both contexts, total income also increases due to the presence of a generous allowance for families with a child with a disability, but the impact on labor earnings differs. In the “no-testing” environment, having a child with Down syndrome leads to a greater decrease in maternal earnings post-birth relative to having a child without Down syndrome, but this effect reverses sign once testing is available. Our results speak to the impact on families of a child with Down syndrome in a setting where families are largely insured against any additional financial costs.