Working Paper

What Is the Economic Value of Improved Labor Market Outcomes from Infant Nutrition? The Case of Breastfeeding in the United States

Jul 6, 2016 | Marc Hafstead, Randall Lutter

Abstract

We seek to estimate the effects of breastfeeding on the present value of future earnings increases resulting from IQ increases. Using new estimates of the effect of cognitive performance on lifetime earnings in the United States, based on the National Longitudinal Survey of Youth, developed by Lin, Lutter, and Ruhm (2016) and new baseline estimates of the present value of lifetime earnings following methods of Grosse et al. (2002), we find that the expected value of increases in the present value of lifetime earnings from breastfeeding is about $20,000, assuming a 3 percent discount rate, with a 95 percent confidence interval from $2,900 to $38,700. If half of all US infants born each year were better breastfed, we estimate the total increase in the present value of future earnings to be $40 billion annually.