We exploit the quasi-randomization of alcohol consumption created by state-level alcohol prohibition laws passed in the U.S. in the early part of the 20th century. Using a large dataset of World War II enlistees, we exploit the differential timing of these laws to examine their effects on adult height, educational attainment, and obesity. We find statistically significant effects for all three outcome variables that do not appear to be the result of pre-existing trends. Our findings add to the growing body of economic studies that examine the long-run impacts of in utero and childhood environmental conditions.

Since the 1970s, public health scholars have suggested that fetal alcohol exposure can lead to serious physical and cognitive problems that persist throughout a person’s life. More specifically, if a child suffers from fetal alcohol syndrome (FAS), the medical community is in general consensus that the child will exhibit significant growth deficits. There is also general agreement that FAS leads to a host of cognitive and behavioral problems. However, virtually all of these claims are based on observational studies whose conclusions may be driven by omitted variable bias, since it is likely that a mother’s drinking propensity is correlated with many other negative influences that can adversely affect a child’s development. For example, alcoholic mothers generally exhibit poor dietary choices and tend to receive less prenatal care than mothers who do not drink. We use a large dataset of US World War II enlistees to compare individuals conceived before and after the implementation of state-level alcohol prohibition laws to analyze whether these laws had an effect on height, the primary indicator used by doctors to diagnose fetal alcohol syndrome. This natural experiment provides an opportunity to strengthen the causal claims made about fetal alcohol exposure. We find that individuals conceived just after prohibition goes into effect are taller than individuals born in the preceding cohorts. This effect appears to be independent of any trends in height, and it is statistically significant. Though the identified effect size is modest, our results are likely to be an underestimate since some mothers likely did not drink even before prohibition and some may have continued even after alcohol sales became illegal.