Low birth weight infants born to mothers with low educational attainment have a double hurdle to overcome in the production of human capital. We examine whether income transfers in the form of Supplemental Security Income (SSI) payments for children with disabilities can help close the gap in outcomes due to this initial health and environmental disadvantage. We exploit a discontinuity in SSI eligibility at 1200 grams and use a regression discontinuity approach to produce causal estimates of the effects of SSI eligibility. We find that eligibility increases disability benefit participation, improves child outcomes and parenting behaviors, and shifts maternal labor supply from full to part time.
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