The kid is 4 days old.
I have noticed that tight swaddling DOES work in calming the kid down.
I wish to understand the reasons. Why does tight swaddling calm babies?
Answers with credible references will be appreciated.
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Dr. Harvey Karp, a peditrician, is one of the major proponents of swaddling today as exemplified in his "Happiest Baby on the Block" materials. You can read his reasoning here on BabyCenter. In terms of calming while awake, the thought is that swaddling helps to mimic the comfortable closed-in feeling of the womb. Karp has written extensively on swaddling and is considered a swaddling expert.
As for helping with sleep, as Dave Clarke mentioned, swaddling helps to contain the Moro reflex. The Moro reflex is a reaction to a falling sensation babies have when actually falling or placed on their backs. Babies will instinctively draw up their knees and flail their arms. Also newborns do not have good limb control and their limbs flail somewhat randomly for the first several weeks of life contributing to a wake-up. During the era of stomach-sleeping this flailing was controlled by the mattress, but since back-sleeping has been correlated with a decrease in the SIDS rate swaddling has been shown to help provide some - but many would anecdotally argue not all - of the same benefits.
Newborns do not move their arms and legs deliberately as we do, and do not always know they are doing that. A reflex or a reaction to a sound may result in a big leg kick or arm wave, and this can wake a sleeping baby or upset an awake one, much as you might be upset if you were lying in bed and someone else grabbed your leg, threw it up in the air, and then dropped it down on the bed.
When a baby is swaddled the twitchy jerky muscle firings may still happen, but the arms and legs don't wave around because the swaddling prevents it. This means the baby does not react with an angry "what just happened?" reaction and stays asleep or stays calm.
When they get older they learn how to move their limbs themselves and can be annoyed if that's prevented. Swaddling is a short term strategy - and a very good one.
Modern swaddling is becoming increasingly popular today as a means of settling and soothing irritable infants and helping babies sleep longer with fewer awakenings. Since the early 1990s the medical community has recommended placing babies on their back to sleep to reduce the risk of SIDS. As studies proved swaddled babies sleep better in the back sleeping position, swaddling has become increasingly popular and recommended so parents avoid the dangerous stomach sleeping position. Swaddling also prevents newborns waking themselves with their moro reflex.
Plenty of credible references can be found at the bottom of the wikipedia page.