Pastor John MacArthur has written a very good book on this very subject. You can see the description HERE and read a great little article by Pastor MacArthur HERE. The answer he argues for (& I agree with him) is that babies and young infants instantly go to heaven. The main reasoning is this: Salvation is by grace, and condemnation is by works - most notably the action of rejecting God. Infants are incapable of rejecting or accepting God, and thus God chooses to extend His mercy to them. It is important to note that God saves them not on the basis of justice but on the basis of His grace.
Below is a video of Pastor MacArthur speaking about this very topic on CNN's Larry King Show.
