The Supplemental Nutrition Assistance Program (SNAP) is the largest nutritional safety net in the United States. Prior research has found that participants have higher consumption shortly after receiving their benefits, followed by lower consumption towards the end of the benefit month. This “SNAP benefit cycle” has been found to have negative effects on beneficiaries. We examine two behavioral responses of SNAP participants that may work in tandem to drive much of the cycle: short-run impatience – a higher preference to consume today; and fungibility of income – the degree of substitutability between a SNAP dollar and a cash dollar. Using data from the National Food Acquisition and Purchase Survey (FoodAPS), we find evidence of both behavioral responses. The degree of short-run impatience and fungibility of income is found to differ significantly across poverty levels and use of grocery lists to plan food purchases. Food purchase planning education could be used to counter the observed benefit cycle. Deeper analysis of the purchase data suggests that the benefit cycle is primarily associated with a decrease in the purchase of healthful and perishable foods—which could lead to lower dietary quality. We also find evidence that suggests households compensate for the effects of the SNAP benefit cycle by acquiring free food, primarily from schools. This highlights the importance of programs like the National School Lunch Program for SNAP households.
The Supplemental Nutrition Assistance Program (SNAP) is the cornerstone of food assistance in the United States. Begun as a small pilot known as the Food Stamp Program in 1963, today it reigns as one of the largest means-tested transfer programs in the social safety net, serving over 42 million persons in an average month during 2017, at a total annual cost of $68 billion. In 2013 UKPR co-organized a conference on the 50th anniversary of SNAP with the Institute for Research on Poverty and Brookings Institution, with the support of the Annie E. Casey Foundation, the Ford Foundation, and the Economic Research Service in USDA. The conference resulted in an edited volume published in 2015 called SNAP Matters: How Food Stamps Affect Health and Well Being. Among other things, the volume provides strong evidence that SNAP is highly responsive to macroeconomic pressures as well as to policy choices intended to enhance access among low-income households. As a result, it has become one of the most effective antipoverty programs overall, and is particularly effective at lifting non-elderly households with children out of deep poverty. As highlighted in the discussion papers below, UKCPR has also sponsored numerous additional studies on SNAP via its Research Program on Childhood Hunger, along with the FoodAPS, NHIS, and PSID research initiatives.
Higher food prices may aggravate household food insecurity and hurt diet quality. Using a sample of low-income households from the National Household Food Acquisition and Purchase Survey (FoodAPS), this study examines whether local food prices affect food insecurity and nutritional quality of foods acquired, and how households use competent consumer behaviors to mitigate any adverse effects of price. Financial management practices, nutrition literacy, and conscientious food shopping practices were considered for consumer competency. Our findings indicate that low-income households in higher-cost areas, regardless of whether they participate in SNAP or not, are more likely to adopt loyalty or other store savings programs than those in areas where food cost is relatively lower. Also, controlling for local food cost and various household characteristics, SNAP participants are more likely to use loyalty programs or other store savings, and are more likely to be aware of the dietary guidelines than nonparticipants. Our findings suggest that, although theoretically households could benefit from various consumer competencies and skills especially when the food cost is high, taking advantage of competent consumption strategies may be out of reach for many low-income consumers dealing with high food cost. Further, policies that incentivize competent or conscientious consumption among program participants might decrease food insecurity but likely at the expense of lowered nutritional quality of acquired foods, as long as less healthy food choices are also less expensive.
This paper examines the relationship between SNAP participation and prices paid for food items. To test this relationship, we develop an expensiveness index following the method of Aguiar and Hurst (2007) and use the FoodAPS data set. Using both the ordinary least squares method and controlling for endogeneity using an instrumental variables approach, we found SNAP participation did not hold a statistically significant relationship with the prices paid for food items when we controlled for consumer behavior and food market variables. This suggests that SNAP participants are not systematically disadvantaged in their food purchases. Additional efforts to further educate SNAP participants of effective shopping and budgeting habits may be fruitful in helping households pay comparatively lower food prices.
In this paper, we describe the relationship between SNAP and food consumption. We first present the neoclassical framework for analyzing in-kind transfers, which unambiguously predicts that SNAP will increase food consumption, and follow this with an explanation of the SNAP benefit formula. We then present new evidence from the Consumer Expenditure Survey on food spending patterns among households overall, SNAP households, and other subgroups of interest. We find that a substantial fraction of SNAP households spend an amount that is above the program’s needs standard. We also show that the relationship between family size and food spending is steeper than the slope of the SNAP needs parameter, and that large families are more likely than small families to spend less on food than the needs standard amount. Actual benefit levels are smaller than the needs standards, and we find that most families spend more on food than their predicted benefit allotment. Because of this, according to the neoclassical model, most families are predicted to treat their benefits like cash.
Receipt of benefits from other traditional transfer programs by SNAP families is common, with 76 percent of those families receiving at least one other major benefit of that type, excluding Medicaid, in 2008. However, over half of these only received one other benefit and only a very small fraction received more than two others. Over the long-term, multiple benefit receipt among SNAP families has been falling, a result of declines in the TANF caseload offsetting rises in the SSI, SSDI, and WIC caseloads. Finally, the analysis shows that high marginal tax rates generated by multiple program receipt are relevant for only a small portion of the TANF caseload, namely, the portion of the caseload that is nondisabled, nonelderly, and have earnings in the phaseout regions of the programs where marginal tax rates are high. The vast majority of SNAP families are not affected and, indeed, most have sufficiently low earnings that they face negative cumulative marginal tax rates.
Much of the evidence about the effects of SNAP on nutrition is based on cross-sectional studies comparing SNAP recipients and eligible non-recipients, and thus potentially biased, even when observables are controlled. There is evidence suggesting SNAP recipients spend more on food than other similar families and that they have higher nutrient availability than others. The lack of good causal evidence is in part due to the many challenges with evaluating what was for most of its life a national program with consistent rules across places, making it impossible to use the most common quasi-experimental estimators. There is also the challenge that any of these comparisons of recipients and non-recipients in standard data sets suffer from misclassification, as SNAP use is underreported. The goal of this paper is to assess the existing state of knowledge about whether SNAP improves health and nutrition outcomes, and if so, which ones and by how much.
This chapter reviews recent theory and empirical evidence regarding the effect of SNAP on food insecurity and replicates the modelling strategies used in the empirical literature. The authors find that recent evidence suggesting an ameliorative effect of SNAP on food insecurity may not be robust to specification choice or data. Most specifications mirror the existing literature in finding a positive association of food insecurity with SNAP participation. Two-stage least squares and control function methods do show that SNAP reduces food insecurity, but effects are not consistent across sub-populations and are not always statistically significant.
The Great Recession and its immediate aftermath have brought increasing attention both to food insecurity among children and to the associated food safety net. This chapter examines how SNAP functions as a component of the broader food assistance safety net for school-age children, focusing on connections between SNAP and the school meal programs at a policy level, as well patterns in children’s participation across programs. Food assistance programs are a mainstay of children’s overall household resources. Nearly half of children used at least one, often more, during any 4-month period; and for an average low-income child, food assistance comprised almost one-fifth of total household food and nonfood resources, a figure that rises to 35 percent of resources among children who participate in all three programs. While there is a substantial degree of overlap among programs, there is nonetheless considerable variation in the ways children access and package programs, both cross-sectionally and over time.
The SNAP program cost one half of one percent, according to a 2013 estimate by Robert Moffitt. For that amount we get a 16 percent reduction in poverty (8 million fewer poor people) after an adjustment for underreporting, based on USDA Administrative data. Moreover we get a 41 percent cut in the poverty gap, which measures the depth of poverty and a 54 percent decline in the severity of poverty, when we add SNAP benefits to Census money incomes and recalculate the official poverty rate.
One in seven Americans received assistance from SNAP in FY 2012, which is a rate 141 percent higher than in FY 2000, but only 59 percent higher than in FY 1980. In this paper, I describe the socioeconomic and policy climate in recent decades that had bearing on SNAP participation, along with a formal empirical analysis of those determinants and detailed simulations of the relative contributions of the economy, policy, and demographics to changes in SNAP participation over time. The results suggest that SNAP is operating effectively as an automatic fiscal stabilizer—nearly 50 percent of the increase in participation from 2007-2011 is due to the weak economy—but policy reforms expanding access and benefit generosity also affected participation, accounting for nearly 30 percent of the increase after the Great Recession. The changing demographics of the American household are helping restrain growth in SNAP.