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The Distinct Impact Of Food Stamps On Food Spending

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  • Wilde, Parke E.
  • Ranney, Christine K.

Abstract

The Southworth hypothesis predicts that inframarginal food stamp recipients should choose the same bundle of goods, whether they receive coupons or cash. Empirical research has contradicted this prediction. Here, we present a model that retains some attractive features of the Southworth hypothesis, while relaxing the key assumption that appears to be incorrect. In particular, we allow different forms of benefits to have distinct effects on desired, or unrestricted food spending. Two categories of previously commonly used empirical models are evaluated as special cases of our more general model. We estimate this model using data from two cash-out experiments.

Suggested Citation

  • Wilde, Parke E. & Ranney, Christine K., 1996. "The Distinct Impact Of Food Stamps On Food Spending," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 21(1), pages 1-12, July.
    • Handle: RePEc:ags:jlaare:31002
    DOI: 10.22004/ag.econ.31002
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    References listed on IDEAS

    as
    1. Herman M. Southworth, 1945. "The Economics of Public Measures to Subsidize Food Consumption," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(1), pages 38-66.
    2. Moffitt, Robert, 1989. "Estimating the Value of an In-Kind Transfer: The Case of Food Stamps," Econometrica, Econometric Society, vol. 57(2), pages 385-409, March.
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    4. Chavas, Jean-Paul & Yeung, M. L., 1982. "Effects of the Food Stamp Program on Food Consumption in the Southern United States," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 14(1), pages 131-139, July.
    5. Donald A. West & David W. Price, 1976. "The Effects of Income, Assets, Food Programs, and Household Size on Food Consumption," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 58(4_Part_1), pages 725-730.
    6. Ben Senauer & Nathan Young, 1986. "The Impact of Food Stamps on Food Expenditures: Rejection of the Traditional Model," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(1), pages 37-43.
    7. repec:mpr:mprres:1253 is not listed on IDEAS
    8. Mittelhammer, Ronald C. & West, Donald A., 1975. "Food Stamp Participation Among Low-Income Households: Theoretical Considerations Of The Impact On The Demand For Food," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 7(1), pages 1-9, July.
    9. Smallwood, David M. & Blaylock, James R., 1985. "Analysis Of Food Stamp Program Participation And Food Expenditures," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 10(1), pages 1-14, July.
    10. Murray, Michael P, 1994. "How Inefficient Are Multiple In-Kind Transfers?," Economic Inquiry, Western Economic Association International, vol. 32(2), pages 209-227, April.
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    Citations

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    Cited by:

    1. Robert Breunig & Indraneel Dasgupta, 2005. "Do Intra-Household Effects Generate the Food Stamp Cash-Out Puzzle?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(3), pages 552-568.
    2. Justine Hastings & Jesse M. Shapiro, 2018. "How Are SNAP Benefits Spent? Evidence from a Retail Panel," American Economic Review, American Economic Association, vol. 108(12), pages 3493-3540, December.
    3. Pender, John & Jo, Young & Miller, Cristina, 2015. "Economic Impacts of Supplemental Nutrition Assistance Program Payments in Nonmetro vs. Metro Counties," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205626, Agricultural and Applied Economics Association.
    4. Harkness, Joseph & Newman, Sandra, 2003. "The interactive effects of housing assistance and food stamps on food spending," Journal of Housing Economics, Elsevier, vol. 12(3), pages 224-249, September.
    5. Benjamin Schwab, 2020. "In the Form of Bread? A Randomized Comparison of Cash and Food Transfers in Yemen," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(1), pages 91-113, January.
    6. P. Wilde & C. Ranney, "undated". "A Monthly Cycle in Food Expenditure and Intake by Participants in the U.S. Food Stamp Program," Institute for Research on Poverty Discussion Papers 1163-98, University of Wisconsin Institute for Research on Poverty.
    7. Leschewski, Andrea M. & Weatherspoon, Dave D., 2017. "SNAP Household Food Expenditures Using Non-SNAP Payment Methods," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 259139, Agricultural and Applied Economics Association.
    8. Stewart, Hayden & Blisard, Noel, 2008. "Are Lower Income Households Willing and Able To Budget for Fruits and Vegetables?," Economic Research Report 56446, United States Department of Agriculture, Economic Research Service.
    9. Joseph Harkness & Sandra J. Newman, 2002. "The Interactive Effects of Housing Assistance and Food Stamps," JCPR Working Papers 272, Northwestern University/University of Chicago Joint Center for Poverty Research.
    10. Breunig, Robert & Dasgupta, Indraneel & Gundersen, Craig & Pattanaik, Prasanta, 2001. "Explaining The Food Stamp Cash-Out Puzzle," Food Assistance and Nutrition Research Reports 33869, United States Department of Agriculture, Economic Research Service.
    11. Lusk, Jayson L. & Weaver, Amanda, 2017. "An experiment on cash and in-kind transfers with application to food assistance programs," Food Policy, Elsevier, vol. 68(C), pages 186-192.
    12. Robert Breunig & Indraneel Dasgupta, 2003. "Welfare Transfers and Intra-Household Trickle Down: A Model with Evidence from the US Food Stamp Program," CEPR Discussion Papers 469, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    13. Rezgar Mohammed, 2020. "The Impact of Income on Household Expenditure on Dairy Products: Evidence from the United States Dairy Market," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 8(1), pages 16-23.
    14. Sudha Narayanan & Shree Saha, 2020. "Take home rations (THR) and cash transfers for maternal and child nutrition: A Synthesis of evidence in India," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2020-039, Indira Gandhi Institute of Development Research, Mumbai, India.
    15. Gentilini, Ugo, 2014. "Our daily bread : what is the evidence on comparing cash versus food transfers?," Social Protection Discussion Papers and Notes 89502, The World Bank.

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