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The impact of SNAP work requirements on labor supply

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  • Han, Jeehoon

Abstract

This study explores the impact of work requirements for the Supplemental Nutrition Assistance Program (SNAP) on the labor supply of able-bodied adults without dependents, exploiting variation in the work exemption across areas over time as well as the age criteria for the work requirement. I find that suspending work requirements does not discourage employment; a decrease in employment of more than 1.4 percentage points among people who are potentially affected by the exemptions can be ruled out with a 95% confidence interval. I also find evidence of a reduction in hours of work among older prime-age workers due to the work exemption. Further analysis uncovers two reasons why the work exemption has little effect on employment. First, many new SNAP participants who enrolled due to the exemption are the long-term non-employed who have no labor supply to reduce. Second, the generous income deductions in benefit calculation act as a work incentive by significantly lowering the effective benefit reduction rate at very low income ($0–600). These findings indicate that the SNAP work requirement may not achieve the intended goal of promoting employment; instead it may increase the risk of disadvantaged individuals failing to receive the assistance they need.

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  • Han, Jeehoon, 2022. "The impact of SNAP work requirements on labor supply," Labour Economics, Elsevier, vol. 74(C).
    • Handle: RePEc:eee:labeco:v:74:y:2022:i:c:s092753712100124x
    DOI: 10.1016/j.labeco.2021.102089
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    1. Flores-Lagunes, Alfonso & Jales, Hugo B. & Liu, Judith & Wilson, Norbert L., 2023. "Moving Policies Toward Racial and Ethnic Equality: The Case of the Supplemental Nutrition Assistance Program," GLO Discussion Paper Series 1272, Global Labor Organization (GLO).

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    More about this item

    JEL classification:

    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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