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Explaining The Food Stamp Cash-Out Puzzle

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Author Info
Breunig, Robert
Dasgupta, Indraneel
Gundersen, Craig
Pattanaik, Prasanta

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Abstract

Empirical studies have shown that food stamp participants spend a higher proportion of their benefit on food than they would with an equivalent amount of cash. Our study demonstrates that this result can be explained by the decision-making behavior of multi-adult households. Multi-adult households spend a higher proportion of their food stamp benefit than they would with an equivalent amount of cash. In contrast, single-adult households show little difference in food spending between food stamps and an equivalent amount of cash. Because over 30 percent of food stamp participants are in multi-adult households, switching from food stamps to cash may reduce food purchases of these needy households. If that is indeed the case, the use of food stamps and other in-kind benefits may be more desirable than other forms of assistance.

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File URL: http://purl.umn.edu/33869
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Publisher Info
Paper provided by United States Department of Agriculture, Economic Research Service in its series Food Assistance and Nutrition Research Reports with number 33869.

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Date of creation: 2001
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Handle: RePEc:ags:uersfa:33869

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Related research
Keywords: Food Stamp Program; cash transfers; cash-out puzzle; welfare stigma; Cournot model; intra-household distribution; Engel curves; Food Consumption/Nutrition/Food Safety; Food Security and Poverty;

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Wilde, Parke & Ranney, Christine, 1996. "The Distinct Impact Of Food Stamps On Food Spending," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 21(01), July. [Downloadable!]
  2. Lundberg, Shelly & Pollak, Robert A, 1993. "Separate Spheres Bargaining and the Marriage Market," Journal of Political Economy, University of Chicago Press, vol. 101(6), pages 988-1010, December. [Downloadable!] (restricted)
    Other versions:
  3. Alderman, Harold, et al, 1995. "Unitary versus Collective Models of the Household: Is It Time to Shift the Burden of Proof?," World Bank Research Observer, Oxford University Press, vol. 10(1), pages 1-19, February.
  4. Blackorby, Charles & Donaldson, David, 1988. "Cash versus Kind, Self-selection, and Efficient Transfers," American Economic Review, American Economic Association, vol. 78(4), pages 691-700, September. [Downloadable!] (restricted)
  5. Chiappori, Pierre-Andre & Haddad, Lawrence & Hoddinott, John & Kanbur, Ravi, 1993. "Unitary versus collective models of the household : time to shift theburden of proof?," Policy Research Working Paper Series 1217, The World Bank. [Downloadable!]
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  6. Dasgupta, Indraneel, 2001. "Gender-biased redistribution and intra-household distribution," European Economic Review, Elsevier, vol. 45(9), pages 1711-1722, October. [Downloadable!] (restricted)
  7. Besley, Timothy & Coate, Stephen, 1992. "Understanding welfare stigma: Taxpayer resentment and statistical discrimination," Journal of Public Economics, Elsevier, vol. 48(2), pages 165-183, July. [Downloadable!] (restricted)
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  8. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February. [Downloadable!] (restricted)
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  9. Wilde, Parke E & Ranney, Christine K, 2000. " The Monthly Food Stamp Cycle: Shopping Frequency and Food Intake Decisions in an Endogenous Switching Regression Framework," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 82(1), pages 200-213, February. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Atasoy, Sibel & Mills, Bradford F. & Mykerezi, Elton, 2008. "Intensity of Food Stamp Use and Transient and Chronic Poverty: Evidence from the Panel Study of Income Dynamics," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6541, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  2. Beth Osborne & Melvin Stephens, 2004. "The Relationship between Food Assistance, the Value of Food Acquired, and Household Food security," Working Papers 0408, Harris School of Public Policy Studies, University of Chicago. [Downloadable!]
  3. Nordström, Jonas & Thunström, Linda, 2007. "The Impact of Tax Reforms Designed to Encourage a Healthier Grain Consumption," UmeÃ¥ Economic Studies 717, Umeå University, Department of Economics. [Downloadable!]
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