Consumption responses to in-kind transfers: Evidence from the introduction of the food stamp program

Hilary W. Hoynes*, Diane Whitmore Schanzenbach

*Corresponding author for this work

Research output: Contribution to journalArticle

123 Scopus citations

Abstract

Economists have strong theoretical predictions about how in-kind transfers, such as providing vouchers for food, impact consumption. Despite the prominence of the theory, there is little empirical work on responses to in-kind transfers, and most existing work fails to support the canonical theoretical model. We employ difference-indifference methods to estimate the impact of program introduction on food spending. Consistent with predictions, we find that food stamps reduce out-of-pocket food spending and increase overall food expenditures. We also find that households are inframarginal and respond similarly to one dollar in cash income and one dollar in food stamps.

Original languageEnglish (US)
Pages (from-to)109-139
Number of pages31
JournalAmerican Economic Journal: Applied Economics
Volume1
Issue number4
DOIs
StatePublished - Oct 1 2009

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ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

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