Hand to Mouth: Financial Stress and Food Insecurity
54 Pages Posted: 8 Mar 2020 Last revised: 20 Apr 2020
Date Written: February 11, 2020
We link consumer credit bureau data to data on household demographics and consumption choices. We show that financial stress changes consumers’ consumption patterns. Not only does financial stress change how and where consumers shop, but it also affects the types and quality of food they buy. Consumers exhibit a dramatic shift toward purchasing cheap, high-calorie foods during times of high financial distress, which we interpret as a manifestation of food insecurity. Families with children are especially sensitive and respond more sharply to financial stress. Our results offer policy implications for targeted interventions.
Keywords: Financial Stress, Consumption, Personal Finance, Food Insecurity
JEL Classification: D1, L81, I1, I31
Suggested Citation: Suggested Citation