SNAP Eligible Products and Behavioral Demand

60 Pages Posted: 1 Aug 2022 Last revised: 30 Aug 2023

See all articles by Christian Cox

Christian Cox

University of Arizona - Department of Economics

Katherine Harris-Lagoudakis

Iowa State University

Date Written: July 27, 2023

Abstract

This paper evaluates demand and nutrition when making unhealthy products, like soda, ineligible for purchase with Supplemental Nutrition Assistance Program (SNAP) benefits. We utilize policy variation in product eligibility for purchase with SNAP benefits to identify how eligibility contributes to differences in the marginal propensity to consume. Difference-in-Difference estimates suggest a 14 to 21 percent decline in soda purchases if soda was made ineligible for purchase with SNAP benefits. We then estimate a structural behavioral model that incorporates mental accounting to rationalize observed spending patterns. Our model predicts soda purchases would decline by 18 percent if soda were made ineligible for purchase with SNAP benefits. Our model simultaneously predicts that juice purchases would increase by 7 percent, resulting in an almost 7 percent decrease in total sugars purchased from beverages. These findings highlight the potential of modifying SNAP to promote healthier choices and improve public health.

JEL Classification: D12, I12, I18, I38, L66

Suggested Citation

Cox, Christian and Harris-Lagoudakis, Katherine, SNAP Eligible Products and Behavioral Demand (July 27, 2023). Available at SSRN: https://ssrn.com/abstract=4146549 or http://dx.doi.org/10.2139/ssrn.4146549

Christian Cox (Contact Author)

University of Arizona - Department of Economics ( email )

McClelland Hall
Tucson, AZ 85721-0108
United States

Katherine Harris-Lagoudakis

Iowa State University ( email )

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