A Healthy Start for Healthy Start Vouchers?

Abstract

This paper examines the impact of a recent increase in the value of healthy start vouchers (HSV) on the purchase of healthy items, using a large and representative sample of 13 million shopping basket transactions from a major UK food retailer. We use a difference-in-differences (DiD) approach to show that a £1.15 increase in voucher values increased spending on fruits and vegetables (F&V) for single voucher users by 32p and for two voucher users by 77p. For all eligible items, the increase in the value of the vouchers increased spending by 31p for single voucher users and by 89p for two voucher users. Our analysis of the marginal propensity to consume (MPC) indicates that consumers treat vouchers similarly to cash transfers of the same value. We also find that the effects of the HSV program are greater in more deprived areas and areas with lower pre-change expenditure on eligible items, indicating potential benefits for reducing health inequalities. Our results have implications for the effectiveness of targeted benefit programs, such as the UK HSV program, in promoting healthy food choices.