Abstract

Estimation of Food Stamp Program (FSP) effects has been complicated by self-selection and by a contradiction between observed spending patterns and the economic theory of consumer choice. We developed a modified version of the traditional theory, in which participant households may be partly extramarginal even if they have some cash spending on at-home food. Using Current Population Survey (CPS) data for 2001–2005, we estimated Engel functions for at-home and away-from-home food spending for FSP participants and nonparticipants. Compared to nonparticipants with the same level of total income, participants had higher at-home food spending and lower away-from-home food spending.

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