Food Insecurity, SNAP Participation, and Alleviation of Hunger

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1 Food Insecurity, SNAP Participation, and Alleviation of Hunger Craig Gundersen University of Illinois Professor, Department of Agricultural and Consumer Economics Executive Director, National Soybean Research Laboratory

2 SNAP Primary goal The alleviation of food insecurity Two key questions To what extent does SNAP meet this goal? Are SNAP benefit levels sufficient to meet this goal?

3 Food min f min og Other Goods

4 Food min f min og Other Goods

5 Food min f min og Other Goods

6 Food Y/p f Y/p og Other Goods

7 Food (Y+SNAP)/p f Y/p f Y/p og Other Goods

8 Food (Y+SNAP)/p f Y/p f * Y/p og Other Goods

9 Food (Y+SNAP)/p f Y/p f Y/p og Other Goods

10 Food Insecurity Rates among SNAP Eligible Households Recipient Non-Recipient

11 Central Challenges in Evaluating Food Stamps Selection into food stamps A large proportion of eligible children do not receive food stamps Children are not randomly assigned to food stamps Measurement error In surveys, up to one-in-five food stamp recipients report that they do not receive food stamps

12 Previous work Addressing selection DePolt et al., 2009; Gundersen and Oliveira, 2001; Jensen, 2002; Mykerezi and Mills, 2010; Nord and Golla, 2009; Nord and Prell, 2010; Ratcliffe et al., 2011; Van Hook and Ballistreri, 2006; Wilde and Nord, 2005; Yen et al., 2008 Have generally found that SNAP leads to reductions in food insecurity Addressing measurement error Gundersen and Kreider, 2008 Higher rates of food insecurity of SNAP recipients are based on perhaps optimistic assumptions about degree of misreporting

13 Kreider et al., forthcoming Addressing Selection Relying on weaker assumptions Measurement error Central findings In comparison to a situation where no child receives SNAP, if all eligible children receive SNAP, the decline in food insecurity among households with children is at least 14.9 percentage points (when no misreporting) at least 8.1 percentage points (when misreporting within reasonable range)

14 Dollars Needed to be Food Secure To meet their weekly food needs, respondents in CPS are asked whether they would have to spend more less same If the answer is more or less, a question regarding how much more or less is asked See Gundersen and Ribar, 2011 for more details Normalize to put in per-capita format Limit sample to SNAP eligible households Food insecure households Those reporting that need more resources

15 Per-Capita Weekly Dollars Needed to be Food Secure Among SNAP Eligible Households Recipient Non-Recipient

16 Policy Implications SNAP is successful with respect to central goal, therefore major changes to structure should be approached with caution In particular, caution with respect to Switching to block grants Restricting purchases SNAP benefits are seemingly too low for at least some recipients May want to consider changes to benefit formula Raising minimum amount Changing relationship between net income and benefit levels

17 References DePolt R, Moffitt R, Ribar D. Food stamps, Temporary Assistance for Needy Families and food hardships in three American cities. Pacific Economic Review 2009;14(4): Gundersen C, Kreider B. Food stamps and food insecurity: What can be learned in the presence of nonclassical measurement error? Journal of Human Resources 2008;v43(2): Gundersen C, Oliveira V. The Food Stamp Program and food insufficiency. American Journal of Agricultural Economics 2001;84(3): Gundersen C, Ribar D. Food insecurity and insufficiency at low levels of food expenditures. Review of Income and Wealth 2011;57(4): Jensen H. Food insecurity and the Food Stamp Program. American Journal of Agricultural Economics 2002;84: Kreider B, Pepper J, Gundersen C, Jolliffe D. Identifying the effects of SNAP (food stamps) on child health outcomes when participation is endogenous and misreported. Journal of the American Statistical Association. Forthcoming. Elton M, Mills B. The impact of Food Stamp Program participation on household food insecurity. American Journal of Agricultural Economics 2010;92(5): Nord M, Golla A. Does SNAP Decrease Food Insecurity? Untangling the Self-Selection Effect. USDA, Economic Research Service, Economic Research Report No. (ERR-85) Nord, Mark M. and Mark M. Prell. Food Security Improved Following the 2009 ARRA Increase in SNAP Benefits. USDA, Economic Research Service, Economic Research Report No. (ERR-116) Ratcliffe C. McKernan S, Zhang S. How much does the Supplemental Nutrition Assistance Program reduce food insecurity. American Journal of Agricultural Economics 2011;93(4): Van Hook J, Stamper Balistreri K. Ineligible parents, eligible children: Food stamps receipt, allotments and food insecurity among children of immigrants. Social Science Research 2006;35(1): Wilde P, Nord M. The effect of food stamps on food security: A panel data approach. Review of Agricultural Economics 2005;27(3): Yen S, Andrews M, Chen Z, Eastwood D. Food Stamp Program participation and food insecurity: An instrumental variables approach. American Journal of Agricultural Economics 2008;90: