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Changes in Low‐Income Households’ Spending and Time Use Patterns in Response to the 2013 Sunset of the ARRA‐SNAP Benefit

Jiyoon (June) Kim, Matthew Rabbitt () and Charlotte Tuttle

Applied Economic Perspectives and Policy, 2020, vol. 42, issue 4, 777-795

Abstract: We examine the effects of the 2013 Supplemental Nutrition Assistance Program (SNAP) benefit cut on households’ food expenditures, as well as other expenditure categories by analyzing data from the 2012–2014 Consumer Expenditure Survey (CEX). Making use of the short panel structure of the CEX, we employ difference‐in‐differences methods with household fixed effects. Results show that reduced SNAP benefits significantly decreased the food‐at‐home expenditure of SNAP households, but increased expenditure on used cars and public transportation. To further explore these findings, we use the American Time Use Survey (ATUS), where we find that SNAP households spent less time on food preparation, but more time on market work (both formal work and informal work) after the 2013 SNAP benefit cut. Our findings suggest that cutting program benefits by any level is immediately reflected in low‐income household's food expenditure. Our results also indicate that an increase in transportation expenditures correspond with the observed increase in labor supply for participant households. These reveal important information about the behaviors and coping strategies of low‐income households as they respond to a negative shock to their income.

Date: 2020
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