Rising Food Prices Take a Bite Out of Food Stamp Benefits

Kenneth Hanson and Margaret Andrews

No 58624, Economic Information Bulletin from United States Department of Agriculture, Economic Research Service

Abstract: The Food Stamp Program is designed to provide low-income families with increased food purchasing power to obtain a nutritionally adequate diet. As in most other Federal Government assistance programs, benefits are adjusted in response to rising prices—in this case, rising food prices. The current method of adjustment results in a shortfall between the maximum food stamp benefit and the cost of a nutritionally adequate diet as specified by USDA’s Thrifty Food Plan. During fiscal year (FY) 2007, the food purchasing shortfall in the caseload-weighted maximum benefit for the program grew from $7 in October 2006 to $19 in September 2007. In FY 2008, the amount grew from almost $8 in October 2007 to $34 in July 2008 and to $38 in September 2008. In an average month, food stamp households faced shortfalls of over $2 in FY 2003, $12 in FY 2007, and $22 in FY 2008. These losses in food purchasing power account for 1 percent, 4 percent, and 7 percent of the maximum benefit in each respective year. Alternative adjustment methods can reduce the shortfall but will raise program costs.

Keywords: Consumer/Household Economics; Financial Economics (search for similar items in EconPapers)
Pages: 15
Date: 2008-12
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://ageconsearch.umn.edu/record/58624/files/eib41.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:uersib:58624

DOI: 10.22004/ag.econ.58624

Access Statistics for this paper

More papers in Economic Information Bulletin from United States Department of Agriculture, Economic Research Service Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().