Do Food Stamps Cause an Over-Consumption of Food? by

This paper analyzes the effects of the federal food stamp program on the consumption of food and the potential effects the incidence of obesity among food stamp recipients. Obviously, an effective food stamp program will lead to an increase in the consumption of food. However, if the food stamp program, because of the fixed quantity nature of its implementation, has led to an “over-consumption ” of food and increased incidence of obesity, then switching from a fixed quantity subsidy to a cash grant would reduce the incidence of obesity among the poor. To examine these issues, this paper starts with a theoretical analysis using a standard microeconomic model of consumer optimization to analyze the effects of a food stamp program on the consumption of food and the effect that switching from a food stamp program to a program that provides a cash grant has on food consumption. The paper then proceeds to examine data on the food stamp program and the incidence of obesity among various groups