Medium Run Impacts of Government Transfer Payments on Retail Prices and Welfare: Evidence from SNAP

and from comments by discussant J.P. Dubé. We thank our dedicated research assistants for their contributions. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. At least one co-author has disclosed a financial relationship of potential relevance for this research. Further information is available online at http://www.nber.org/papers/w23112.ack NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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“…The average coupon redeemed delivers savings of $1.01 in SNAP-eligible categories and $1.53 in SNAP-ineligible categories. 28…”

Section: Shopping Effortmentioning

confidence: 99%

How are SNAP Benefits Spent? Evidence from a Retail Panel

Hastings

Shapiro

2018

SSRN Journal

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“…Overall, the risk adjustment done prior to 2004 explained no more than 1.5 percent of the variation in medical spending (Brown et al 2014). 12 Extensive risk adjustment of MA capitation payments was introduced in 2004 (see Brown et al 2014;McWilliams, Hsu, and Newhouse 2012), after our study period.…”

Section: A Medicare Advantage Paymentsmentioning

confidence: 99%

“…14 Most of our analysis relies on publicly available administrative data on the MA program. We combine data from several sources: MA rate books, which list the 12 The purpose of this risk adjustment was not to correct for geographic variation in illness or utilization, which is fully captured in the local county average, but to address sorting between TM and MA. Following the prior literature, we focus solely on the demographic risk adjustment in our analysis.…”

Section: B Datamentioning

confidence: 99%

Do Larger Health Insurance Subsidies Benefit Patients or Producers? Evidence from Medicare Advantage

Cabral

Geruso

Mahoney

2018

American Economic Review

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A central question in the debate over privatized Medicare is whether increased government payments to private Medicare Advantage (MA) plans generate lower premiums for consumers or higher profits for producers. Using difference‑in‑differences variation brought about by a sharp legislative change, we find that MA insurers pass through 45 percent of increased payments in lower premiums and an additional 9 percent in more generous benefits. We show that advantageous selection into MA cannot explain this incomplete pass‑through. Instead, our evidence suggests that market power is important, with premium pass‑through rates of 13 percent in the least competitive markets and 74 percent in the most competitive.

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“…Panel A shows the evolution of SNAP benefits in administrative data (FNS 2015). Panel B shows the evolution of SNAP benefits and SNAP-eligible 33 The online Appendix shows that patterns similar to those in Figure 6 obtain for those SNAP adopters who exhibit a period of six consecutive non-SNAP months after initial exit from SNAP, for whom short-run "churn" off of and back on to SNAP (Mills et al 2014) is less likely to be a factor. Notes: Each figure plots coefficients from a regression of the dependent variable on a vector of indicators for the position of the current month in a monthly clock that begins in the most recent adoption month and resets every six months or at the next SNAP adoption, whichever comes first.…”

Section: Timing Of Program Exit Due To Certification Periodmentioning

confidence: 84%

“…Taking the ratio of these two values implies an MPCF out of SNAP benefits between 0.5 and 0.6, consistent with the evidence in Figure 5. 33 Legislated Benefit Changes.- Figure 7 plots the evolution of SNAP benefits and SNAP-eligible spending around the legislated benefit changes described in Section ID. Panel A shows the evolution of SNAP benefits in administrative data (FNS 2015).…”

Section: Timing Of Program Exit Due To Certification Periodmentioning

confidence: 99%

How Are SNAP Benefits Spent? Evidence from a Retail Panel

Hastings

Shapiro

2018

American Economic Review

155

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We use a novel retail panel with detailed transaction records to study the effect of the Supplemental Nutrition Assistance Program (SNAP) on household spending. We use administrative data to motivate three approaches to causal inference. The marginal propensity to consume SNAP-eligible food (MPCF) out of SNAP benefits is 0.5 to 0.6. The MPCF out of cash is much smaller. These patterns obtain even for households for whom SNAP benefits are economically equivalent to cash because their benefits are below their food spending. Using a semiparametric framework, we reject the hypothesis that households respect the fungibility of money. A model with mental accounting can match the facts. (JEL D12, H75, I12, I18, I38)

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Medium Run Impacts of Government Transfer Payments on Retail Prices and Welfare: Evidence from SNAP

Cited by 8 publications

References 44 publications

How are SNAP Benefits Spent? Evidence from a Retail Panel

How are SNAP Benefits Spent? Evidence from a Retail Panel

Do Larger Health Insurance Subsidies Benefit Patients or Producers? Evidence from Medicare Advantage

How Are SNAP Benefits Spent? Evidence from a Retail Panel

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