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Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,The University of Tennessee,Agricultural Economics,*,Food Stamp Program Participationand Food Insecurity:,An Instrumental Variables Approach,Steven T.Yen,The University of Tennessee,Margaret Andrews,Economic Research Service,USDA,Zhuo Chen,The Centers for Disease Control,David B.Eastwood,The University of Tennessee,Overview,Food Stamp Program(FSP)is a major USDA food program.,Food insecurity(FI)is an important measure of welfare.,We investigate,relationship between FSP participation(binary)and FI(censored);,effects of policy/socio-demographic variables on FSP participation and FI.,2,Overview,Motivated by mixed results from previous studies:,insignificant/positive effects of FSP on FI;,insignificant/negative effect of FI on FSP;,inefficient 2-step estimates,Estimation by maximum-likelihood method(more efficient),Overview,Major findings:,FSP participation,decreases,FI,Also playing important roles in FSP&FI:,State-level policy variables,e.g.,EBT,short re-certification,Socio-demographic variables,e.g.,marital status,Being married reduces participation in FSP,Being married reduces FI,Introduction:USDA Food Programs,USDA implements 16 Food Assistance and Nutrition Programs,to provide low-income families and children with access to a healthy diet.,The 16 programs were funded at$42.9 billion in FY 2004.,1 in 5 Americans participated in one/more programs at some point each year.,Introduction:Food Insecurity in America,Most recent USDA food security survey indicates that,3.5%of U.S.households(3.8 million people)were food insecure with hunger;,7.6%(8.3 million people)were food insecure without hunger.,NFSPS sample(1996-97,“low-income):26.6%were food insecure during past 30 days.,Empirical Literature,Earlier studies of food insecurity addressed“food insufficiency.,Gunderson and Oliveira(2001),investigated food stamp participation and food insufficiency,using 19911992 SIPP panels;,used two-step estimator for simultaneous-equation probit(Mallar,1977).,Findings:,Mutual effects of FSP and FI are insignificant.,FSP participants had same probability of food insufficiency as non-participants.,Empirical Literature,More recent studies used data for FI.,Huffman and Jensen(2003),use the SPD data;,estimated,simultaneous-equation probit,also using Mallars(1977)procedure:,FS participation(0-1);,Labor-force participation(0-1);,food insecurity(0-1).,Findings,FI,decreases,FSP participation;,FSP participation does,not,affect FI,Empirical Literature,Jensen(2002)estimated the FSP participation(0-1)and food insecurity(0,1,2,3),in a 2-equation SUR system,Finding:FI and FSP“are affected in the same direction by random shocks or unmeasured effects.,(drawing on significant error correlation),Empirical Literature,Based on the 1995 and 1999 Food Security Supplements to the CPS,Nord(2001)found:households receiving food stamps registered almost no change in the measured prevalence of FI or hunger during the period.,Only one study has shown a clear positive association between FI and the use of public assistance.Borjas(2004)shows that a 10%cut in the fraction of the population that receives public assistance increased the percent of FI households by about 5%.,Empirical Literature,Kabbani and Yazbeck(2004)pooled multiple years of data from the CPS and,using a two-stage estimation procedure to control for the endogeneity of the program participation decision,Results suggest that participation in the FSP appears to moderate the observed differences for households with children aged 5 to 18,but not significantly.,Empirical Literature,Kabbani and Kmeid(2005),Logit analysis,Sample:CPS;,FSP-eligible,households that experienced hunger,during the year,Dependent variable(0-1):experienced hunger,during the last 30 days,Results:,FSP participation(0-1;exogenous)does,not,affect the odd of hunger,FSP,amount,(exogenous)significantly reduces the odd of,hunger,Empirical Literature,Apparent inconsistency among previous results suggests,that a more careful investigation between FSP participation&FI is needed.,This Study,Investigates,relationship between FSP and FI;,effects of socio-demographic variables on FSP and FI,using an instrumental variables approach.,This Study,NFSPS 1996-97 data offer a unique opportunity for such a pursuit:,include the 18 items of the,food security module,(used for annual monitoring of FI);,include follow-up questions that allow examination of FI status in the past 30 days;,variations in state-level variables:,EBT,adoption;,re-certification,periods,provide better instruments than those used in previous studies(except Kabbani and Wilde,2003;Kabbani and Yazbeck,2004,2005),This Study,Methodology:accommodates endogeneity of FSP in the FI equation,Results,FSP improves()FI.,Econometric Models,Econometric Models,Econometric Model,Data,National Food Stamp Program Survey(NFSPS),199697.,Low-income sample(below 150%of poverty threshold).,
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