Description: Department Seminar

Location: 368A Heady Hall

Contact: Rabail Chandio & Angelos Lagoudakis

Title: SNAP Recipients' Food Shopping Behavior under Unexpected Benefit Disbursement: Evidence from the 2018--2019 US Government Shutdown

Abstract: Participants in the Supplemental Nutrition Assistance Program (SNAP) display a cyclical spending pattern, with food expenditures peaking immediately after monthly benefit receipt. Yet it remains unclear how participants respond when benefits arrive earlier than expected. We exploit changes in the benefit disbursement schedule during the 2018–2019 government shutdown, which shifted February 2019 benefits into January, along with subsequent state-level adjustments in March and April, to study how early disbursements affect food purchasing behavior among program participants. Drawing on NielsenIQ consumer panel data and a difference-in-differences design, we show that the early disbursement of benefits led to a 7% reduction in February food spending among SNAP-eligible households and to a shift toward paying lower unit prices later in the month. The reduction in food spending was driven largely by cuts to spending on healthier food items as households reallocated  healthier purchases into late January. Heterogeneity analyses suggest that these spending effects were concentrated in states that issue benefits within the first week of the calendar month and in states with high program participation rates. We also show that households did not exhibit the typical post-disbursement spending spike following the early February benefit arrival; rather, the shorter interval between successive benefit payments helped smooth within-month expenditures and temporarily flatten the SNAP cycle. Finally, subsequent state-level schedule adjustments in March and April helped mitigate what would otherwise have been a sharp depletion in food expenditures during those months. We discuss policy implications related to benefit timing and adequacy during major program disruptions.