The Effect of Purchasing Power of Supplemental Nutrition Assistance Program on Child Development Outcomes

Background. Despite the strong anti-poverty effects of the Supplemental Nutrition Assistance Program (SNAP) and the fact that children comprise the largest group of SNAP recipients, there have been very few quasi-experimental studies on the developmental benefits of SNAP, particularly in non-health outcomes, among young children. This area is important to further explore given that early childhood and early school years are critical developmental stages that are most sensitive to family income’s effects on child development (Smith, Brooks-Gunn, & Klebanov, 1997). This study contributes to this research gap by examining the plausibly causal effect of SNAP generosity on cognitive (i.e., early reading and math skills) and socioemotional development (i.e., teacher-reported approaches to learning, interpersonal, and externalizing behavior skills) among children in preschool to kindergarten-entry period.

Methods. Data comes from the Early Childhood Longitudinal Study – Birth Cohort. To address the endogeneity of SNAP benefit amounts, the current study draws on a novel measure of SNAP purchasing power (Bronchetti et al., 2019), an innovative method that has not been used in most SNAP research. Considering that the SNAP benefit formula is fixed across the contiguous U.S. – despite the significant variations in the local cost of living – there are substantial variations in the purchasing power (i.e., real value) of SNAP benefits across time and place. SNAP purchasing power is operationalized as the ratio of the maximum SNAP benefit for a family of four to the regional cost estimate of the Thrifty Food Plan. Using this purchasing power approach and a child fixed-effects model, this study employs within child variation in exposure to different levels of SNAP purchasing power over time.

Results. This study finds new evidence that greater purchasing power of SNAP benefits has positive effects on cognitive and socioemotional development, specifically early reading and early math skills as well as approaches to learning and externalizing behavior, among a high intent-to-treat sample (i.e., unmarried parents without a college degree). Findings from the mechanisms provide suggestive evidence that the positive effect of SNAP purchasing power on child development is likely driven by a reduction in maternal depressive symptoms and increases in daily reading time with the child. Results from robustness checks support that the study’s findings reflect the impact of SNAP generosity rather than that of variation in local food prices or living in a different labor market. Overall, this study shows that the nation’s largest income support policy helps reduce developmental gaps across socioeconomic status.

Implications. Findings are highly relevant to the current SNAP program. Overall, the child developmental benefits of the SNAP program, identified in this study, should be taken into account in the evaluation of the cost-effectiveness of any proposed budget cuts to the SNAP program. Also, the study suggests that policymakers should consider increasing SNAP benefit levels to account for the local cost of living (or, as an alternative, providing state-level SNAP supplements) to increase the effectiveness of SNAP in improving child development among low-income families.