SNAP and Food Expenditures for SSI Recipients : Evaluating the Effects of California's Cash-out Policy

This paper investigates how Supplemental Nutrition Assistance Program (SNAP) eligibility and benefits affect food expenditures by exploiting the California 'cash-out' policy, which made Supplemental Security Income (SSI) recipients ineligible for SNAP. Using the Consumer Expenditure Survey, we find that after the California cash-out policy ended, affected SSI recipients increased their 'food at home' budget share by 2.5 to 4.3 percentage points ($120 to $206 per quarter). The cash-out effect on total food expenditures is dampened by a decrease in 'food away from home' and driven by extramarginal households. We use changes in SNAP benefits and SSI optional state supplements from 2003 to 2020 to compare the consumption of in-kind versus cash transfers and find an increase in SNAP benefits leads to a greater increase in food at home expenditures ($0.40 cents per $1) compared to SSI cash benefits ($0.15 cents per $1). These findings suggest that SNAP is effective in increasing food at home consumption among its lowest-income beneficiaries