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Abstract

Although the United States has one of the highest standards of living in the world, nearly 15 percent of all households and 39 percent of near-poor households were food insecure in 2008. The Supplemental Nutrition Assistance Program (SNAP, formerly called the Food Stamp Program) is the cornerstone of federal food assistance programs and serves as the first line of defense against food-related hardship, such as food insecurity. Using the 1996, 2001, and 2004 Survey of Income and Program Participation (SIPP) panels, this paper measures SNAP’s effectiveness in reducing food insecurity using a dummy endogenous variable model with instrumental variables to control for selection bias. Recent changes in state SNAP policies and rules provide exogenous variation, which we use to control for selection into the program. Results from naïve models that do not control for the endogeneity of SNAP receipt show that SNAP receipt is associated with higher food insecurity. However, instrumental variable models that control for the endogeneity of SNAP receipt suggest that SNAP receipt reduces the likelihood of being food insecure by roughly 30 percent and reduces the likelihood of being very food insecure by 20 percent. These findings provide evidence that SNAP is meeting its key goal of reducing food-related hardship.

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