Rural versus Urban Areas and the Supplemental Nutrition Assistance Program

This study quantifies how spending changes induced by the Supplemental Nutrition Assistance Program (SNAP) affects production and employment in rural and urban areas. A general equilibrium simulation model with an estimated demand system is first used to project how SNAP affects spending on differen...

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Bibliographic Details
Published in:Agricultural and resource economics review 2020-12, Vol.49 (3), p.538-557
Main Authors: Weerasooriya, Senal A., Reimer, Jeffrey J.
Format: Article
Language:English
Subjects:
Agricultural economics
Contraction
Economic conditions
Economic sectors
Economic theory
Employment
Food stamps
Households
Income
Nutrition
Rural areas
Urban areas
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Summary:This study quantifies how spending changes induced by the Supplemental Nutrition Assistance Program (SNAP) affects production and employment in rural and urban areas. A general equilibrium simulation model with an estimated demand system is first used to project how SNAP affects spending on different goods and services. These impacts are then linked to the expansion and contraction of different economic sectors that differ in importance across rural and urban Oregon. In urban areas, a number of service sectors linked to higher-income households shrink slightly in response to SNAP, while food-related sectors expand; the net effect on jobs is slightly negative. Production changes in rural areas are generally smaller, while having a slightly positive net effect on jobs. Overall, SNAP makes a positive difference for low- or no-income households without strong effects elsewhere in the economy.
ISSN:1068-2805
2372-2614
DOI:10.1017/age.2019.28