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Levedahl's explanation for the cashout puzzle in the U.S. food stamp program: a comment

Breunig, Robert; Dasgupta, Indraneel


The “cashout puzzle” is an anomalous empirical regularity noted in studies of the Food Stamp Program, namely that the marginal propensity to consume food out of food stamps is much higher than that out of cash income for those households which spend some cash on food. See Fraker (1990) for a review. The receipt of food benefits in the form of stamps instead of cash does not constrain these households, hence, according to standard microeconomic theory (first considered for the case of food...[Show more]

CollectionsANU Research Publications
Date published: 2002
Type: Journal article


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