Issuance and Incidence : Snap Benefit Cycles and Grocery Prices

Many safety-net programs issue benefits as monthly lump-sum payments. We investigate how the timing of Supplemental Nutrition Assistance Program (SNAP) benefit issuance affects food purchases and the incidence of the transfer. Using retail scanner data from a large sample of grocery stores and state and time variation in SNAP issuance schedules, we document large, SNAP-induced intra-month cycles in food expenditures. However, we find that retailers do not adjust prices based on these predictable patterns of demand. Our results therefore suggest that reforming issuance schedules reduce costs from SNAP-induced demand surges but are unlikely to affect the incidence of SNAP benefits