Federal Reserve Board research finds pandemic SNAP emergency allotments mostly increased food-at-home spending with an MPC around 0.5

The Federal Reserve Board published a FEDS Notes analysis of how Supplemental Nutrition Assistance Program (SNAP) “emergency allotments” during the pandemic affected household consumption. Using household receipt data, the note finds the extra SNAP benefits largely translated into higher food-at-home spending, with little to no measurable spillover into other spending categories, and estimates an average marginal propensity to consume (MPC) out of extra benefits of about 0.5. The analysis uses Numerator’s household-level panel of paper and digital receipts and identifies SNAP recipients based on benefit-card usage, focusing on households that received emergency allotments throughout March 2020 to February 2023 in the 32 states and three US territories that continued the allotments through that period. An event-study design associates emergency allotments with an average increase of about USD 150 in food-at-home spending over March 2020 to February 2023, implying an average MPC of 0.51 (median 0.53) when combined with aggregate benefit-per-household information. A difference-in-differences comparison against a constructed control group of SNAP-eligible non-recipients shows no meaningful pre-trends and indicates SNAP recipients spent about USD 100 more on food than the control group on average as the period progressed, while showing little change in other spending (including restaurants, clothing, health and beauty, and SNAP-ineligible grocery items). Item-level results suggest the largest relative increases within food categories were for meat products, fresh produce, and frozen products.