The Effects of Minimum Wages on Food Stamp Enrollment and Expenditures

27 Pages Posted: 15 Sep 2015

See all articles by Michael Reich

Michael Reich

University of California, Berkeley - Department of Economics

Rachel West

Center for American Progress

Date Written: October 2015

Abstract

We provide the first causal analysis of how minimum wages affects enrollments and expenditures in the Supplemental Nutrition Assistance Program (SNAP). Exploiting state‐ and federal‐level variation in minimum‐wage policy between 1990 and 2012, and incorporating local controls in our specifications, we find that a 10 percent minimum wage increase reduces SNAP enrollment between 2.4 and 3.2 percent, and reduces program expenditures an estimated 1.9 percent. If the federal minimum wage were increased from $7.25 to $10.10, enrollment would fall between 7.5 and 8.7 percent (3.1 to 3.6 million persons) relative to 2012 levels, and annual expenditures would decrease 6 percent ($4.6 billion).

Suggested Citation

Reich, Michael and West, Rachel, The Effects of Minimum Wages on Food Stamp Enrollment and Expenditures (October 2015). Industrial Relations: A Journal of Economy and Society, Vol. 54, Issue 4, pp. 668-694, 2015, Available at SSRN: https://ssrn.com/abstract=2660536 or http://dx.doi.org/10.1111/irel.12110

Michael Reich (Contact Author)

University of California, Berkeley - Department of Economics ( email )

549 Evans Hall #3880
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Rachel West

Center for American Progress ( email )

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