Abstract
The Supplemental Nutrition Assistance Program (SNAP) issues monthly lump-sum payments. One potential benefit of SNAP payments is that they could ease liquidity constraints for participating households. Using novel retailer panel data, this is the first study to investigate the effect of SNAP on bulk purchasing behavior using within-household variation. To estimate a causal relationship between SNAP and bulk purchases, we use the timing of program re-certification as a source of exogenous variation in the decision to participate in SNAP. We find that participating in SNAP increases the expenditure share of bulk purchases for all groceries by six percentage points. Analyses aiming to disentangle whether increased bulk spending among SNAP households reflects an “income effect” or a “liquidity effect” point to the former, with spending patterns indicating “splurge behavior” rather than efforts to minimize prices.