Project: Effective Tax Rates and Guarantees and Food Stamp Program Participation
Award Year: 2005
Amount of award, fiscal 2005: $100,000.00
Institution: University of Kentucky
Principal Investigator: James Ziliak
Status: Completed
Detailed Objective: Concern has arisen about possible work-disincentive effects of Food Stamp Program (FSP) rules that impose high effective tax rates on families that choose to increase their work effort and about program actions that effectively reduce the level of program guarantees. The rules in question reduce actual benefits from cash transfers and from the FSP.

This study will address the following issues:

(1) Are there State-specific differences in effective FSP benefit guarantees and tax rates on income (reduction of benefits from an increase in income)? If so, have they changed since passage of the 1996 welfare reform act and 2002 Farm Bill?

(2) What impact do effective guarantees and tax rates have on the decision to participate in the FSP, given other macroeconomic conditions, policy parameters, and demographics?

(3) What effect do changes in effective guarantees and tax rates in the Temporary Assistance for Needy Families (TANF) program have on food stamp participation?

(4) To what extent is regional variation in FSP participation affected by the relative generosity of effective benefits and lower effective tax rates in the Food Stamp and TANF programs?

Topic: Program Operations, SNAP/Food Stamp Program
Dataset: Current Population Survey (CPS), Food Stamp Program Quality Control Data (FSPQC)