Research also suggests that the size of the multiplier depends on economic conditions and the types of spending that take place. Previous research concludes that reasonable estimates for the government spending multiplier under general economic conditions range from 0.8 to 1.5, meaning that $1 of additional government spending increases GDP between $.80 and $1.50. The size of the multiplier for any kind of government assistance, or spending, depends on how much of the assistance is spent and on what. Higher SNAP Benefits Expand Spending on Food and Other Goods The expanded benefits would also boost income in the agriculture industries by $32 million. A recent ERS study examined the multiplier impact of a hypothetical $1 billion increase in SNAP benefits and found that this expansion of benefits during a slowing economy would increase Gross Domestic Product (GDP) by $1.54 billion and support 13,560 jobs, including nearly 500 agricultural jobs (farming, forestry, fishing, and hunting). This multiplier effect on the economy may extend well beyond the initial money provided to SNAP participants.Īlthough the multiplier theory is well known, the size of the multiplier from increased SNAP benefits is less clear. The impact of this increased spending by SNAP households “multiplies” throughout the economy as the businesses supplying the food and other goods-and their employees-have additional funds to make purchases of their own. As SNAP participants spend this increased Federal assistance, income is generated for those involved in producing, transporting, and marketing the food and other goods purchased by SNAP recipients. For example, during an economic downturn, when unemployment increases and wages fall, more individuals become eligible for SNAP and enroll in the program. The primary goal of SNAP is to provide low-income households with additional resources for buying food.īut SNAP also serves as an automatic stabilizer for the economy. In fiscal year 2018, SNAP served an average 40.3 million people per month and issued $60.9 billion in benefits to be spent in food stores authorized to accept SNAP benefits. USDA’s Supplemental Nutrition Assistance Program (SNAP) is the Nation’s largest food assistance program. agriculture industries and support an additional 480 full-time agriculture jobs. The $1 billion in new SNAP benefits would generate an additional $32 million in income for the U.S. Low-income participants in USDA’s Supplemental Nutrition Assistance Program (SNAP) generally spend their benefits soon after receiving them, spending that has cascading effects throughout the economy.Ī recent ERS analysis finds that during a slowing economy, $1 billion in new SNAP benefits would lead to an increase of $1.54 billion in Gross Domestic Product (GDP)-54 percent above and beyond the new benefits.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |