United States Food Stamp Program

Rosso, R. 2001. Trends in Food Stamp Program Participation Rates 1994 to 1999. Alexandria, VA United States Department of Agriculture, Food and Nutrition Service. 

Retail Stores. Several programs deliver in-kind transfers to beneficiaries using food stamps or vouchers, for example, the public distribution system in India and the Food Stamp Program in the United States. Beneficiaries receive their allotted amount of food upon presenting the proper documents, namely, vouchers, passbooks, identity cards, or electronic cards. When the program uses cards, official ration shops or private retail shops can authorize or record the transactions using POS machines or terminals (described in box 5.13). 

Food stamp programs are often managed by the ministry of welfare as in Jamaica before 2002 or the ministry of agriculture as in the United States. Some countries use a combination of ministries, including the ministry of health as in the distribution of some of the benefits distributed by the Programa de Asignacion Familiar (Family Allowance Program) in Honduras. 

Fig. F-55. The mounting costs of the Food Stamp Program during the 1 980s. (Based on data from Statistical Abstract of the United States 1991, p. 371, Table 611)...

Provision of money or scrip to buy food— When a local supply of food is available, its sale through commercial channels may help to encourage local enterprises such as farming and marketing. However, the money or scrip may be used to purchase items other than food, as evidenced by abuses of the food stamp program in the United States (for example, their use to purchase liquor followed by their illicit redistribution at discounts). Furthermore, such doles to the able-bodied unemployed may lead to their rejection of employment when it is available. 

For example, I have discussed with associates in Japan their lifetime employment policies. As you know, the unemployment rate in Japan is normally less than 2% and when it exceeds this there is great concern. Some Japanese question their lifetime employment policy. It is my view that we in the United States have a lifetime employment system, however, the difference is that in Japan it is managed and controlled by the private sector, while in the United States it is managed and controlled, to a major extent, by the public sector through welfare programs, food stamps, etc. It takes little imagination to consider which is more costly to a society, both in terms of dollars or yen and, as important, in pride and utilization of the human resource. 

Cash transfers have been used effectively to address many of the needs of poor people. The intended beneficiaries include those who are poor and have a low level of consumption for a variety of reasons. Some households might simply have too few people working at wages that are too low, and therefore require additional support that can be provided by family allowances, common in Eastern Europe, and food stamps as in the United States. Other intended beneficiaries include households that do not have anyone who, due to age or disability, can be expected to work. These households can usually be reached with pensions as in Bangladesh and South Africa, family allowances, and food stamps. Cash programs can also provide temporary cash transfers to those who have suffered losses of assets, income, and/or consumption as a result of an uninsured shock for example, as has occurred in Indonesia, Mozambique, and Pakistan after natural disasters. See also box 7.3 on the effectiveness and flexibility of cash transfers in emergencies. 

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