The persistence of healthy behaviors in food purchasing

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When some healthy foods are temporarily subsidized, how does that affect diet and how long does the impact last? I study the U.S. Special Supplemental Nutrition Program for Women, Infants, and Children, which gives vouchers for healthy foods. Using household-level scanner data and exploiting a reform of the program, first, I find that the subsidies make diet healthier. The effect is driven by increased purchases of subsidized products without sizable externalities on other product categories. Second, there is little evidence of a long-term impact on food purchases—when households become ineligible, the effect of the program diminishes. Third, demand model estimates show that in the first years after the end of eligibility, households are still more likely to prefer the previously subsidized products. The estimates imply that price differences between healthy and unhealthy foods play a large role in the decrease in the program’s impact.