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The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides supplemental food, nutrition education (including breastfeeding promotion and support), and referrals to health care and other social services to low-income, nutritionally at-risk women, infants, and children up to 5 years of age. On average, over half of all infants in the United States, over a quarter of all pregnant and postpartum women, and over a quarter of all children less than 5 years of age participate in the program. The Healthy, Hunger-Free Kids Act of 2010, which authorized funds for WIC, is set to expire on September 30, 2015. The reauthorization process provides an important opportunity to reexamine the operation and effectiveness of the program and to consider improvements. This report explains how WIC works, examines program trends, and discusses some of the major economic issues facing the program (including the impact of economic conditions on participation, some lesser known effects of WIC, and equity and cost-management issues).

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is the major purchaser of infant formula in the United States. To reduce the cost of infant formula to WIC, Federal law requires that WIC State agencies operate a costcontainment system for the purchase of infant formula. Typically, WIC State agencies obtain substantial discounts in the form of rebates from the infant formula manufacturers for each can of formula purchased through the program. Contracts are awarded to the manufacturer offering the WIC State agency the lowest net price (as determined by the manufacturer’s wholesale price minus the rebate). A previous Economic Research Service study based on data through 2008 found that net prices were increasing, raising concern that this trend, if it continued, could constrain WIC’s ability to serve all eligible applicants in the future. This study, based on data through February 2013, allays that concern. Real net prices for contracts in effect in February 2013 decreased by an average 43 percent (or 23 cents per 26 fluid ounces of reconstituted formula) from the previous contracts. As a result, WIC paid $107 million less for infant formula over the course of a year, holding retail markup constant.

Children today are consuming close to 200 more calories a day from snacks than they did in the 1970s. Replacing a calorie-dense snack food with a fruit or vegetable could reduce calorie intake and improve diet quality. Swapping common snack foods with a ½-cup serving of fruits or vegetables can be done without compromising a household’s food budget.

Most Americans consume diets that do not meet Federal dietary recommendations. A common explanation is that healthier foods are more expensive than less healthy foods. To investigate this assumption, the authors compare prices of healthy and less healthy foods using three different price metrics: the price of food energy ($/calorie), the price of edible weight ($/100 edible grams), and the price of an average portion ($/average portion). They also calculate the cost of meeting the recommendations for each food group. For all metrics except the price of food energy, the authors find that healthy foods cost less than less healthy foods (defined for this study as foods that are high in saturated fat, added sugar, and/or sodium, or that contribute little to meeting dietary recommendations).

Federal dietary guidance advises Americans to consume more vegetables and fruits because most Americans do not consume the recommended quantities or variety. Food prices, along with taste, convenience, income, and awareness of the link between diet and health, shape food choices. We used 2008 Nielsen Homescan data to estimate the average price at retail stores of a pound and an edible cup equivalent (or, for juices, a pint and an edible cup equivalent) of 153 commonly consumed fresh and processed fruits and vegetables. We found that average prices ranged from less than 20 cents per edible cup equivalent to more than $2 per edible cup equivalent. We also found that, in 2008, an adult on a 2,000- calorie diet could satisfy recommendations for vegetable and fruit consumption in the 2010 Dietary Guidelines for Americans (amounts and variety) at an average price of $2 to $2.50 per day, or approximately 50 cents per edible cup equivalent.

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is the major purchaser of infant formula in the United States. To reduce cost to the WIC program, each State awards a sole-source contract to a formula manufacturer to provide its product to WIC participants in the State. As part of the contract, the WIC State agency receives rebates from the manufacturers. In this study, we use 2004-09 Nielsen scanner-based retail sales data from over 7,000 stores in 30 States to examine the effect of winning a WIC sole-source contract on infant formula manufacturers’ market share in supermarkets. We find that the manufacturer holding the WIC contract brand accounted for the vast majority—84 percent—of all formula sold by the top three manufacturers. The impact of a switch in the manufacturer that holds the WIC contract was considerable. The market share of the manufacturer of the new WIC contract brand increased by an average 74 percentage points after winning the contract. Most of this increase was a direct effect of WIC recipients switching to the new WIC contract brand. However, manufacturers also realized a spillover effect from winning the WIC contract whereby sales of formula purchased outside of the program also increased.

Replaced with revised version of poster 07/22/10.

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides participating infants with free infant formula. This study estimated that between 57 and 68 percent of all infant formula sold in the United States was purchased through WIC, based on 2004-06 data, and that formula costs to the WIC program have increased. Typically, WIC State agencies receive substantial rebates from manufacturers for each can of formula provided through the program. Each WIC State agency, or group of agencies, awards a contract to the manufacturer offering the lowest net wholesale price, defined as the difference between the manufacturer’s wholesale price and the State agency’s rebate. After adjusting for inflation, net wholesale prices increased by an average 73 percent for 26 fluid ounces of reconstituted formula between States’ contracts in effect in December 2008 and the States’ previous contracts. Most (72 percent) of the increase in real net wholesale prices was due to higher wholesale prices, the rest (28 percent) was due to lower rebates. As a result of the increase in real net wholesale prices, WIC paid about $127 million more for infant formula over the course of a year.

The mission of the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is to safeguard the health of low-income women, infants, and children through age 4 who are at nutritional risk. WIC provides nutritious foods to supplement diets, nutrition education, and referrals to health care and other social services. Administered by USDA’s Food and Nutrition Service (FNS), almost half of all infants and about a quarter of all children ages 1-4 in the United States participate in the program. WIC is USDA’s third-largest food and nutrition assistance program, accounting for 10 percent of total Federal spending on food and nutrition assistance. This report describes the WIC program—how it works, its history, program trends, and the characteristics of the population it serves. It also examines current issues facing WIC, focusing mainly on those with important economic implications.

Currently, the effects of the Food Stamp Program on the food choices and diet quality of participants are the subject of much debate. Improved evaluation of the nutrition and health effects of the program would be of use to program and policy officials, but most of the existing research is limited by three key factors: the difficulty in separating the effect of the program itself from other factors that may be related to program participation (that is, selection bias); relative age of the data (which do not capture current programs or population behaviors); and use of outdated dietary standards and assessment methods. This brief describes current ERS activities to address these problems and improve evaluation.

The Food Stamp Program provides benefits that low-income households can use to purchase food in grocery stores. The rise in obesity has raised the question of whether food stamp participants would purchase more healthy foods, such as fruits and vegetables, if food stamp benefits were higher. This report examines household food spending patterns and how they differ across income levels to provide insight into how participants might change their food spending in response to additional income.

Food stamp recipients, like other Americans, struggle with nutrition problems associated with choice of foods, as well as amounts. This series of Economic Information Bulletins compiles evidence to help answer the question of whether the Food Stamp Program can do more to improve the food choices of participants. It examines the role of affordability and price of healthful foods in influencing food choices and the likely success of any policy targeted at changing food choices through food stamp bonuses or restrictions. It also examines other approaches to changing food choices, including nutrition education and potential strategies drawn from behavioral economics literature. Meaningful improvements in the diets of food stamp recipients will likely depend on a combination of many tactics. Measuring the effect of any policy change on food choices and health outcomes remains a challenge.

The increased food purchasing power offered by the Food Stamp Program can promote food security and improve the overall economic well-being of low-income households. Now, as Americans struggle with obesity and other diet-related health problems, there is interest in whether the program can be more effective in encouraging participants to make healthy food choices. ERS has compiled economic research to provide decisionmakers with information on the likely effects of various proposed strategies for improving the food choices of food stamp program participants. This overview summarizes the findings, which are presented in more detail in a series of individual briefs.

The Nutrition and Health Characteristics of Low-Income Populations study examined several eating behaviors for children and adults using 1988-94 National Health and Nutrition Examination Survey (NHANES-III) data. This summary focuses on the nutritional biochemistry blood tests and bone density measures that showed differences between income groups. The measures provide a baseline to monitor eating behaviors of Americans, focusing on the low-income population.

The Nutrition and Health Characteristics of Low-Income Populations study examined several eating behaviors for children and adults using 1988-94 National Health and Nutrition Examination Survey (NHANES-III) data. The measures provide a baseline to monitor eating behaviors of Americans, focusing on the low-income population.

Many Americans do not consume the recommended amount of fruits and vegetables. Almost half of Americans think eating more fruits and vegetables would make their diets healthier, so why don't they? One argument is that fruits and vegetables are expensive, especially when purchased fresh. According to an ERS study, a consumer can meet the recommendation of three servings of fruits and four servings of vegetables daily for 64 cents.

Rebates from infant formula manufacturers to State agencies that administer the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) support over one-quarter of all WIC participants. However, concerns have been raised that WIC and its infant formula rebate program may significantly affect the infant formula prices faced by non-WIC consumers. This report presents findings from the most comprehensive national study of infant formula prices at the retail level. For a given set of wholesale prices, WIC and its infant formula rebate program resulted in modest increases in the supermarket price of infant formula, especially in States with a high percentage of WIC formula-fed infants. However, lower priced infant formulas are available to non-WIC consumers in most areas of the country, and the number of these lower priced alternatives is increasing over time.

The increasing popularity of dining out over the past two decades has raised the proportion of nutrients obtained from away-from-home food sources. Between 1977 and 1995, home foods significantly improved their nutritional quality, more so than away-from-home foods, which typically contained more of the nutrients overconsumed (fat and saturated fat) and less of the nutrients underconsumed (calcium, fiber, and iron) by Americans. Since the trend of eating out frequently is expected to continue, strategies to improve the American diet must address consumers' food choices when eating out. This report analyzes food intake survey data collected by USDA over the past two decades to compare the nutritional quality of home and away-from-home foods and examine how the quality has changed over time.

We use FDA surveys on awareness of diet-disease relationships to estimate a probability model of awareness. We apply the model to respondents of USDA's 1985-88 food consumption surveys to estimate a predicted probability of awareness, an explanatory variable in the multivariate analysis of fat intake. Despite systematic changes in food behavior associated with diet-disease awareness, women with higher awareness probabilities showed no greater reduction in fat intake than others. Difficulties in making effective food substitutions may be due to insufficient knowledge about the relative fat content of different food groups. More research is needed to understand the complex link between diet-disease awareness and dietary practices.

The results of this study suggest that, on a per person basis, female-headed households spend less for food than do similar two-parent households. The presence of a male head influences food expenditures less than household income and education level of the female head. Low income and low education levels are two characteristics associated· with female-headed households. Female-headed households constitute a growing proportion of the total population, particularly of the population receiving food assistance. Identifying the causes for lower food expenditures among female-headed households should help programs aimed at increasing food expenditures among female-headed households. Analysis of expenditure patterns among 15 food categories reveals that the factors that influence a household's decision to purchase a particular food category differ from the factors that influence the decision of how much to spend for that food category. For this reason, the tobit model is rejected, and a two-step decision model is recommended.