IDEAS home Printed from https://ideas.repec.org/a/sae/urbstu/v55y2018i14p3234-3251.html
   My bibliography  Save this article

Supply-side subsidies to improve food access and dietary outcomes: Evidence from the New Markets Tax Credit

Author

Listed:
  • Matthew Freedman

    (University of California Irvine, USA)

  • Annemarie Kuhns

    (US Department of Agriculture, Economic Research Service, USA)

Abstract

In an effort to improve diet and health outcomes, policymakers have increasingly turned to supply-side subsidies aimed at encouraging investment by supermarkets and other food retailers in low-income areas. This article examines whether the US federal government’s New Markets Tax Credit (NMTC) has affected the entry of retail food establishments, and in turn food shopping and purchasing patterns, in low-income communities. To identify the impacts of the programme, we take advantage of a discontinuity in NMTC funding generated by the formula used to determine the eligibility of census tracts for investment under the programme. We find that the NMTC Program has had modest, but positive impacts on supermarket entry in low-income communities. Based on household-level scanner data, there are no detectable effects on households’ food purchasing patterns in affected neighbourhoods, at least in the short run.

Suggested Citation

  • Matthew Freedman & Annemarie Kuhns, 2018. "Supply-side subsidies to improve food access and dietary outcomes: Evidence from the New Markets Tax Credit," Urban Studies, Urban Studies Journal Limited, vol. 55(14), pages 3234-3251, November.
    • Handle: RePEc:sae:urbstu:v:55:y:2018:i:14:p:3234-3251
    DOI: 10.1177/0042098017740285
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0042098017740285
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0042098017740285?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Dave Weatherspoon & James Oehmke & Assa Dembélé & Marcus Coleman & Thasanee Satimanon & Lorraine Weatherspoon, 2013. "Price and Expenditure Elasticities for Fresh Fruits in an Urban Food Desert," Urban Studies, Urban Studies Journal Limited, vol. 50(1), pages 88-106, January.
    2. Neil Wrigley, 2002. "'Food Deserts' in British Cities: Policy Context and Research Priorities," Urban Studies, Urban Studies Journal Limited, vol. 39(11), pages 2029-2040, October.
    3. Muth, Mary K. & Sweitzer, Megan & Brown, Derick & Capogrossi, Kristen & Karns, Shawn A. & Levin, David & Okrent, Abigail & Siegel, Peter & Zhen, Chen, 2016. "Understanding IRI Household-Based and Store-Based Scanner Data," Technical Bulletins 234905, United States Department of Agriculture, Economic Research Service.
    4. Rebecca Taylor & Sofia B. Villas-Boas, 2016. "Food Store Choices of Poor Households: A Discrete Choice Analysis of the National Household Food Acquisition and Purchase Survey (FoodAPS)," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 98(2), pages 513-532.
    5. Daniel Hanner & Daniel Hosken & Luke M. Olson & Loren K. Smith, 2015. "Dynamics in a Mature Industry: Entry, Exit, and Growth of Big‐Box Grocery Retailers," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 24(1), pages 22-46, March.
    6. Cutler, David M. & Lleras-Muney, Adriana, 2010. "Understanding differences in health behaviors by education," Journal of Health Economics, Elsevier, vol. 29(1), pages 1-28, January.
    7. Freedman, Matthew, 2015. "Place-based programs and the geographic dispersion of employment," Regional Science and Urban Economics, Elsevier, vol. 53(C), pages 1-19.
    8. Daniel S. Hosken & Luke M. Olson & Loren K. Smith, 2016. "Can Entry Or Exit Event Studies Inform Horizontal Merger Analysis? Evidence From Grocery Retailing," Economic Inquiry, Western Economic Association International, vol. 54(1), pages 342-360, January.
    9. Jessie Handbury & Ilya Rahkovsky & Molly Schnell, 2015. "Is the Focus on Food Deserts Fruitless? Retail Access and Food Purchases Across the Socioeconomic Spectrum," NBER Working Papers 21126, National Bureau of Economic Research, Inc.
    10. Neil Wrigley & Daniel Warm & Barrie Margetts, 2003. "Deprivation, Diet, and Food-Retail Access: Findings from the Leeds ‘Food Deserts' Study," Environment and Planning A, , vol. 35(1), pages 151-188, January.
    11. Richard Volpe & Abigail Okrent & Ephraim Leibtag, 2013. "The Effect of Supercenter-format Stores on the Healthfulness of Consumers' Grocery Purchases," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(3), pages 568-589.
    12. Kaitlyn Harger & Amanda Ross, 2016. "Do Capital Tax Incentives Attract New Businesses? Evidence Across Industries From The New Markets Tax Credit," Journal of Regional Science, Wiley Blackwell, vol. 56(5), pages 733-753, November.
    13. ver Ploeg, Michele & Breneman, Vince & Farrigan, Tracey & Hamrick, Karen & Hopkins, David & Kaufman, Phillip & Lin, Biing-Hwan & Nord, Mark & Smith, Travis A. & Williams, Ryan & Kinnison, Kelly & Olan, 2009. "Access to Affordable and Nutritious Food: Measuring and Understanding Food Deserts and Their Consequences: Report to Congress," Administrative Publications 292130, United States Department of Agriculture, Economic Research Service.
    14. Freedman, Matthew, 2012. "Teaching new markets old tricks: The effects of subsidized investment on low-income neighborhoods," Journal of Public Economics, Elsevier, vol. 96(11), pages 1000-1014.
    15. McCrary, Justin, 2008. "Manipulation of the running variable in the regression discontinuity design: A density test," Journal of Econometrics, Elsevier, vol. 142(2), pages 698-714, February.
    16. Douglas J. Besharov & Marianne Bitler & Steven J. Haider, 2011. "An economic view of food deserts in the united states," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 30(1), pages 153-176, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Minjee Kim, 2022. "How do tax-based revitalisation policies affect urban property development? Evidence from Bronzeville, Chicago," Urban Studies, Urban Studies Journal Limited, vol. 59(5), pages 1031-1047, April.
    2. Brett Theodos & Christina Stacy & Daniel Teles & Chris Davis & Ananya Hariharan, 2022. "Place‐based investment and neighborhood change: The impacts of New Markets Tax Credits on jobs, poverty, and neighborhood composition," Journal of Regional Science, Wiley Blackwell, vol. 62(4), pages 1092-1121, September.
    3. Ayse Nilgun BALAS & Halil Dincer KAYA, 2019. "The Impact of Global Crisis on the Subsidies PAID to Retailers and Wholesalers in Eastern European and Central Asian Countries," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 20(1), pages 14-29, March.
    4. Alyssa J. Moran & Yuxuan Gu & Sasha Clynes & Attia Goheer & Christina A. Roberto & Anne Palmer, 2020. "Associations between Governmental Policies to Improve the Nutritional Quality of Supermarket Purchases and Individual, Retailer, and Community Health Outcomes: An Integrative Review," IJERPH, MDPI, vol. 17(20), pages 1-23, October.
    5. Sean Clark, 2020. "Financial Viability of an On-Farm Processing and Retail Enterprise: A Case Study of Value-Added Agriculture in Rural Kentucky (USA)," Sustainability, MDPI, vol. 12(2), pages 1-16, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Steele, Marie E. & Weatherspoon, Dave D., 2017. "A Theoretical Approach to Supermarket Chain Investment in Urban Food Deserts," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258202, Agricultural and Applied Economics Association.
    2. Jessie Handbury & Ilya Rahkovsky & Molly Schnell, 2015. "Is the Focus on Food Deserts Fruitless? Retail Access and Food Purchases Across the Socioeconomic Spectrum," NBER Working Papers 21126, National Bureau of Economic Research, Inc.
    3. Freedman, Matthew & Khanna, Shantanu & Neumark, David, 2023. "Combining rules and discretion in economic development policy: Evidence on the impacts of the California Competes Tax Credit," Journal of Public Economics, Elsevier, vol. 217(C).
    4. Chenarides, Lauren & Jaenicke, Edward C., 2016. "Store Choice and Consumer Behavior in Food Deserts: An Empirical Application of the Distance Metric Method," 2017 Allied Social Sciences Association (ASSA) Annual Meeting, January 6-8, 2017, Chicago, Illinois 250118, Agricultural and Applied Economics Association.
    5. Chenarides, Lauren & Jaenicke, Edward C. & Li, Jing, 2017. "Welfare Impacts from Store Attribute-Based Policy Interventions in an Urban Setting: An Application to Philadelphia," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258270, Agricultural and Applied Economics Association.
    6. Andrew Hanson, 2021. "Taxes and Economic Development: An Update on the State of the Economics Literature," Economic Development Quarterly, , vol. 35(3), pages 232-253, August.
    7. Kathryn Teigen De Master & Jess Daniels, 2019. "Desert wonderings: reimagining food access mapping," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 36(2), pages 241-256, June.
    8. Einiö, Elias & Overman, Henry G., 2020. "The effects of supporting local business: Evidence from the UK," Regional Science and Urban Economics, Elsevier, vol. 83(C).
    9. Lauren Chenarides & Edward C. Jaenicke, 2019. "Documenting the Link Between Poor Food Access and Less Healthy Product Assortment Across the U.S," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(3), pages 434-474, September.
    10. Freire, Tiago & Rudkin, Simon, 2019. "Healthy food diversity and supermarket interventions: Evidence from the Seacroft Intervention Study," Food Policy, Elsevier, vol. 83(C), pages 125-138.
    11. Freedman, Matthew, 2015. "Place-based programs and the geographic dispersion of employment," Regional Science and Urban Economics, Elsevier, vol. 53(C), pages 1-19.
    12. Zeballos, Eliana & Dong, Xiao & Islamaj, Ergys, 2023. "A Disaggregated View of Market Concentration in the Food Retail Industry," USDA Miscellaneous 333546, United States Department of Agriculture.
    13. Manon Garrouste & Miren Lafourcade, 2022. "Place-Based Policies: Opportunity for Deprived Schools or Zone-and-Shame Effect?," Post-Print hal-04329793, HAL.
    14. Wenhua Di & Daniel L. Millimet, 2017. "Targeted business incentives and the debt behavior of households," Empirical Economics, Springer, vol. 52(3), pages 1115-1142, May.
    15. Faggio, G. & Schluter, T. & vom Berge, P., 2019. "Interaction of Public and Private Employment: Evidence from a German Government Move," Working Papers 19/09, Department of Economics, City University London.
    16. Miren Lafourcade & Florian Mayneris, 2017. "En Finir avec les ghettos urbains ?," PSE-Ecole d'économie de Paris (Postprint) halshs-01884340, HAL.
    17. Carlianne Patrick & Amanda Ross & Heather Stephens, 2016. "Designing Policies to Spur Economic Growth: How Regional Scientists Can Contribute to Future Policy Development and Evaluation," Working Papers 16-04, Department of Economics, West Virginia University.
    18. Linlin Fan & Kathy Baylis & Craig Gundersen & Michele Ver Ploeg, 2018. "Does a nutritious diet cost more in food deserts?," Agricultural Economics, International Association of Agricultural Economists, vol. 49(5), pages 587-597, September.
    19. Faggio, Giulia, 2019. "Relocation of public sector workers: Evaluating a place-based policy," Journal of Urban Economics, Elsevier, vol. 111(C), pages 53-75.
    20. Jiang, Wei & Lu, Yi & Xie, Huihua, 2020. "Education and mental health: Evidence and mechanisms," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 407-437.

    More about this item

    Keywords

    consumption; economic development; health; place-based policies; retail food;
    All these keywords.

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:urbstu:v:55:y:2018:i:14:p:3234-3251. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.gla.ac.uk/departments/urbanstudiesjournal .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.