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Wic And The Retail Price Of Infant Formula

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  • Oliveira, Victor
  • Prell, Mark A.
  • Smallwood, David M.
  • Frazao, Elizabeth

Abstract

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.

Suggested Citation

  • Oliveira, Victor & Prell, Mark A. & Smallwood, David M. & Frazao, Elizabeth, 2004. "Wic And The Retail Price Of Infant Formula," Food Assistance and Nutrition Research Reports 33873, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersfa:33873
    DOI: 10.22004/ag.econ.33873
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    References listed on IDEAS

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    1. Michael B. Ward & Jay P. Shimshack & Jeffrey M. Perloff & J. Michael Harris, 2002. "Effects of the Private-Label Invasion in Food Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 961-973.
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    Cited by:

    1. David E. Davis, 2012. "Bidding for WIC Infant Formula Contracts: Do Non-WIC Customers Subsidize WIC Customers?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(1), pages 80-96.
    2. Oliveira, Victor, 2007. "Informing Food and Nutrition Assistance Policy: 10 Years of Research at ERS," Miscellaneous Publications 262274, United States Department of Agriculture, Economic Research Service.
    3. Rui Huang & Jeffrey Perloff, 2014. "WIC Contract Spillover Effects," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 44(1), pages 49-71, February.
    4. Oliveira, Victor & Frazao, Elizabeth & Smallwood, David M., 2011. "The Infant Formula Market: Consequences of a Change in the WIC Contract Brand," Economic Research Report 118020, United States Department of Agriculture, Economic Research Service.
    5. Tiffany Green, 2011. "Infant feeding and asthma: is breast milk best?," Review of Economics of the Household, Springer, vol. 9(4), pages 487-504, December.
    6. Oliveira, Victor & Davis, David E., 2006. "Recent Trends and Economic Issues in the WIC Infant Formula Rebate Program," MPRA Paper 6657, University Library of Munich, Germany.
    7. Oliveira, Victor & Frazao, Elizabeth, 2015. "The WIC Program: Background, Trends, and Economic Issues, 2015 Edition," Economic Information Bulletin 197543, United States Department of Agriculture, Economic Research Service.
    8. Hodges, Leslie & Toossi, Saied & Todd, Jessica E. & Ryan-Claytor, Cayley, 2024. "The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC): Background, Trends, and Economic Issues, 2024 Edition," Economic Information Bulletin 341637, United States Department of Agriculture, Economic Research Service.
    9. Oliveira, Victor & Frazao, Elizabeth & Smallwood, David, 2013. "Trends in Infant Formula Rebate Contracts: Implications for the WIC Program," Economic Information Bulletin 161130, United States Department of Agriculture, Economic Research Service.
    10. David Davis, 2014. "Buyer Alliances as Countervailing Power in WIC Infant-Formula Auctions," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 45(2), pages 121-138, September.
    11. Jackie Yenerall & Andrew Muhammad & Karen DeLong & Trey Malone, 2024. "Navigating the challenges of building a more resilient infant formula industry," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 46(2), pages 499-513, June.
    12. Prell, Mark A., 2004. "An Economic Model Of Wic, The Infant Formula Rebate Program, And The Retail Price Of Infant Formula," Food Assistance and Nutrition Research Reports 33879, United States Department of Agriculture, Economic Research Service.
    13. David E. Davis, 2012. "Bidding for WIC Infant Formula Contracts: Do Non-WIC Customers Subsidize WIC Customers?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(1), pages 80-96.
    14. Saitone, Tina L. & Sexton, Richard J. & Volpe, Richard J., III, 2012. "Markups and Promotional Patterns of California WIC-Authorized Foods," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124927, Agricultural and Applied Economics Association.
    15. Rojas Christian A. & Wei Hongli, 2019. "Spillover Mechanisms in the WIC Infant Formula Rebate Program," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 17(2), pages 1-14, November.

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    Keywords

    Food Security and Poverty;

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