The allocation of household income to food consumption

Abstract

Low-income households - those toward which various income supplement programs are aimed - not only spend a large share of their incomes on food, but exhibit a higher income elasticity of demand for food than does the rest of the population. Further, a greater proportion of the marginal income generated via welfare payments and food subsidy programs (e.g., food stamps) is devoted to food consumption than is true of wage income. These are among the major conclusions emerging from an extensive Engel Curve analysis applied to the data generated by a five-year (1968-1972) panel study of 5000 U.S. households.