A healthy start for healthy start vouchers?  Under review

with Emma Frew and Johannes Lohse

Abstract:

This paper examines the impact to a recent increase in the value of healthy start vouchers on the purchase of healthy items, using a large and representative sample of 13 million shopping basket transactions collected at a major UK food retailer. We use a difference-in-differences approach to show that a £1.15 increase in voucher values increased spending on fruits and vegetables for single voucher users by 32p and for two voucher users by 77p. For all eligible items, the increase in the value of the vouchers increased spending by 31p for single voucher users and by 89p for two voucher users. Our analysis of the marginal propensity to consume indicates that consumers consume a similar additional amount from vouchers than from an equivalent increase of their general grocery budget. We also find that the effects of the value increase are greater in more deprived areas and areas with lower pre-change expenditure on eligible items, indicating potential benefits for reducing health inequalities.