Focusing on eligible products, not retailer markups, may be a more effective way to contain the WIC food assistance program’s costs.

In new research, Tina Saitone, Richard Sexton, and Richard Volpe look at ways in which costs in the Women, Infant and Children (WIC) food assistance program might be contained. Using WIC purchasing data from California, they find that smaller stores charge significantly higher prices for WIC authorized foods. Using a simulation exercise which eliminates the least competitive, and highest priced vendors, they find that program costs could be reduced by 6.25 percent. However, they suggest that despite these potential cost savings, restricting the products covered by WIC vouchers to vendors’ least cost items may be more effective in reducing program costs.