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Jose Miguel Abito Publications

Discussion Paper
Abstract

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides infant formula to low-income households through state-level exclusive supply contracts that cover roughly half of U.S. infants. Although these contracts directly govern purchases by WIC participants, they also affect households that receive no WIC benefits. We study these spillovers using household-level in-store and online transaction data matched to WIC contract changes across states from 2018 to 2025. When a manufacturer becomes the WIC supplier, its market share among non-WIC households rises by roughly 30 percentage points in the regular-size formula segment. The response is concentrated in physical stores, where the new supplier’s market share rises by roughly 50 percentage points, while we find little systematic response online or for bulk-size products. This contrast points to the physical retail environment as a central mechanism. Additional evidence from WIC-authorized retailers and hospital formula-practice data suggests that direct exposure to WIC labels and hospital-provided samples account for relatively little of the spillover. The results show that public procurement can substantially reshape demand among untreated consumers by changing the retail environments in which choices are made.