Employing new data on school technology usage in every California public school from 1996 to 2000, as well as application data from the E-Rate program, Goolsbee and Guryan find that the subsidy did succeed in significantly increasing schools' investment in Internet technology. By 2000, there were approximately 66 percent more classrooms in California with Internet connections than there would have been without the subsidy-the equivalent of accelerating Internet investment by about four years.
Despite the noticeable increase in classroom Internet connections, the authors find very little evidence that the program has any impact on student achievement, as measured by test scores in a variety of subjects.
Analyzing the E-Rate
The E-Rate program was designed to give all eligible schools and libraries affordable access to modern telecommunications and information services. The subsidy can be used for spending on all commercially available telecommunications services, Internet access, and internal communications, but not for buying computers for the school. The subsidy rate ranges from 20 to 90 percent depending on the school's share of students that qualify for the national school lunch program.
The federal government subsidizes or gives free school lunches to students whose family income is below a certain level, usually close to the poverty level. The number of school lunch eligible students determines funding for many federal and state education-related programs.