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Understanding Participation in Social Programs: Why Don't Households Pick up the Lifeline?

Author

Listed:
  • Burton Mark

    (University of Tennessee)

  • Macher Jeffrey

    (Georgetown University)

  • Mayo John W

    (Georgetown University)

Abstract

In this study, we draw upon data from the low-income Lifeline Assistance Program (Lifeline) for telephone service to examine the participation of eligible households in social programs designed to alleviate financial hardship. Utilizing panel data on participation levels in 1997 and 2003 and the associated variation in state-level policies, we are able to identify program characteristics that significantly affect participation rates. In particular, we find that participation rates are significantly negatively influenced by limitations that some states place on the ability of Lifeline subscribers to utilize optional calling features such as three-way calling or call forwarding. We also find that program participation is positively influenced by the longevity of the individual state's Lifeline program. While no direct test of state-level advertising is feasible, this result is suggestive of an inter-temporal pattern of information dissemination that grows with program longevity. Because eligibility for the Lifeline service is conditional upon participation in other low-income public programs, we also find that: (1) the larger the number of "portals" (i.e., low income public programs that states identify as creating Lifeline eligibility), the higher is participation; and (2) higher financial benefits of these portal programs attract greater participation in Lifeline programs. These results suggest important linkages that may be exploited through coordination of low-income assistance programs. Finally, we test for, and find that variations in Lifeline benefits significantly influence participation rates.

Suggested Citation

  • Burton Mark & Macher Jeffrey & Mayo John W, 2007. "Understanding Participation in Social Programs: Why Don't Households Pick up the Lifeline?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 7(1), pages 1-28, November.
    • Handle: RePEc:bpj:bejeap:v:7:y:2007:i:1:n:57
    DOI: 10.2202/1935-1682.1583
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    References listed on IDEAS

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    1. Eriksson, Ross C & Kaserman, David L & Mayo, John W, 1998. "Targeted and Untargeted Subsidy Schemes: Evidence from Postdivestiture Efforts to Promote Universal Telephone Service," Journal of Law and Economics, University of Chicago Press, vol. 41(2), pages 477-502, October.
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    Cited by:

    1. Björkegren, Daniel & Karaca, Burak Ceyhun, 2022. "Network adoption subsidies: A digital evaluation of a rural mobile phone program in Rwanda," Journal of Development Economics, Elsevier, vol. 154(C).
    2. Hauge, Janice A. & Jamison, Mark A. & Todd Jewell, R., 2008. "Discounting telephone service: An examination of participation in the Lifeline Assistance Program using panel data," Information Economics and Policy, Elsevier, vol. 20(2), pages 135-149, June.
    3. Daniel Ackerberg & Michael Riordan & Gregory Rosston & Bradley Wimmer, 2008. "Low-Income Demand for Local Telephone Service: Effects of Lifeline and Linkup," Discussion Papers 07-032, Stanford Institute for Economic Policy Research.
    4. Jeffrey T. Macher & John W. Mayo & Olga Ukhaneva & Glenn A. Woroch, 2017. "From universal service to universal connectivity," Journal of Regulatory Economics, Springer, vol. 52(1), pages 77-104, August.
    5. Ward, Michael R. & Woroch, Glenn A., 2010. "The effect of prices on fixed and mobile telephone penetration: Using price subsidies as natural experiments," Information Economics and Policy, Elsevier, vol. 22(1), pages 18-32, March.
    6. Thomas S. Conkling, 2020. "Compliance and competition with heterogeneous service providers: the federal Lifeline program," Journal of Regulatory Economics, Springer, vol. 57(1), pages 74-104, February.
    7. Jayakar, Krishna & Park, Eun-A, 2019. "Reforming the lifeline program: Regulatory federalism in action?," Telecommunications Policy, Elsevier, vol. 43(1), pages 67-75.
    8. Holt, Lynne & Galligan, Mary, 2013. "Mapping the field: Retrospective of the federal universal service programs," Telecommunications Policy, Elsevier, vol. 37(9), pages 773-793.
    9. Daniel Bjorkegren & Burak Ceyhun Karaca, 2020. "The Effect of Network Adoption Subsidies: Evidence from Digital Traces in Rwanda," Papers 2002.05791, arXiv.org.
    10. Thomas S. Conkling, 2018. "Crowd‐Out or Affordability? The Lifeline Expansion's Effect on Wireless Service Spending," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 37(2), pages 357-383, March.
    11. Ford, George S., 2021. "Subsidies and substitution: An empirical study of the lifeline program," Telecommunications Policy, Elsevier, vol. 45(1).

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