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Thursday, November 08, 2012

No skincrease here

Another Funds for Learning infogram, delightfully short on text and long on graphs.  The second graph shows the troubling increase in Priority One demand, which reached $2 billion this year.  But I noticed something else: a steady decrease in the share paid by the applicant.  In 2000, the applicant share was 33% of the total; in 2012, it was around 25%.

Why?  I can think of a few possible reasons:
  1. Climbing poverty rates: in 2000, 11.3% of U.S. families lived in poverty; in 2011, it was 15.7%.  I've mentioned this before.
  2. Applicant sophistication: more applicants are using consultants, some of whom know how to maximize discounts.
  3. Applicant abandonment: 20% applicants have thrown up their hands at the ridiculous complexity and secrecy to get a few thousand dollars, and left the program.
  4. Entry attractiveness:  Among applicants not participating in the E-Rate in 2000, the higher the discount, the more attractive the program.
  5. Incentive inequalities: Let's face it, 90% applicants increase their spending at a much faster clip than 40% applicants, because it costs them next to nothing to upgrade to ridiculous bandwidth.
But I guess we'll never know what really caused the decrease in applicant skin in the game.  Unless FFL can turn it into a graph for us.

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