$2 Billion Federal Program Funding Internet for Public Schools Makes No Impact on Student Performance.

STANFORD, Calif. -- E-Rate, the federal program that provides more than $2 billion to schools and libraries for the purchase of Internet technology, has helped close the "digital divide" between the affluent and the poor but has done little to affect student performance, according to new research published in Hoover Institution's Education Next.

Analyzing school data from California, University of Chicago economists Austan Goolsbee and Jonathan Guryan found that the E-Rate program clearly narrowed the digital divide among schools. However, the additional investments in technology had no immediate impact on measured student outcomes.

California is the only state that kept comprehensive records of school computer and Internet access before the enactment of the E-Rate initiative in 1998. During the 1996-97 school year, districts with the highest poverty rates had the lowest percentage of their classrooms online, a gap that widened over the next year. Once the E-Rate program began, however, the poorest schools, which had the largest subsidy rates, accelerated their adoption of Internet technology.

"The additional spending by poorer districts during E-Rate's first three years dramatically narrowed the gap," Goolsbee and Guryan said. But, they add, "in the short run, there is no evidence that schools with E-Rate subsidies learn how to use Internet technology in ways that improve test scores."

To measure the impact of E-Rate on student achievement, Goolsbee and Guryan gathered data on each school's performance on the Stanford Achievement Test (which has been administered in California since 1997). For each of the six subjects tested -- math, reading, science, language, spelling, and social studies -- the effects of the subsidy were very small; none was statistically different from zero, indicating that E-Rate did not have a large effect on student test scores. The researchers also found that Internet access had no significant impact on non-test outcomes, such as the probability of taking advanced classes, the number of graduates going into the University of California college system, or the overall dropout rate.

"In the end, the E-Rate program has helped get basically every school in the country hooked up to the Internet," Goolsbee and Guryan write. "The Internet itself, though, seems unlikely to be a silver bullet for solving the problems of America's public schools."

Read "World Wide Wonder?" in the new issue of Education Next online at www.EducationNext.org.

Austan Goolsbee is the Robert P. Gwinn Professor of Economics at the Graduate School of Business, University of Chicago, and a research associate at the National Bureau of Economic Research (NBER). Jonathan Guryan is associate professor of economics at the University of Chicago's Graduate School of Business and a faculty research fellow at the NBER.

Education Next is a scholarly journal published by the Hoover Institution that is committed to looking at hard facts about school reform. Other sponsoring institutions are the Harvard Program on Education Policy and Governance, the Thomas B. Fordham Foundation, and the Manhattan Institute for Policy Research.