Discounting telephone service: An examination of participation in the Lifeline Assistance Program using panel data

We examine the Lifeline Assistance Program to consider reasons people forgo a program providing financial benefits. Using panel data we employ a feasible generalized least squares estimation in which the dependent variable is the logit of the Lifeline participation rate. Our unique database incorporates characteristics of the eligible rather than the general population. We find incumbent telecommunications providers' enrollment efforts are statistically significant, and that home ownership and female head of household are associated with greater participation; being elderly and less educated are associated with less participation. Additionally, we find that an increase in the local phone rate is associated with increased participation. Our findings are important for regulatory policy surrounding the Lifeline program and universal service programs generally.