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APPENDIX B
THE ALLOCATION OUTCOMES MODEL

This spreadsheet model is designed to accept as inputs budget allocation team decisions from Move 1 in the Policy Exercise on Education and the New Economy and to produce plausible feedback for teams as they begin Move 2 deliberations, four years ahead in game time. Feedback includes program participation rates, indicators of student success, and workforce distribution by educational attainment--all at the state level.

The spreadsheet consists of four parts for each data set, the first of which is allocation of funds (see Tables B.1 and B.2). The first column is budget items, beginning with K-12 education. The second column gives state and federal categorical allocations, which cannot be changed. The third column gives block grant funding available for the panel to allocate. The federal formula for determining the size of the block grant is posited to be based on the previous year's categorical grants being replaced by the block grant; the amount of block grant funding due to prior categorical grants is shown in the third column, plus additional other/unallocated funding. The fourth column shows the percentage allocation of the total block grant if the state were to do a status quo allocation--that is, as though the entire block grant, including the other/unallocated augmentation, were to be allocated in the same proportions as federal funding was made available under the previous year's categorical funding. The fifth column is for the panel's allocation of the block grant, in percentages.

The other tables--program participation, indicators of student success, and workforce distribution by educational attainment--each have base, projected, and achieved columns. Base is current base, as of Move 1 game time. Projected is the estimate for four years hence, calculated from status quo assumptions. Achieved is the outcome four years hence, calculated from the panel's allocation.

The model's plausibility depends both on the reasonableness of the base data and the logic linking allocations to the projected and actual estimates.



Table B.1
Montoya Data

State & Fed _____________________Block grant________________
categorical
($M) 		Avail.to allocate
($M)		 Status quo
allocation		 Panel's
allocation
K-12 education $12,264
Community colleges $1,300
Other postsecondary $5,235
Pell-like grants $874 56.1% 56.1%
Job training $42 $581 37.3% 37.3%
Secondary (Perkins) $33 2.1% 2.1%
Postsecondary (Perkins) $44 2.8% 2.8%
Adult education $567 $26 1.7% 1.7%
Welfare to work $62
Tax Credits or Deductions
Other/Unallocated $823
$19,470 $2,381 100.0% 100.0%

________________Program Participation______________
Program Base Projected Achieved
High School 1,451,609 1,596,770 1,596,770
Two-Year College 1,113,171 1,260,764 1,260,764
Four-Year College 511,753 545,091 545,091
Adult Basic 761,637 837,801 837,801
Adult Secondary 260,946 287,041 287,041
Job Training 248,200 274,120 274,120
Public Assistance 930,188 1,023,207 1,023,207

_______________Indicators of Success_______________
Success Indicator Base Projected Achieved
Secondary Diploma/GED 261,761 287,937 287,937
Postsecondary/Adv Tng 65,440 71,984 71,984
Associate Degree 56,417 63,897 63,897
>=Bachelor Basic 164,818 175,555 175,555
Post-Tng Placement 174,440 191,884 191,884
Employed 92.80% 92.80% 92.80%
Per-Capita Earnings $22,035 $22,035 $22,035

___Workforce Composition by Educational Attainment___
Educational Attainment Earnings Base Projected Achieved
Less Than High School Grad $7,811 23.8% 23.8%23.8%
High School Graudate Only $16,606 22.3% 22.3% 22.3%
Some college, no degree $20,035 22.6% 22.6% 22.6%
Associate degree $26,970 7.9% 7.9%
>=Bachelor's Degree $41,942 23.4% 23.4% 37.3%
100.0% 100.0% 100.0%



Table B.2
Algonquin Data

State & Fed _____________________Block grant________________
categorical
($M) 		Avail.to allocate
($M)		 Status quo
allocation		 Panel's
allocation
K-12 education $6,030 27.0%
Community colleges $174
Other postsecondary $1,528
Pell-like grants $288 54.8%
Job training $11 $194 36.9% 26.0%
Secondary (Perkins) $29 5.5% 23.0%
Postsecondary (Perkins) $6 1.1% 20.0%
Adult education $57 $9 1.7% 4.0%
Welfare to work $16
Tax Credits or Deductions
Other/Unallocated $247
$7,816 $773 100.0% 100.0%

________________Program Participation______________
Program Base Projected Achieved
High School 519,001 570,901 579,607
Two-Year College 164,213 172,150 161,023
Four-Year College 307,053 307,984 305,432
Adult Basic 88,302 97,132 97,577
Adult Secondary 20,451 22,496 26,533
Job Training 82,000 90,200 87,746
Public Assistance 210,094 231,103 229,855

_______________________
_______________Indicators of Success_______________
Success Indicator Base Projected Achieved
Secondary Diploma/GED 110,217 112,421 118,926
Postsecondary/Adv Tng 27,554 30,310 29,840
Associate Degree 20,117 21,089 21,172
>=Bachelor Basic 71,352 71,568 71,392
Post-Tng Placement 57,400 63,140 61,983
Employed 95.20% 95.20% 95.23%
Per-Capita Earnings________ $20,475 $20,475 $20,896

___Workforce Composition by Educational Attainment___
Educational Attainment Earnings Base Projected Achieved
Less Than High School Grad $8,023 24.3% 24.3%18.9%
High School Graudate Only $17,057 36.3% 36.3% 43.1%
Some college, no degree $20,579 17.0% 17.0% 15.4%>
Associate degree $27,702 5.3% 5.3% 5.8%
>=Bachelor's Degree $43,082 17.1% 17.1% 16.9%
100.0% 100.0% 100.0%

DATA

The base data were prepared for two states: California (called Montoya in the game) and Ohio (called Algonquin in the game). Where available, the most recent state-specific data were used.


Participation

High-School Participation. Base high-school participation is from the Digest of Educational Statistics 1996 (DES) Table 39, which gives public school enrollment by state for grades 9-12, as of fall 1994.

Two-Year and Four-Year College Participation. Base college participation is from DES Table 194, which gives public and private two-year and four-year college enrollment by state, as of 1994.

Adult Basic Education Participation. Base adult basic and secondary participation is from DES Table 352, which gives enrollment by state, as of 1991.

Job Training Participation. Base value calculated as job training funding divided by an assumed cost of $2,500 per student.

Post-Training Placement Participation. Base value calculated as an assumed 70 percent of job training.

Public Assistance Participation. Montoya data are for adults on Aid to Families with Dependent Children (AFDC) plus able-bodied adults without dependents on public assistance, according to the California Budget Project. Algonquin data are for "groups" on AFDC public assistance as of September 1996, according to the Ohio Department of Health Services Office of Research and Andersen Consulting Analysis.


Success Indicators

Secondary Diploma or General Equivalency Diploma (GED). Base data are from DES Table 99, which gives public high school graduates by state, as of 1995-1996.

Postsecondary/Advanced Training Completion. Base value calculated as an assumed 25 percent of secondary diploma or GED base value.

Associate Degree and >= Bachelor Degree. Earned degrees are from DES Table 240, as of 1993-1994.


Employed

Base employment figures are based on 1996 unemployment rates for California and Ohio of 7.2 percent and 4.8 percent, respectively.


AverageEarnings

Calculated from earnings by educational attainment and workforce composition.


WORKFORCE


Workforce Composition by Educational Attainment

DES Table 11 gives educational attainment of persons 25 and older by state for 1990. The base workforce composition is assumed to be the same.


Earnings by Educational Attainment

Census Bureau national earnings by educational attainment for 1993 are as follows:

Educational Attainment Earnings
Less than high school grad $6,096
High school graduate only $12,960
Some college, no degree $15,636
Associate degree $21,048
>= Bachelor's degree $32,733

By assuming that Montoya's per-capita earnings by educational attainment are 1.28135 times the national mean, we get a base per-capita earnings figure of $22,035, which matches the California personal income per capita for 1995 in 1992 dollars.

By assuming that Algonquin's per-capita earnings by educational attainment are 1.31615 times the national mean, we get a base per-capita earnings figure of $20,475, which matches the Ohio personal income per capita for 1995 in 1992 dollars.[12]


Logic

In general, allocation of discretionary federal funding affects program participation which, in turn, affects success indicators. The success indicators representing educational attainment affect the proportions of workforce by educational attainment which, in turn, affect per-capita earnings, one of the success indicators. The success indicator "employed" is affected by job training and post-training placement program participation.

The logic assumed in these relationships is presented below in a series of tables. In all cases, change is expressed as a percentage.



Table B.3
Allocation Effects on Program Participation

Program Participation Posited Relationship
K-12 Education
High School 5% times change in allocation
Two-Year College 2% times change in allocation
Four-Year College 2% times change in allocation
Post-Training Placement
Adult Basic
Adult Secondary
Job Training
Public Assistance -2% times change in allocation
Secondary Diploma or GED 3% times change in allocation
Community Colleges
High School
Two-Year College 25% times change in allocation
Four-Year College
Post-Training Placement
Adult Basic
Adult Secondary
Job Training
Public Assistance
Other Postsecondary
High School
Two-Year College
Four-Year College 2.5% times change in allocation
Post-Training Placement
Adult Basic
Adult Secondary
Job Training
Public Assistance
Pell-Like Grants
High School
Two-Year College 20% times change in allocation
Four-Year College 25% times change in allocation
Post-Training Placement
Adult Basic
Adult Secondary
Job Training
Public Assistance
Job Training
High School
Two-Year College
Four-Year College
Post-Training Placement 20% times change in allocation
Adult Basic
Adult Secondary
Job Training 25% times change in allocation
Public Assistance
Secondary (Perkins)
    • High School 1% times change in allocation
    Two-Year College 1% times change in allocation
    Four-Year College
    Post-Training Placement
    Adult Basic
    Adult Secondary Proportional to change in allocation
    Job Training
    Public Assistance
    Secondary Diploma or GED 3% times change in allocation
    Postsecondary (Perkins)
    High School
    Two-Year College 20% times change in allocation
    Four-Year College
    Post-Training Placement
    Adult Basic
    Adult Secondary
    Job Training
    Public Assistance
    Adult Education
    High School
    Two-Year College
    Four-Year College
    Post-Training Placement 15% times change in allocation
    Adult Basic 20% times change in allocation
    Adult Secondary 20% times change in allocation
    Job Training
    Public Assistance
    Welfare to Work
    High School
    Two-Year College
    Four-Year College
    Post-Training Placement 10% times change in allocation
    Adult Basic
    Adult Secondary
    Job Training 25% times change in allocation
    Public Assistance -25% times change in allocation
    Tax Credits or Behavior
    High School
    Two-Year College 15% times change in allocation
    Four-Year College 20% times change in allocation
    Post-Training Placement
    Adult Basic
    Adult Secondary
    Job Training
    Public Assistance
    Other (No Relationship Defined)
    *Secondary vocational education is assumed to affect participation in adult secondary and secondary diploma or GED.
    NOTE: "Other" and its impacts were not predefined. Where used and defined by a panel, we attempted to specify logic and calculate impacts ad hoc.



    Table B.4
    Program Participation Effects on Success Indicators

    Success Indicator Posited Relationship
    High School
    Secondary diploma or GED 50% times % change in participation
    Postsecondary/advanced training 20% times % change in participation
    Associate degree 20% times % change in participation
    >= Bachelor's degree 20% times % change in participation
    Employed 1% times % change in participation
    Per-capita earnings Not directly related
    Two-Year College
    Secondary diploma or GED
    Postsecondary/advanced training 50% times % change in participation
    Associate degree 25% times % change in participation
    >= Bachelor's degree 20% times % change in participation
    Employed 1% times % change in participation
    Per-capita earnings Not directly related
    Four-Year College
    Secondary diploma or GED
    Postsecondary/advanced training
    Associate degree
    >= Bachelor's degree 20% times % change in participation
    Employed 1% times % change in participation
    Per-capita earnings Not directly related
    Post-Training Placement
    Secondary diploma or GED
    Postsecondary/advanced training
    Associate degree
    >= Bachelor's degree
    Employed 5% times % change in participation
    Per-capita earnings Not directly related
    Adult Basic
    Secondary diploma or GED 10% times % change in participation
    Postsecondary/advanced training 10% times % change in participation
    Associate degree 10% times % change in participation
    >= Bachelor's degree 2% times % change in participation
    Employed 1% times % change in participation
    Per-capita earnings Not directly related
    Adult Secondary
    Secondary diploma or GED 20% times % change in participation
    Postsecondary/advanced training 15% times % change in participation
    Associate degree 10% times % change in participation
    >= Bachelor's degree 5% times % change in participation
    Employed 1% times % change in participation
    Per-capita earnings Not directly related
    Job Training
    Secondary diploma or GED
    Postsecondary/advanced training 50% times % change in participation
    Associate degree 5% times % change in participation
    >= Bachelor's degree
    Employed 1% times % change in participation
    Per-capita earnings Not directly related
    Public Assistance
    Secondary diploma or GED -10% times % change in participation
    Postsecondary/advanced training
    Associate degree
    >= Bachelor's degree
    Employed -50% times % change in participation
    Per-capita earnings Not directly related



    Table B.5
    Success Indicator Effects on Workforce Composition

    Educational Attainment Posited Relationship
    >= Bachelor's degree
    >= Bachelor's degree Proportional to change
    Associate degree -50% of change in >= bachelor's degree
    Some college, no degree -50% of change in >= bachelor's degree
    High school graduate only
    Less than high school grad
    Associate Degree
    >= Bachelor's degree
    Associate degree Proportional to change
    Some college, no degree -50% of change in associate degree
    High school graduate only -50% of change in associate degree
    Less than high school grad
    Postsecondary or Advanced Training
    >= Bachelor's degree
    Associate degree
    Some college, no degree Proportional to change
    High school graduate only -75% of change in postsecondary or advanced training
    Less than high school grad -25% of change in postsecondary or advanced training
    Secondary Diploma or GED
    >= Bachelor's degree
    Associate degree
    Some college, no degree
    High school graduate only Proportional to change
    Less than high school grad -100% of change in secondary diploma or GED
    NOTE: These changes are calculated in the sequence shown, from top to bottom, such that the total always sums to 100 percent of the workforce.

    [12] Algonquin's higher earnings factor yields a lower per-capita earnings figure because Montoya has a better-educated workforce.

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