American Economic Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Measuring the Efficiency of an FCC Spectrum Auction
American Economic Journal: Microeconomics
(pp. 100–146)
Abstract
We propose a method to structurally estimate the deterministic component of bidder valuations in FCC spectrum auctions, and apply it to the 1995-1996 C block auction. We base estimation on a pairwise stability condition: two bidders cannot exchange two licenses in a way that increases the sum of their valuations. Pairwise stability holds in some theoretical models of simultaneous ascending auctions under intimidatory collusion and demand reduction. Pairwise stability results in a matching game approach to estimation. We find that a system of four large regional licenses would raise the allocative efficiency of the C block outcome by 48 percent. (JEL D44, D45, H82, L82)Citation
Fox, Jeremy T., and Patrick Bajari. 2013. "Measuring the Efficiency of an FCC Spectrum Auction." American Economic Journal: Microeconomics 5 (1): 100–146. DOI: 10.1257/mic.5.1.100Additional Materials
JEL Classification
- D44 Auctions
- D45 Rationing; Licensing
- H82 Governmental Property
- L82 Entertainment; Media