The Case for Liberal Spectrum Licenses: A Technical and Economic Perspective

The traditional system of radio spectrum allocation has inefficiently restricted wireless services. Alternatively, liberal licenses ceding de facto spectrum ownership rights yield incentives for operators to maximize airwave value. These authorizations have been widely used for mobile services in the U.S. and internationally, leading to the development of highly productive services and waves of innovation in technology, applications and business models. Serious challenges to the efficacy of such a spectrum regime have arisen, however. Seeing the widespread adoption of such devices as cordless phones and wi-fi radios using bands set aside for unlicensed use, some scholars and policy makers posit that spectrum sharing technologies have become cheap and easy to deploy, mitigating airwave scarcity and, therefore, the utility of exclusive rights. This paper evaluates such claims technically and economically. We demonstrate that spectrum scarcity is alive and well. Costly conflicts over airwave use not only continue, but have intensified with scientific advances that dramatically improve the functionality of wireless devices and so increase demand for spectrum access. Exclusive ownership rights help direct spectrum inputs to where they deliver the highest social gains, making exclusive property rules relatively more socially valuable. Liberal licenses efficiently accommodate rival business models (including those commonly associated with unlicensed spectrum allocations) while mitigating the constraints levied on spectrum use by regulators imposing restrictions in traditional licenses or via use rules and technology standards in unlicensed spectrum allocations.

Contextual advertising

Contextual advertising entails the display of relevant ads based on the content that consumers view, exploiting the potential that consumers' content preferences are indicative of their product preferences. This paper studies the strategic aspects of such advertising, considering an intermediary who has access to a content base, sells advertising space to advertisers who compete in the product market, and provides the targeting technology. The results show that contextual targeting impacts advertiser profit in two ways: First, advertising through relevant content topics helps advertisers reach consumers with a strong preference for their product. Second, heterogeneity in consumers' content preferences can be leveraged to reduce product market competition, especially when competition is intense. The intermediary has incentives to strategically design its targeting technology, sometimes at the cost of the advertisers. When product market competition is moderate, the intermediary offers accurate targeting such that the consumers see the most relevant ads. When competition is high, the intermediary lowers the targeting accuracy such that the consumers see less relevant ads. Doing so intensifies competition and encourages advertisers to bid for multiple content topics in order to prevent their competitors from reaching consumers. In some cases, this may lead to an asymmetric equilibrium where one advertiser bids high even for the content topic that is more relevant to its competitor. © 2012 INFORMS

Self-organising agent communities for autonomic resource management

The autonomic computing paradigm addresses the operational challenges presented by increasingly complex software systems by proposing that they be composed of many autonomous components, each responsible for the run-time reconfiguration of its own dedicated hardware and software components. Consequently, regulation of the whole software system becomes an emergent property of local adaptation and learning carried out by these autonomous system elements. Designing appropriate local adaptation policies for the components of such systems remains a major challenge. This is particularly true where the system’s scale and dynamism compromise the efficiency of a central executive and/or prevent components from pooling information to achieve a shared, accurate evidence base for their negotiations and decisions.In this paper, we investigate how a self-regulatory system response may arise spontaneously from local interactions between autonomic system elements tasked with adaptively consuming/providing computational resources or services when the demand for such resources is continually changing. We demonstrate that system performance is not maximised when all system components are able to freely share information with one another. Rather, maximum efficiency is achieved when individual components have only limited knowledge of their peers. Under these conditions, the system self-organises into appropriate community structures. By maintaining information flow at the level of communities, the system is able to remain stable enough to efficiently satisfy service demand in resource-limited environments, and thus minimise any unnecessary reconfiguration whilst remaining sufficiently adaptive to be able to reconfigure when service demand changes

Tragedy of the Regulatory Commons: LightSquared and the Missing Spectrum Rights

The endemic underuse of radio spectrum constitutes a tragedy of the regulatory commons. Like other common interest tragedies, the outcome results from a legal or market structure that prevents economic actors from executing socially efficient bargains. In wireless markets, innovative applications often provoke claims by incumbent radio users that the new traffic will interfere with existing services. Sometimes these concerns are mitigated via market transactions, a la “Coasian bargaining.” Other times, however, solutions cannot be found even when social gains dominate the cost of spillovers. In the recent “LightSquared debacle,” such spectrum allocation failure played out. GPS interests that access frequencies adjacent to the band hosting LightSquared’s new nationwide mobile network complained that the wireless entrant would harm the operation of locational devices. Based on these complaints, regulators then killed LightSquared’s planned 4G network. Conservative estimates placed the prospective 4G consumer gains at least an order of magnitude above GPS losses. “Win win” bargains were theoretically available, fixing GPS vulnerabilities while welcoming the highly valuable wireless innovation. Yet transaction costs—largely caused by policy choices to issue limited and highly fragmented spectrum usage rights (here in the GPS band)—proved prohibitive. This episode provides a template for understanding market and non-market failure in radio spectrum allocation

The Wireless Craze, The Unlimited Bandwidth Myth, The Spectrum Auction Faux Pas, and the Punchline to Ronald Coase's 'Big Joke': An Essay on Airwave Allocation Policy

In 1959 the Federal Communications Commission invited economist Ronald Coase to testify about his proposal for market allocation of radio spectrum rights. The FCC's first question: 'Is this all a big joke'' Today, however, leading policy makers, including the current FCC Chair, decry the 'spectrum drought' produced by administrative allocation and call for the creation of private bandwidth markets. This essay examines marketplace trends driving regulators' change of humor, and considers the path of spectrum policy liberalization in light of emerging technologies, theories of unlimited bandwidth, reforms such as FCC license auctions, and recent progress in deregulating wireless markets in the U.S. and around the globe.

Impact Investing: a primer for family offices

The goal of this report is to help family offices ask the right questions as they contemplate their path into impact investing. It is important to recognize that impact investing may not suit all investors. There will be family offices which conclude impact investing is not appropriate at this stage for them. While we are passionate about the potential of impact investing, we acknowledge the best future for the sector is where each investor can make informed choices about their own best interest. Each investor and investment institution needs to evaluate if impact investing fits with its needs, interests and unique context. It is with that in mind that we offer this report as a resource and tool that family offices can use to begin the conversations internally, to craft and design their own engagement strategy on impact investing with family members, advisers and potential investees, as well as to ensure that not only is their wealth growing in value, but also that their wealth can reflect their values

The Question of Spectrum: Technology, Management, and Regime Change

There is general agreement that the traditional command-and-control regulation of radio spectrum by the FCC (and NTIA) has failed. There is no general agreement on which regime should succeed it. Property rights advocates take Ronald Coase's advice that spectrum licenses should be sold off and traded in secondary markets, like any other assets. Commons advocates argue that new technologies cannot be accommodated by a licensing regime (either traditional or property rights) and that a commons regime leads to the most efficient means to deliver useful spectrum to the American public. This article reviews the scholarly history of this controversy, outlines the revolution of FCC thinking, and parses the question of property rights vs. commons into four distinct parts: new technology, spectrum uses, spectrum management, and the overarching legal regime. Advocates on both sides find much to agree about on the first three factors; the disagreement is focused on the choice of overarching regime to most efficiently and effectively make spectrum and its applications available to the American public. There are two feasible regime choices: a property rights regime and a mixed licensed/commons regime subject to regulation. The regime choice depends upon four factors: dispute resolution, transactions costs, tragedies of the commons and anticommons, and flexibility to changing technologies and demands. Each regime is described and analyzed against these four factors. With regard to pure transactions costs, commons may hold an advantage but it appears quite small. For all other factors, the property rights regime holds very substantial advantages relative to the mixed regime. I conclude that the choice comes down to markets vs. regulation as mechanism for allocating resources.

Spatial Economic Analysis in Data-Rich Environments

Controlling for spatial effects in micro-economic studies of consumer and producer behavior necessitates a range of analytical modifications ranging from modest changes in data collection and the definition of variables to dramatic changes in the modeling of consumer and producer decision-making. This paper discusses conceptual, empirical, and data issues involved in modeling the spatial aspects of economic behavior in data rich environments. Attention is given to established and emerging agricultural economic applications of spatial data and spatial econometric methods at the micro-scale. Recent applications of individual and household data are featured, including models of land-use change at the urban-rural interface, agricultural land values, and technological change and technology adoption.Research Methods/ Statistical Methods, C21, Q10, Q12, Q15, Q56,

Foundations of Infrastructure CPS

Infrastructures have been around as long as urban centers, supporting a society’s needs for its planning, operation, and safety. As we move deeper into the 21st century, these infrastructures are becoming smart – they monitor themselves, communicate, and most importantly self-govern, which we denote as Infrastructure CPS. Cyber-physical systems are now becoming increasingly prevalent and possibly even mainstream. With the basics of CPS in place, such as stability, robustness, and reliability properties at a systems level, and hybrid, switched, and eventtriggered properties at a network level, we believe that the time is right to go to the next step, Infrastructure CPS, which forms the focus of the proposed tutorial. We discuss three different foundations, (i) Human Empowerment, (ii) Transactive Control, and (iii) Resilience. This will be followed by two examples, one on the nexus between power and communication infrastructure, and the other between natural gas and electricity, both of which have been investigated extensively of late, and are emerging to be apt illustrations of Infrastructure CPS