Efficient Relocation of Spectrum Incumbents

Changes in technologies and in consumer demands have made prior radio spectrum allocations far from efficient. To address this problem the FCC has recently reallocated spectrum for more flexible use in bands that are partially occupied by incumbent license holders. Often, it is necessary for the new license holder to relocate incumbents to make efficient use of the spectrum. Regulations structuring the negotiation between incumbent and new entrant can promote efficiency. In particular, giving the new entrant the right to move the incumbent with compensation can reduce negotiation costs and promote efficiency when there is private information about spectrum values but good public information about the cost of relocating the incumbent. We examine the experience of broadband PCS entrants in relocating microwave incumbents. We conclude with some remarks on how these ideas might be applied to digital television spectrum.Bargaining; Auctions; Spectrum Auctions; Telecommunications Policy

Using Spectrum Auctions to Enhance Competition in Wireless Services

Spectrum auctions are used by governments to assign and price licenses for wireless communications. Effective auction design recognizes the importance of competition, not only in the auction, but in the downstream market for wireless communications. This paper examines several instruments regulators can use to enhance competition and thereby improve market outcomes.

Efficient Relocation of Spectrum Incumbents

Changes in technologies and in consumer demands have made prior radio spectrum allocations far from efficient. To address this problem the FCC has recently reallocated spectrum for more flexible use in bands that are partially occupied by incumbent license holders. Often, it is necessary for the new license holder to relocate incumbents to make efficient use of the spectrum. Regulations structuring the negotiation between incumbent and new entrant can promote efficiency. In particular, giving the new entrant the right to move the incumbent with compensation can reduce negotiation costs and promote efficiency when there is private information about spectrum values but good public information about the cost of relocating the incumbent. We examine the experience of broadband PCS entrants in relocating microwave incumbents. We conclude with some remarks on how these ideas might be applied to digital television spectrum

Economic Welfare and the Production of Information by a Monopolist: The Case of Drug Testing

This paper uses a specific model to analyze a monopolist's incentives to produce information about a consumer product. The particular example considered is testing of a therapeutic drug whose probability of undesirable side effects is not precisely known. The main result of the paper is that ex post pricing latitude by a monopolist (after the results of drug testing are in) encourages greater testing than would occur under rigid pricing. It is also shown that the socially optimal amount of testing is less under such responsive pricing than under rigid pricing.