The Biggest Auction Ever: the Sale of the British 3G Telecom Licenses

This paper reviews the part played by economists in organizing the British third-generation mobile-phone licence auction that concluded on 27 April 2000. It raised £22 1/2 billion ($34 billion or 2 1/2% of GNP) and was widely described at the time as the biggest auction ever. We discuss the merits of auctions versus "beauty contests", the aims of the auction, the problems we faced, the auction designs we considered, and the mistakes that were made.Auctions, Telecommunications, Spectrum Auctions, Mobile Phones, 3G, UMTS, Bidding.

Social Contract III: Evolution and Utilitarianism

The paper takes the simplest possible bargaining game as a paradigm for the coordination problem—i.e. the problem of selecting an equilibrium when many are available. The aim is to explore the circumstances under which evolution will lead to a utilitarian conclusion.Center for Research on Economic and Social Theory, Department of Economics, University of Michiganhttp://deepblue.lib.umich.edu/bitstream/2027.42/100628/1/ECON105.pd

Bargaining Theory Without Tears

The purpose of this article is two-fold. The primary aim is to provide a simple proof of a version of Rubinstein's bargaining theorem in a setting that is sufficiently general to cover the situations that typically arise in applications. In particular, the feasible set is not assumed to be convex and a reasonably general view is taken of the manner in which disagreement may arise. The secondary aim pursues some points made in Binmore/Rubinstein/Wolinsky. A detailed analysis of subgame-perfect equilibria in a complicated non-cooperative bargaining model is unnecessary for most applications. Much heavy computation can be short-circuited by applying certain simple principles directly rather than deriving them anew each time they are required. The methodology is illustrated in section 8 for a model of decentralized price formationCenter for Research on Economic and Social Theory, Department of Economics, University of Michiganhttp://deepblue.lib.umich.edu/bitstream/2027.42/100625/1/ECON102.pd

Social Contract I: Harsanyi and Rawls

This is the first of several papers whose beginnings lie in Rawls' [1958, 1968, 1972] theory of the social contract. The aim of the sequence of papers is to defend a verson of Rawls' "egalitarian" conclusion for a world in which agents are assumed to be constrained only by rational self-interest. No foundational issues are taken for granted. This is partly because I hope to make the work accessible to a wider audience; but mostly because I believe that much confusion in the literature derives from straightforward misunderstanding on matters which out not to be controversial.Center for Research on Economic and Social Theory, Department of Economics, University of Michiganhttp://deepblue.lib.umich.edu/bitstream/2027.42/100626/1/ECON103.pd

Social Contract II: Gauthier and Nash

This is the second of several free-standing papers whose beginnings lie in Rawls' [1958, 1968, 1972] theory of the social contract. The aim of the sequence of papers is to defend a version of Rawls' "egalitarian" conclusion for a world in which agents are assumed to be constrained only by rational self-interest.Center for Research on Economic and Social Theory, Department of Economics, University of Michiganhttp://deepblue.lib.umich.edu/bitstream/2027.42/100627/1/ECON104.pd

A tribute to Anatole Beck (1930-2014)

A little over a year since his passing, Adam Ostaszewki, Professor of Mathematics at LSE, remembers Anatole Beck, our friend and colleague, with input from Steve Alpern and Kenneth Binmore. They have also put together a bibliography of Anatole’s work

Common Knowledge and Game Theory

Perhaps the most important area in which common knowledge problems arise is in the study of rational expectations equilibria in the trading of risky securities. How can there be trade if everybody's willingness to trade means that everybody knows that everybody expects to be a winner? (see Milgrom/Stokey [1982] and Geanakoplos [1988].) Since risky securities are traded on the basis of private information, there must presumably be some "agreeing to disagree" in the real world. But to assess its extent and its implications, one needs to have a precise theory of the norm from wich "agreeing to disagree" is seen as a deviation. The beginnings of such a theory are presented here. Some formalism is necessary in such a presentation because the English language is not geared up to express the appropriate ideas compactly. Without some formalism, it is therefore very easy to get confused. However, nothing requiring any mathematical expertise is to be described.Center for Research on Economic and Social Theory, Department of Economics, University of Michiganhttp://deepblue.lib.umich.edu/bitstream/2027.42/100630/1/ECON107.pd