The Efficiency of the FCC Spectrum Auctions
The Efficiency of the FCC Spectrum Auctions
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Publication or External Link
Date
1998-10
Authors
Cramton, Peter
Advisor
Citation
"The Efficiency of the FCC Spectrum Auctions," Journal of Law and Economics, 41, 727-736, October 1998.
DRUM DOI
Abstract
From July 1994 to July 1996, the Federal Communications Commission (FCC)
conducted nine spectrum auctions, raising about $20 billion for the U.S. Treasury. The
auctions assigned thousands of licenses to hundreds of firms. Were the auctions efficient? Did they award the licenses to the firms best able to turn the spectrum into valuable services for consumers? There is substantial evidence that the FCC’s simultaneous ascending auction worked well. It raised large revenues. It revealed critical information in the process of bidding and gave bidders the flexibility to adjust strategies in response to new information. As a result, similar licenses sold for similar prices, and bidders were
able to piece together sensible sets of licenses.