Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
557449 | Telecommunications Policy | 2010 | 10 Pages |
Abstract
This paper argues that “Do auctions raise consumer prices?” is a misleading question. License fee payment methods, rather than spectrum assignment methods, are key factors that bring forth different market outcomes in the wireless telecommunication industry. This paper analyzes and discusses the effects of three spectrum license fee payment methods—upfront lump-sum fees, royalties, and profit sharing—on economic efficiency, spectrum supply, and government revenue. Royalties create distortions in product and factor markets but can induce the government to increase spectrum supply and encourage firms’ investments. A caveat is that the analyses are based on the model assuming monopoly market and information certainty.
Keywords
Related Topics
Physical Sciences and Engineering
Computer Science
Information Systems
Authors
Youngsun Kwon, Jungsub Lee, Youngkyun Oh,