The Rationality of U.S. Regulation of the Broadcast Spectrum in the 1934 Communications Act
The Federal Radio Commission regulated radio broadcasting, 1927–1934. With the passage of the Communications Act of 1934, the 1927 Radio Act (enabling the Commission) was re-enacted in whole. This congressional endorsement yields key evidence as to what policy outcomes were intended, differentiating competing theories for the origins of spectrum allocation law: Coase (J Law Econ 2(1):1–40, 1959), emphasizing policy error; Hazlett (J Law Econ 33:133–175, 1990), focusing on “franchise rents” in a public choice framework; and the “public interest” hypothesis, reconstructed by Moss and Fein (J Policy Hist 15(4):389–416, 2003). Congress’ revealed preferences prove consistent with the franchise rents theory, while contradicting the other two.
KeywordsPolitical economy Spectrum allocation Rent-seeking Public interest
The author thanks Michelle Connolly and Lawrence J. White for useful input. Ariel Blask, Brent Skorup and Ryan Tacher provided excellent research assistance. All errors are solely attributable to the author.
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