Skip to main content
SpringerLink
Log in

Auctions and Regulation: Reengineering of Regulatory Mechanisms**

  • Published:
Journal of Regulatory Economics Aims and scope Submit manuscript

Abstract

The FCC auctions, beginning in July 1994, were a watershed event in what may be best called reengineering regulation. It was the first time a new market mechanism, in the form of an auction, had been developed especially to replace traditional administrative procedures for regulating access to a natural resource. The spectrum auctions, and the soon to follow trading in SO2 emission rights were the two initial instances in which game theory, and more specifically auction theory, played an essential role in the design of an market-based allocation process. The FCC developed a novel auction format for the spectrum auctions. The replacing of administrative regulatory processes with market mechanisms is a major innovation in regulation, or perhaps more accurately, deregulation.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Auubel, L., P. Cramton, R. P. McAfee, and J. McMillan. 1997. “Synergies in Wireless Telephony Evidence From The Broadband PCS Auctions.” Journal of Economics and Management Strategy 6(3).

  • Bykowsky, M., R. Cull, and J. Ledyard. 2000. “Mutually Destructive Bidding. The FCC Auction Design Problem.” Journal of Regulatory Economics this issue.

  • Charles River Associates and Market Design, Inc. 1997. “Auction Design Enhancements for Non-Combinatorial Auctions.” Report 1a. Boston, MA: Charles River Associates/Market Design Incorporated.

    Google Scholar 

  • Charles River Associates and Market Design, Inc. 1997. “Package Bidding for Spectrum Licenses.” Report 1b. Boston, MA: Charles River Associates/Market Design Incorporated.

    Google Scholar 

  • Charles River Associates and Market Design. Inc. 1998. “Simultaneous Ascending Auctions For Package Bidding.” Report 2. Boston, MA: Charles River Associates/Market Design Incorporated.

    Google Scholar 

  • Charles River Associates and Market Design, Inc. 1999. “Draft Report on PPA Auction Design.” www.pwcstt.com submitted to the Alberta Department of Resource Development, September, Boston, MA: Charles River Associates/Market Design Incorporated.

    Google Scholar 

  • Cramton, P. 1994. “Controlling the pace of The MTA Broadband Auction.” Comments submitted in PP Docket. 93–253, November 8, 1994.

  • Cramton, P. 1995. “Money out of Thin Air. The Nationwide Narrowband PCS Auction.” Journal of Economics and Management Strategy 4: 267–343.

    Google Scholar 

  • Cramton, P. 1997. “The FCC Spectrum Auctions: An Early Assessment.” 6(3): 431–496.

    Google Scholar 

  • Cramton, P., and J. Schwarz. 2000. “Collusive Bidding Lessons from the FCC Spectrum Auctions.” Journal of Regulatory Economics this issue.

  • De Frutos, M. A., and Robert Rosenthal. 1998. “On Some Myths about Sequenced Common-Value Auctions.” Games and Economic Behavior 23: 201–221.

    Google Scholar 

  • Gribik, P. 1995. “Designing and Auction for QF Generation Resources In California: What Went Wrong?.” Electricity Journal (April).

  • Hazlett, T. 1998. “Assigning Property Rights to Radio Spectrum Users: Why did FCC License Auctions Take 67 Years?” Journal of Law and Economics (Forthcoming).

  • Herzel, L. 1951. “Public Interest and the Market in Color Television Regulation.” University of Chicago Law Review 18: 802–816.

    Google Scholar 

  • Hobbs, B., L. Hyde, R. P. O'Neill, and M. Rothkopf. 2000. “Evaluation of a Truthful Revelation Auction in the Context of Energy Markets with Nonconcave Benefits.” Journal of Regulatory Economics (Forthcoming).

  • Kwerel, E., and A. Felker. 1985. “Using Auctions to Select FCC Licensees.” Office of Plans and Policy Working Paper No. 16. Washington, D.C.: Federal Communications Commission.

    Google Scholar 

  • Kwerel, E., and J. Williams. 1993. “Moving Toward a Market for Spectrum for Spectrum.” Regulation: The Cato Review of Business & Government 2: 53–62.

    Google Scholar 

  • Kwerel, E., and J. Williams. November 1992. “Changing Channels: Voluntary Reallocation of UHF Television Spectrum.” Office of Plans and Policy Working Paper No. 27 Washington, D.C.: Federal Communications Commission.

    Google Scholar 

  • McAfee, P. 1993. “Auction Design for Personal Communications Services.” Attachment to Comments of PacTel (AirTouch) in PP Docket 93–253.

  • McAfee, P. 1993. “Auction Design for Personal Communications Services: Reply Comments.” Attachment to Reply Comments of PacTel (AirTouch) in PP Docket 93–253.

  • McMillan, J. 1994. “Selling Spectrum Rights.” Journal of Economic Perspectives 8(3): 145–162.

    Google Scholar 

  • Milgrom, P. R. 1996. “Procuring Universal Service: Putting Auction Theory to Work.” Lecture at the Royal Swedish Academy of Sciences in honor of William Vickrey, Le Prix Nobel The Nobel Prizes, 1996, Nobel Foundation, 1997, 382–392.

  • Milgrom, P. 1998. “Putting Auction Theory to work: The Simultaneous Ascending Auction.” mimeo Stanford, CA: Stanford University.

    Google Scholar 

  • Milton, M. 1993. “New Zealand's Revolution in Spectrum Management.” Information Economics and Policy 5: 159–177.

    Google Scholar 

  • Moreton, P. S., and P. Spiller. 1997. “What's in the Air: Interlicense Synergies and their Impact on FCC Broadband PCS License Auctions.” Journal of Law & Economics.

  • Plott, C. 1997. “Laboratory Experimental Testbeds: Application to the PCS Auction.” Journal of Economics and Management Strategy 6(3): 605–738.

    Google Scholar 

  • Rosston, G., and J. Steinberg. 1998. “Using Market-Based Spectrum Policy to Promote the Public Interest.” Federal Communications Law Journal 50(1): 87–116.

    Google Scholar 

  • Salant, D. 1997. “Up in the Air. GTE's Experience in the MTA Auction for Personal Communications Services.” Journal of Economics and Management Strategy 6(3): 549–672.

    Google Scholar 

  • Singer, H. 2000. “Determining the Source of Inter-license Synergies in Two-way Paging Networks.” Journal of Regulatory Economics (Forthcoming).

  • Sorana, Valter. 2000. “Auctions For Universal Service Subsidies.” .Journal of Regulatory Economics this Issue.

  • Stavins, Robert. 1998. “What Can We Learn From The Grand Policy Experiment? Lessons From so2 Allowance Trading.” The Journal of Economic Perspectives 12(3).

  • Van Damme, E. 1998. “The Auction of the Dutch DCS-1800 Licenses.” Rabocom 4. September.

  • Weber, R. 1997. “Making More from Less: Strategic Demand Reduction in the FCC Spectrum Auctions.” Journal of Economics and Management Strategy 6(3): 529–648.

    Google Scholar 

  • Williamson, O. E. 1975. Markets and Hierarchies New York: Free Press.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Special Consultant NERA, Inc., 444 Market Street, San Francisco, CA, 94111

    David Salant

Authors
  1. David Salant
    View author publications

    You can also search for this author in PubMed Google Scholar

Rights and permissions

Reprints and permissions

About this article

Cite this article

Salant, D. Auctions and Regulation: Reengineering of Regulatory Mechanisms**. Journal of Regulatory Economics 17, 195–204 (2000). https://doi.org/10.1023/A:1008196131032

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1023/A:1008196131032

Keywords

Search

Navigation