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Spectrum Management: Property Rights, Markets, and The Commons


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  • Farber, David J.
  • Faulhaber, Gerald R.
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    Gerald Faulhaber and David Farberconsider alternatives to the current licensing regime for spectrum, which appears to lead to substantial inefficiencies in spectrum allocation.Specifically, they examine two property rights regimes and a commons regime.Theynote that economists have favored a market-based regime while engineers have favored a commons-based regime to promote new technologies. Mr. Faulhaber and Mr. Farbershow that thereis aproperty rights market-based regime that unleashes the power of the market andthe power of the new technologies to efficiently allocate spectrum, and that is likely to meet our needs for the near-term future. This regime resolves the presumed dichotomy between the market-based and the commons-based views, so that both objectives can be realized.The authorsalso outline a transition processfor achieving the desired regime outcome that is a "win-win" for all stakeholders, and that could be politically feasible. The change to a property rights regime is likely to lower the cost of spectrum substantially, in many cases to zero.Mr. Faulhaber and Mr. Farberassert that a commons model and a market model can co-exist, at least until spectrum becomes truly scarce.

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    Bibliographic Info

    Paper provided by Regulation2point0 in its series Working paper with number 116.

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    Date of creation: Dec 2002
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    Handle: RePEc:reg:wpaper:116

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    1. Coase, Ronald H., 1992. "Autobiography," Nobel Prize in Economics documents 1991-2, Nobel Prize Committee.
    2. Hazlett, Thomas W, 1998. "Spectrum Flash Dance: Eli Noam's Proposal for "Open Access" to Radio Waves," Journal of Law and Economics, University of Chicago Press, vol. 41(2), pages 805-20, October.
    3. Hazlett, Thomas W, 1998. "Assigning Property Rights to Radio Spectrum Users: Why Did FCC License Auctions Take 67 Years?," Journal of Law and Economics, University of Chicago Press, vol. 41(2), pages 529-75, October.
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    Cited by:
    1. Michiel Bijlsma & Viktoria Kocsis & Victoria Shestalova & Gijsbert Zwart, 2008. "Vertical foreclosure: a policy framework," CPB Document 157, CPB Netherlands Bureau for Economic Policy Analysis.


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