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Optimal Control of Broadcasting Spectrum

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Abstract

A socially desirable number of royalties-paying users of state-owned broadcasting spectrum is derived within an optimal control framework that allows free entry and exit. The analysis takes into account the trade-off between the benefits from higher variety and royalties’ revenues and the costs of the intensified interferences associated with entry. It also considers the opposing effects of broadcasts on aggregate income: information dissemination versus diversion of productive time. The steady-state of the broadcasting industry is derived for the case where these effects offset one another and for the case where the positive information-dissemination effect is dominant.

Suggested Citation

  • Levy, Amnon & Freyens, Benoit, 2010. "Optimal Control of Broadcasting Spectrum," Economics Working Papers wp10-07, School of Economics, University of Wollongong, NSW, Australia.
  • Handle: RePEc:uow:depec1:wp10-07
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    File URL: http://www.uow.edu.au/content/groups/public/@web/@commerce/@econ/documents/doc/uow090521.pdf
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    More about this item

    Keywords

    Economics; Optimal Control; Spectrum; Variety; Interferences; Royalties;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods

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