Royalties, entry, and spectrum allocation to the broadcasting industry

Michael Ralph Caputo, Benoit Pierre Freyens

    Research output: Contribution to journalArticle

    2 Citations (Scopus)

    Abstract

    We characterize the socially optimal trajectory of spectrum royalty and firm entry in a deregulated over-the-air broadcasting industry. A social planner maximizes consumers' lifetime utility by setting royalties for the use of publicly owned spectrum. As the number of broadcasters adjusts to profits over time, the quality of service improves through greater variety but also deteriorates through intensified interferences. Contrary to observed consolidation and return to concentration in past deregulatory reforms, we find that optimal royalty control that accounts for these quality effects steers the socially optimal trajectory of royalties and firms to a more competitive steady state.

    Original languageEnglish
    Pages (from-to)1081-1098
    Number of pages18
    JournalJournal of Public Economic Theory
    Volume19
    Issue number6
    DOIs
    Publication statusPublished - 1 Dec 2017

    Fingerprint

    broadcasting
    firm
    broadcaster
    industry
    consolidation
    interference
    profit
    air
    reform
    Industry
    Broadcasting
    Royalty
    time
    Trajectory

    Cite this

    @article{6e293c54796b4a7bb699259f74db8cef,
    title = "Royalties, entry, and spectrum allocation to the broadcasting industry",
    abstract = "We characterize the socially optimal trajectory of spectrum royalty and firm entry in a deregulated over-the-air broadcasting industry. A social planner maximizes consumers' lifetime utility by setting royalties for the use of publicly owned spectrum. As the number of broadcasters adjusts to profits over time, the quality of service improves through greater variety but also deteriorates through intensified interferences. Contrary to observed consolidation and return to concentration in past deregulatory reforms, we find that optimal royalty control that accounts for these quality effects steers the socially optimal trajectory of royalties and firms to a more competitive steady state.",
    author = "Caputo, {Michael Ralph} and Freyens, {Benoit Pierre}",
    year = "2017",
    month = "12",
    day = "1",
    doi = "10.1111/jpet.12267",
    language = "English",
    volume = "19",
    pages = "1081--1098",
    journal = "Journal of Public Economic Theory",
    issn = "1097-3923",
    publisher = "Wiley-Blackwell",
    number = "6",

    }

    Royalties, entry, and spectrum allocation to the broadcasting industry. / Caputo, Michael Ralph; Freyens, Benoit Pierre.

    In: Journal of Public Economic Theory, Vol. 19, No. 6, 01.12.2017, p. 1081-1098.

    Research output: Contribution to journalArticle

    TY - JOUR

    T1 - Royalties, entry, and spectrum allocation to the broadcasting industry

    AU - Caputo, Michael Ralph

    AU - Freyens, Benoit Pierre

    PY - 2017/12/1

    Y1 - 2017/12/1

    N2 - We characterize the socially optimal trajectory of spectrum royalty and firm entry in a deregulated over-the-air broadcasting industry. A social planner maximizes consumers' lifetime utility by setting royalties for the use of publicly owned spectrum. As the number of broadcasters adjusts to profits over time, the quality of service improves through greater variety but also deteriorates through intensified interferences. Contrary to observed consolidation and return to concentration in past deregulatory reforms, we find that optimal royalty control that accounts for these quality effects steers the socially optimal trajectory of royalties and firms to a more competitive steady state.

    AB - We characterize the socially optimal trajectory of spectrum royalty and firm entry in a deregulated over-the-air broadcasting industry. A social planner maximizes consumers' lifetime utility by setting royalties for the use of publicly owned spectrum. As the number of broadcasters adjusts to profits over time, the quality of service improves through greater variety but also deteriorates through intensified interferences. Contrary to observed consolidation and return to concentration in past deregulatory reforms, we find that optimal royalty control that accounts for these quality effects steers the socially optimal trajectory of royalties and firms to a more competitive steady state.

    UR - http://www.scopus.com/inward/record.url?scp=85029279478&partnerID=8YFLogxK

    U2 - 10.1111/jpet.12267

    DO - 10.1111/jpet.12267

    M3 - Article

    VL - 19

    SP - 1081

    EP - 1098

    JO - Journal of Public Economic Theory

    JF - Journal of Public Economic Theory

    SN - 1097-3923

    IS - 6

    ER -