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Collusive Bidding: Lessons from the FCC Spectrum Auctions

Collusive Bidding: Lessons from the FCC Spectrum Auctions The Federal Communications Commission (FCC) spectrum auctions use a simultaneous ascending auction design. Bidders bid on numerous communication licenses simultaneously, with bidding remaining open on all licenses until no bidder is willing to bid higher on any license. With full revelation of bidding information, simultaneous open bidding allows bidders to send messages to their rivals, telling them on which licenses to bid and which to avoid. These strategies can help bidders coordinate a division of the licenses, and enforce the proposed division by directed punishments. We examine solutions to mitigate collusive bidding in the spectrum auctions, and then apply these ideas to the design of daily electricity auctions. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Regulatory Economics Springer Journals

Collusive Bidding: Lessons from the FCC Spectrum Auctions

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References (30)

Publisher
Springer Journals
Copyright
Copyright © 2000 by Kluwer Academic Publishers
Subject
Economics; Industrial Organization; Public Finance; Microeconomics
ISSN
0922-680X
eISSN
1573-0468
DOI
10.1023/A:1008174031940
Publisher site
See Article on Publisher Site

Abstract

The Federal Communications Commission (FCC) spectrum auctions use a simultaneous ascending auction design. Bidders bid on numerous communication licenses simultaneously, with bidding remaining open on all licenses until no bidder is willing to bid higher on any license. With full revelation of bidding information, simultaneous open bidding allows bidders to send messages to their rivals, telling them on which licenses to bid and which to avoid. These strategies can help bidders coordinate a division of the licenses, and enforce the proposed division by directed punishments. We examine solutions to mitigate collusive bidding in the spectrum auctions, and then apply these ideas to the design of daily electricity auctions.

Journal

Journal of Regulatory EconomicsSpringer Journals

Published: Oct 16, 2004

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