Ownership Concentration and Strategic Supply Reduction
We explore the implications of ownership concentration for the recently concluded incentive auction that re-purposed spectrum from broadcast TV to mobile broadband usage in the U.S. We document significant multi-license ownership of TV stations. We show that in the reverse auction, in which TV stations bid to relinquish their licenses, multi-license owners have an incentive to withhold some TV stations to drive up prices for their remaining TV stations. Using a large-scale valuation and simulation exercise, we find that this strategic supply reduction increases payouts to TV stations by between 13.5% and 42.4%.
-
-
Copy CitationUlrich Doraszelski, Katja Seim, Michael Sinkinson, and Peichun Wang, "Ownership Concentration and Strategic Supply Reduction," NBER Working Paper 23034 (2017), https://doi.org/10.3386/w23034.Download Citation
-
Published Versions
Ulrich Doraszelski & Katja Seim & Michael Sinkinson & Peichun Wang, 2025. "Ownership Concentration and Strategic Supply Reduction," American Economic Review, vol 115(3), pages 903-944.
Related
More from the NBER
In addition to working papers, the NBER disseminates affiliates’ latest findings through a range of free periodicals — the NBER Reporter, the NBER Digest, the Bulletin on Health, and the Bulletin on Entrepreneurship — as well as online conference reports, video lectures, and interviews.
