The German 4G Spectrum Auction: Design and Behaviour

20 Pages Posted: 25 Oct 2017

See all articles by Peter Cramton

Peter Cramton

University of Maryland - Department of Economics

Axel Ockenfels

University of Cologne - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: October 2017

Abstract

The 2010 German 4G spectrum auction was an unusually large simultaneous ascending multi‐band auction. The bidding was competitive and the final assignment was efficient. However, our analysis suggests that independent and rational bidders had an opportunity to coordinate implicitly on a low‐revenue outcome. Coordination was difficult, though, because of a multiplicity of focal points. One important focal point involved post‐auction negotiations, posing risks to bidders and the auctioneer. We analyse different bidding scenarios and how post‐auction negotiations can affect values, bidding and efficiency. We also discuss how the simultaneous ascending auction format can be augmented to mitigate the risks.

Suggested Citation

Cramton, Peter C. and Ockenfels, Axel, The German 4G Spectrum Auction: Design and Behaviour (October 2017). The Economic Journal, Vol. 127, Issue 605, pp. F305-F324, 2017. Available at SSRN: https://ssrn.com/abstract=3058404 or http://dx.doi.org/10.1111/ecoj.12406

Peter C. Cramton (Contact Author)

University of Maryland - Department of Economics ( email )

College Park, MD 20742
United States
301-405-6987 (Phone)
301-405-3542 (Fax)

Axel Ockenfels

University of Cologne - Department of Economics ( email )

Albertus Magnus Platz
Cologne 50923
Germany

HOME PAGE: http://ockenfels.uni-koeln.de/

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Register to save articles to
your library

Register

Paper statistics

Downloads
0
Abstract Views
63
PlumX Metrics