Crocioni, Pietro and Franzoni, Luigi Alberto. (2011) Transmitters and receivers' investment to avoid interference : is there an optimal regime? Telecommunications Policy, Vol.35 (No.6). pp. 568-578. ISSN 03085961

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Abstract

The management of interference has been, and still is. the main concern in spectrum policy. Historically, interference has been dealt with by heavy regulation under an administrative control regime. Over the last decades, a new approach has been put forward based on users' property rights, better able to cope with a rapidly changing technological environment. The issue of dealing with interference across bands, however, remains crucial: What obligations should be put on users so as to keep interference at a socially acceptable level? Also, given that some unwanted emissions are bound to occur, how can private parties be provided with the right incentives to invest in high-quality reception technology? This paper assesses how well different regulatory regimes can lead to efficient outcomes. It develops an economic model of spectrum interference and identifies the efficient solution. A regime where spectrum users have the power to enjoin intruding emissions beyond a predefined level (property rights protection) is compared with a regime where users are forced to bear with intruding emissions, but are entitled to economic compensation for the harm suffered (liability rules protection). The analysis suggests that different regimes may perform differently under different circumstances depending on the cause of interference and, critically, on whether the services are organised as an open- or a close-architecture system. This suggests that regulators should pay more attention to the specific features of the different bands, and that the appropriate spectrum management regime should be designed to recognise these differences.

Item Type:	Journal Article
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HE Transportation and Communications H Social Sciences > HG Finance
Divisions:	Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH):	Wireless communication systems -- Economic aspects, Radio -- Interference -- Prevention, Radio frequency allocation, Telecommunication -- International cooperation, Right of property, Investment analysis
Journal or Publication Title:	Telecommunications Policy
Publisher:	Pergamon
ISSN:	03085961
Date:	July 2011
Volume:	Vol.35
Number:	No.6
Page Range:	pp. 568-578
Identification Number:	10.1016/j.telpol.2011.04.003
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access
URI:	http://wrap.warwick.ac.uk/id/eprint/38773

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