Ownership Concentration and Strategic Supply Reduction

Ulrich Doraszelski, Katja Seim, Michael Sinkinson and Peichun Wang

American Economic Review, 2025, vol. 115, issue 3, 903-44

Abstract: We explore the implications of ownership concentration for the recently concluded incentive auction that repurposed spectrum from broadcast TV to mobile broadband usage in the United States. We document significant multilicense ownership of TV stations. We show that in the reverse auction, in which TV stations bid to relinquish their licenses, multilicense owners have an inventive 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 percent and 42.4 percent.

JEL-codes: D44 D47 H82 L13 L82 L88 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1257/aer.20162018

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