 The Price of Position: Spatial Equilibrium in the Geostationary ArcAlexander F. Wagner No 22052, CEPR Discussion Papers from Centre for Economic Policy Research Abstract: How costly is uniform congestion pricing when locations differ in value? I study geostationary orbit, where satellites supported $77 billion in satellite-television revenue in 2023 but international coordination leaves congestion unpriced. I estimate a spatial model of commercial entry from recorded satellite positions. The optimal uniform charge recovers 66 percent of the attainable welfare gain (79 percent under an income measure), only if it may close marginal positions: a charge keeping every occupied position open recovers 2 to 18 percent. When networks share orbital capacity equally, free entry dissipates commercial rents, so closures sacrifice no existing commercial surplus. Where incumbents keep protected capacity or concentrated fleets internalize congestion, rents survive and uniform pricing is less effective. Longitude-specific charges recover the remaining gain, mostly at positions the uniform charge keeps active. The welfare cost of one price depends on the surplus exposed to its errors, not just dispersion in efficient fees. Keywords: Spatial; equilibrium (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:22052 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK. |
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