Controlled markets for spectrum management

The electromagnetic spectrum is apportioned among various radio services and users by centralized authority. A combination of judicial procedures and system engineering methods are used, even to the level of assigning [1] channels to users within a given service. However, as demand for spectrum is increasing, some inefficiencies of this process are becoming evident. The user has little incentive to use spectrum efficiently because using less spectrum often requires greater investment without compensating reductions in operating costs. The goal of economic efficiency, in contrast, requires a balanced use of resources, rather than minimal use of spectrum. In this paper, several techniques are presented which rely on marketplace forces to move toward economic efficiency, and could be implemented within the current spectrum management framework. Incentives would be created for improved efficiency and equity.