Auctions work best and raise the most when...

Auctions work best and raise the most when restrictions aren’t placed on who can bid, said the Georgetown Center for Business and Public Policy in a white paper released Tuesday. “Even when all firms enjoy foreclosure value, and even in settings where some firms serve far more retail customers than other firms, unfettered auctions can maximize economic welfare,” the paper said (http://bit.ly/1cMbPB6). “When competitors perceive the same marginal value of spectrum, unfettered auctions can be relied upon to (i.e., they always) generate the welfare-maximizing allocation of inputs.” Spectrum auctions work because “in contrast to bureaucratic allocation methods, well-designed auctions typically ensure that the input is allocated to the users who value that input most highly,” the center said. The center is supported in part by AT&T and the Verizon Foundation. The two major carriers strongly oppose spectrum aggregation limits in the upcoming TV incentive and AWS-3 auctions.