Review of Industrial Organization 23: 157–174, 2003.
© 2003 Kluwer Academic Publishers. Printed in the Netherlands.
Economic Analysis at the Federal Communications
, JONATHAN LEVY
, WILLIAM SHARKEY
and SIMON WILKIE
FCC Ofﬁce of Strategic Planning and Policy, Washington D.C.;
FCC Media Bureau, Washington
California Institute of Technology, Pasadena CA. Currently serving as FCC Chief Economist
Abstract. This article reviews some of the major economic issues faced by the FCC in the last year.
It focuses on the application of new analytic techniques at the FCC, and identiﬁes several areas in
which further academic research would be valuable to the FCC.
Key words: Auctions, diversity measure, experimental economics, Federal Communications Com-
mission, media ownership, merger simulation, regulation, spectrum policy.
The Federal Communications Commission (FCC) has responsibility for ensur-
ing that the telecommunications, broadcast and cable television, radio, and direct
broadcast satellite (DBS) service markets perform in a manner that is consistent
with statutory objectives. Economic efﬁciency is often a key component of these
statutory objectives. Thus, economics has a central role to play in the development
of public policies related to these markets. FCC economists have the responsibility
to identify important economic issues, provide methodologies for evaluating these
issues, and apply such methodologies in an effort to inform ﬁnal decisions on
important policy matters.
The purpose of this article is to describe some of the economic analyses conduc-
ted by the FCC in 2002–2003 and to identify areas of future research that would be
valuable to the FCC. The emphasis is on policy issues that involve the adoption of
new economic tools and techniques by the FCC. A comprehensive overview of the
role of economic analysis at the FCC, and the broader policy agenda of the FCC’s
current Chairman, Michael Powell, is provided in Kwerel et al. (2002). This article
will focus the speciﬁc implementation of some of the issues raised in Kwerel et al.
Author for correspondence: Dr. Mark Bykowsky, Ofﬁce of Strategic Planning and Policy, Fed-
eral Communications Commission, Room 7-C363, 445 12tb St. SW, Washington D.C. 20554, U.S.A.
Phone: 202-418-1695; Fax: 202-418-2807; E-mail:Mark.Bykowsky@fcc.gov