Economics Dictionary of ArgumentsHome
| |||
|
| |||
| Auctions: Auctions are public sales where goods or services are offered to the highest bidder. Various types exist, like ascending (English), descending (Dutch), or sealed-bid formats. Auctions are used in diverse industries, from art and real estate to online marketplaces, facilitating efficient price discovery and allocation of items. See also Markets, Price, Allocation._____________Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments. | |||
| Author | Concept | Summary/Quotes | Sources |
|---|---|---|---|
|
Thomas W. Hazlett on Auctions - Dictionary of Arguments
Henderson I 19 Auctions/Hazlett/Henderson/Globerman: In University Economics(1), Alchian and co-author Willam R. Allen used property rights to explain the underpricing of tickets to the Rose Bowl. They noted that every year there is a large shortage of tickets to this event. Many people Who want them at the face price can't get them. Why does that happen? Private enterprise: At the time they wrote, the Rose Festival Association, which sold the tickets, was not privately owned. One third of the ticket receipts went to the association and one third went to each of the participating universities and their athletic conferences. But, they noted, "no person can claim any pro rata part ofthe proceeds as being 'his."' This simple fact, they noted, had huge implications. >Private sector, >Public sector. Prices: Why should the decision-makers price higher to reduce or eliminate the shortage when they don't get the gains from that action? Why not instead price Iow so that they can pay a Iower price than otherwise for their own tickets and sell tickets to their friends and associates Who are given first dibs? By doing so, they can be "invited to the best places, clubs, and circles." >Clubs. If this analysis were useful only for analyzing pricing of Rose Bowl tickets, it might be only an amusing example. But, as Alchian and Allen understood, it has far more widespread implications. Hazlett: Thomas W. Hazlett, a UCLA graduate who studies telecommunications markets and who was for a while the chief economist at the Federal Communications Commission (FCC), used the "Rose Bowl" analysis to understand the behaviour of a particularly powerful Congressman, John Dingell, a Democrat from Michigan. For many years, as chairman of the House Commerce Committee, Dingell opposed auctioning off valuable electromagnetic spectrum.* >Spectrum allocation. Instead, he wanted the FCC to give away the licenses for specific uses and for limited time periods. Why? Dingell had a lot of power over the FCC. But ifthe spectrum were auctioned off, the FCC's power would be less and so, therefore, would be Dingell's power. As Henderson put it in discussing Hazlett's* point: „When something is allocated to the highest bidder, the bidders, not the auctioneer, determine Who gets it. Therefore, Dingell, Who had a big oversight role over the FCC, would find his power over allocation dropping to zero also. Without that power, people wouldn't invite him to dinners and hunting parties as frequently, would contribute less to his campaign fund, and would return his calls less quickly, if at all. In short, he would be a less important man in Washington, and probably a less wealthy one.“(2) (2001: 65) *See also Hazlett (1990)(3) 1. Alchian, Armen A., and William R. Allen (1972). University Economics: Elements of Inquiry, 3rd Edition. Wadsworth Publishing Co. 2. Henderson, David R. (2001). The Joy of Freedom: An Economist’s Odyssey, Prentice-Hall. 3. Hazlett, Thomas W. (1990). The Rationality of U. S. Regulation of the Broadcast Spectrum. The Journal of Law and EconomicsVolume 33, Number 1._____________Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition. |
Hazlett I Thomas W. Hazlett The Fallacy of Net Neutrality New York: Encounter Books 2011 Henderson I David R. Henderson Steven Globerman The Essential UCLA School of Economics Vancouver: Fraser Institute. 2019 |
||
Authors A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Concepts A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
