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Milgrom to Advise FCC on “Incentive Auctions”

March 27, 2012


“FCC Chairman Julius Genachowski said, ‘I am delighted to have this world-class team of experts advising the Commission on this historic undertaking.’ …. The team of auction experts is led by Auctionomics Chairman Paul Milgrom, the Ely Professor of Humanities and Sciences in the Department Economics at Stanford University, and a member of the National Academy of Sciences and the American Academy of Arts and Sciences. Milgrom is the recipient of Nemmers Prize in Economics for contributions dramatically expanding the understanding of the role of information and incentives in a variety of settings, including auctions, the theory of the firm, and oligopolistic markets. He is widely regarded as one of the foremost thinkers in auction theory and design, and he helped create the first FCC spectrum auction design, which has served as a blueprint for similar auctions worldwide.”

Milgrom leads an Auctionomics team that also includes Stanford professors Jonathan Levin and Ilya Segal and University of Maryland professor Lawrence Ausubel.

Mention in the New York Times

September 19, 2011

Paul’s 20-year-old research on incentives was mentioned in an article published on September 19 in the New York Times. According to the article,

Too much pressure to improve students’ test scores can reduce attention to other aspects of the curriculum and discourage cultivation of broader problem-solving skills, also known as “teaching to the test.” The economists Bengt Holmstrom and Paul Milgrom describe the general problem of misaligned incentives in more formal terms – workers who are rewarded only for accomplishment of easily measurable tasks reduce the effort devoted to other tasks.

Mention in Economist Magazine

September 16, 2011

Paul’s work as a bidding adviser is given a nice mention in the September 3, 2011 issue of The Economist magazine. According to the article,

“In the run-up to an online auction in 2006 of radio-spectrum licences by America’s Federal Communications Commission, Paul Milgrom, a consultant and Stanford University professor, customised his game-theory software to assist a consortium of bidders. The result was a triumph.

When the auction began, Dr Milgrom’s software tracked competitors’ bids to estimate their budgets for the 1,132 licences on offer. Crucially, the software estimated the secret values bidders placed on specific licences and determined that certain big licences were being overvalued. It directed Dr Milgrom’s clients to obtain a patchwork of smaller, less expensive licences instead. Two of his clients, Time Warner and Comcast, paid about a third less than their competitors for equivalent spectrum, saving almost $1.2 billion.”

The article unfortunately failed to mention that the this consulting project was a joint effort by three Stanford professors. The two others were Jonathan Levin and Jeremy Bulow.

Fishery Auctions in Chile

May 15, 2011

On May 9-10, Paul was in Santiago, Chile to advocate the creation of individual transferable fishing quotas (ITQs) and the use of auctions to assign at least half of them. (Chilean law authorizes auctions only for half of the fishing rights.) The use of auctions would not change the total allowable catch, but would open the door to new entry by more efficient firms. Currently, entry is blockaded by a handful of firms that control all the rights. Not only would auctions enhance efficiency, but they would also capture a portion of the value of fishing rights for the Chilean population, just as radio spectrum auctions have promoted efficiency and captured value in many countries.

El Mercurio newspaper published an interview with Paul on May 10, which can be found here.

Paul Speaks at the White House

April 7, 2011

On April 6, Paul Milgrom appeared at the White House on behalf of 112 economists to discuss the bipartisan “economists’ letter” to President Obama, which supports the use of “incentive auctions” to guide the voluntary redeployment of radio spectrum to higher value uses. The letter, signed by a distinguished group of economists including both Republicans and Democrats, explains the proper roles of users and regulators in assuring that spectrum is used efficiently, to promote jobs and growth and create a win-win solutions for existing users like TV broadcasters and possible new users like providers of wireless broadband services.

Paul speaking at White House, 6 April 2011

The panel discussion and the surrounding event were covered by various news outlets.