Pot of gold or winner's curse? An event study of the auctions of 3G mobile telephone licences in the UK

John Cable, Andrew Gordon Henley, Kevin Holland

Research output: Contribution to journalArticlepeer-review

10 Citations (SciVal)

Abstract

Commentators have suggested that the winning companies in the UK 3G mobile telephone auction overpaid for their licences. However, event-study method using the market model under ordinary least squares (OLS), robust and structural time-series estimation yields no systematic evidence of the ‘winner's curse’. Positive as well as negative one-day wealth effects are observed amongst both winners and losers, and there is no lasting adverse market reaction to the winners, taken as a group. We conclude there is no case for easing the regulatory stance in the industry on grounds that the winners paid too much.
Original languageEnglish
Pages (from-to)447-462
JournalFiscal Studies
Volume23
Issue number4
DOIs
Publication statusPublished - Dec 2002

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