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Maximum impact for minimum subsidy: reverse auctions for universal access in Chile and India

Irene S. Wu (Adjunct Professor at Department of Communications, Culture and Technology, Georgetown University, Washington, DC, USA; and International Bureau, Federal Communications Commission)


ISSN: 1463-6697

Article publication date: 5 August 2014




The purpose of this article is to discuss how minimum subsidy auctions have been implemented in Chile and India for Internet and mobile phone infrastructure to and identify lessons for governments considering reverse auctions as a tool. In a minimum subsidy auction (also known as a reverse auction), the government starts by offering the maximum funds available for a given public project; the company requiring smallest subsidy wins.


The article investigates several case studies of subsidy auctions in both Chile and India.


When firms compete for subsidies in reverse auctions, they have incentives to get the most result for the least funds. This furthers the government’s goal to achieve maximum public policy impact with minimum budget.


For developing countries, very little research has been done on implementation of auctions in the communications sector.



© Published 2014. This article is a US government work and is in the public domain in the USA.

The views in this paper are the author's own. However, this work benefited from the comments of Mindel De La Torre, Jerry Duvall, Carrie-Lee Early, Evan Kwerel, Patrick Boateng, Lily Hughes, Robert Tanner, Sharon Gillett and Carol Mattey. The author expresses thanks also to outside reviewers Bjorn Wellenius, Philip N. Howard and Rekha Jain.


S. Wu, I. (2014), "Maximum impact for minimum subsidy: reverse auctions for universal access in Chile and India", info, Vol. 16 No. 5, pp. 46-58.



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