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We consider two scenarios for adding open access spectrum to increase competition in a wireless service market: making new spectrum available for unlicensed use or requiring an incumbent license holder to share it with secondary providers. Our main result is that social welfare and consumer welfare with shared spectrum are always greater than with unlicensed access. Also when the amount of spectrum is large enough, the primary service provider gains more profit with sharing than with unlicensed access.

Competition with Open Spectrum Access: Sharing vs. Unlicensed Access