Radio Spectra as Telecommunications Assets

This paper demonstrates that the measured wealth stock of the United States increases by $2 trillion in 2022 when radio spectra are included on the balance sheet. Furthermore, this paper also demonstrates that tracking radio spectra can impact the National Income and Product Accounts (NIPAs) noticeably. It may be true that radio spectra are not produced—and therefore do not impact measured investment. Similarly, radio spectra do not deteriorate with age—and therefore do not impact measured consumption of fixed capital. However, this paper argues that radio spectrum licenses which the federal government gives for “free” to the telecommunications industry should be tracked as a capital transfer in BEA’s NIPA table 3.1. These capital transfers are targeted towards new entrants and new products, and so they increase the competitiveness of the telecommunications industry.