Game theory as a framework for estimating the market value of roadside rights of way. An application to ITS and telecommunication industries in Spain.

In Spain, the National Highway Administration (Direccion General de Carreteras - DGC) is committed to an ambitious ITS program for the years 2000-2003. A theoretical approach to the network valuation problem is explained, using a combination of games in strategic form (Nash equilibrium) with a microeconomic analysis of the oligopoly (model of Cournot). Both analytical tools are useful to assign a market value to the roadside rights of way, helping authorities to manage their negotiations with telecom companies and therefore allowing them to share physical infrastructure and network facilities (trenches, ducts, even fiber) among ITS and public telecom networks. An application of this new method to the high capacity roads in Spain is also presented, including the results of a benchmarking valuation within different market scenarios. For the covering abstract see ITRD E114174.