24th European Regional Conference of the International Telecommunication Society, Florence, Italy, 20-23 October 2013
We describe the basic economic theory of cost model for network deployment and spectrum in wireless networks. In particular, we develop a production function for wireless networks. With this production function model, we explore the technical rate of substitution and the elasticity of substitution in the production function for wireless network and find its insight for wireless network. Finally, we compare the engineering value of spectrum and economic value of spectrum.