Pricing in position auctions and online advertising

M. Bumin Yenmez

Economic Theory, 2014, vol. 55, issue 1, 243-256

Abstract: Can search engines increase revenues by changing their position auctions? In this paper, I analyze position auctions with general pricing rules to answer this question. In these auctions, there are several items that are commonly ranked by bidders with unit demand. I show that revenues remain the same for position auctions with regular pricing rules where the price for an item depends on the bids of agents who win lower-ranked items. In addition, all of the bidders have the same ex post payoffs. I also show that regularity is a necessary condition to get ex post payoff equivalence. Copyright Springer-Verlag Berlin Heidelberg 2014

Keywords: Position auctions; Online advertising; Multidimensional types; Ex post payoff equivalence; C71; C78 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (7)

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DOI: 10.1007/s00199-013-0748-0

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