In Google we trust?
Ramon Caminal () and
Matthew Ellman ()
UFAE and IAE Working Papers from Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC)
In a micro-founded model, we derive novel incentives for a monopoly search engine to distort its organic and its sponsored results on searches for online content and offline products. Distorting organic results towards content publishers with less effective display advertising and/or distorting sponsored results towards higher margin merchants (by underweighting consumer relevance in search auctions) increase per capita revenues but lower participation. The interplay of these incentives determines search bias and welfare. We also characterize how the welfare consequences of integration into display advertising, as intermediary or publisher, depend on asymmetries, monopolization and targeting.
Keywords: Search engine bias; internet economics; vertical integration; two-sided markets; antitrust (search for similar items in EconPapers)
JEL-codes: L13 L41 L82 L86 (search for similar items in EconPapers)
Date: 2013-09-27, Revised 2014-02-12
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Journal Article: In Google we trust? (2015)
Working Paper: In Google We Trust? (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:aub:autbar:935.13
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