Optimal quality scores in sponsored search auctions: Full extraction of advertisers' surplus

Kiho Yoon

doi:10.2202/1935-1704.1649

Optimal quality scores in sponsored search auctions: Full extraction of advertisers' surplus

Kiho Yoon

Department of Economics

Research output: Contribution to journal › Article › peer-review

5 Citations (Scopus)

Abstract

This paper shows that the quality scores in sponsored search auctions can be optimally chosen to extract all the advertisers' surplus. The reason for the full extraction result is that the quality scores may effectively set all the bidders' valuations equal to the highest valuation, which induces intense bidding competition.

Original language	English
Article number	28
Journal	B.E. Journal of Theoretical Economics
Volume	10
Issue number	1
DOIs	https://doi.org/10.2202/1935-1704.1649
Publication status	Published - 2010

Keywords

full extraction
online advertising
quality score
sponsored search

ASJC Scopus subject areas

Economics, Econometrics and Finance(all)

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10.2202/1935-1704.1649

Cite this

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abstract = "This paper shows that the quality scores in sponsored search auctions can be optimally chosen to extract all the advertisers' surplus. The reason for the full extraction result is that the quality scores may effectively set all the bidders' valuations equal to the highest valuation, which induces intense bidding competition.",

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Optimal quality scores in sponsored search auctions: Full extraction of advertisers' surplus

Abstract

Keywords

ASJC Scopus subject areas

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