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The Economics of Internet Search

Author

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  • Hal R. Varian

Abstract

This lecture provides an introduction to the economics of Internet search engines. After a brief review of the historical development of the technology and the industry, I describe some of the economic features of the auction system used for displaying ads. It turns out that some relatively simple economic models provide significant insight into the operation of these auctions. In particular, the classical theory of two-sided matching markets turns out to be very useful in this context.

Suggested Citation

  • Hal R. Varian, 2006. "The Economics of Internet Search," Rivista di Politica Economica, SIPI Spa, vol. 96(6), November-.
    • Handle: RePEc:rpo:ripoec:v:96:y:2006:i:6:p:
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    File URL: http://www.rivistapoliticaeconomica.it/2006/nov_dic/pdf/Varian_eng.pdf
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    More about this item

    JEL classification:

    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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