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November 6, 2009

Economist's View - 5 new articles

Paul Krugman: Obama Faces His Anzio

The failure to give the economy the fiscal stimulus it needs may be costly Democrats:

Obama Faces His Anzio, by Paul Krugman, Commentary, NY Times: Remember those Republican boasts that they would turn health care into President Obama's Waterloo? Well, exit polls suggest that to the extent that health care was an issue in Tuesday's elections, it worked in Democrats' favor. But while health care won't be Mr. Obama's Waterloo, economic policy is starting to look like his Anzio.
True, the elections weren't a referendum on Mr. Obama. Most voters focused on local issues... Yet there was a national element to the election. Voters ... are in a bad mood, largely because of the still-grim economic situation. And when voters are feeling bad, they turn on whomever currently holds office. ...
This bodes ill for the Democrats in the midterm elections next year ... because all indications are that ... unemployment will still be painfully high. And Republicans may well benefit, despite having become the party of no ideas.
Which brings me to the Anzio analogy.
The World War II battle of Anzio was a classic example of the perils of being too cautious. Allied forces landed far behind enemy lines, catching their opponents by surprise. Instead of following up on this advantage, however, the American commander hunkered down in his beachhead — and soon found himself penned in by German forces on the surrounding hills, suffering heavy casualties.
The parallel with current economic policy runs as follows: early this year, President Obama came into office with a strong mandate and proclaimed the need to take bold action on the economy. His actual actions, however, were cautious... They were enough to pull the economy back from the brink, but not enough to bring unemployment down.
Thus the stimulus bill fell far short of what many economists — including some in the administration itself — considered appropriate. ... Meanwhile, the administration balked at proposals to put large amounts of additional capital into banks, which would probably have required temporary nationalization of the weakest institutions. ...
Administration officials would presumably argue that they were constrained by political realities... But they never tested that assumption, and they also never gave any public indication that they were doing less than they wanted. The official line was that policy was just right, making it hard to explain now why more is needed.
And more is needed. Yes, the economy grew fairly fast in the third quarter — but not fast enough to make significant progress on jobs. And there's little reason to expect things to look better going forward. The stimulus has already had its maximum effect on growth. ... Many economists predict that the economy's growth, such as it is, will fade out over the course of next year.
The problem is that it's not clear what Mr. Obama can do about this prospect. Conventional wisdom in Washington seems to have congealed around the view that budget deficits preclude any further fiscal stimulus — a view that's all wrong on the economics, but that doesn't seem to matter. Meanwhile, the Democratic base, so energized last year, has lost much of its passion, at least partly because the administration's soft-touch approach to Wall Street has seemed to many like a betrayal of their ideals.
The president, then, having failed to exploit his early opportunities, is pinned down in his too-small beachhead.
If the Democrats lose badly in the midterms, the talking heads will say that Mr. Obama tried to do too much, this is a center-right nation, and so on. But the truth is that Mr. Obama put his agenda at risk by doing too little. The fateful decision, early this year, to go for economic half-measures may haunt Democrats for years to come.


"The Great Contraction of 2008-2009"

Kenneth Rogoff doesn't expect a "sustained sharp" worldwide recovery:

The Great Contraction of 2008-2009, by Kenneth Rogoff, Commentary, Project Syndicate: A popular view among economic forecasters and market bulls is that "the deeper the recession, the quicker the recovery." They are right – up to a point: immediately after a normal recession, economies do, indeed, often grow much faster than usual... Unfortunately, the Great Recession of 2008-2009 is far from being a normal global recession. The Great Recession was turbo-charged by a financial crisis,... a far more insidious affair that typically has far more long-lasting effects.
As Carmen Reinhart and I argue..., the Great Recession is better described as "The Great Contraction," given the massive ... contraction of global credit, trade, and growth that the world has experienced. ... [T]he legacy of the huge contraction in credit is not likely to go away anytime soon. ... The optimists say not to worry. Credit will soon come to everyone else as easily as it has to the banks. ...
But this ... fails to recognize the fact that balance sheets remain ... impaired... Housing prices are being propped up temporarily by myriad subsidies, while a commercial real-estate tsunami looms. Many banks' weaknesses are simply being masked by government guarantees.
Indeed, G-20 governments now face the daunting prospect of trying to rein in the monster they have created. It is now very clear that the taxpayer will always be there to guarantee that bondholders get paid. ... Lenders to banks will not bother worrying about what kinds of gambles ... financial institutions are making, or whether regulation is effective.
The good news is that most governments do see the need to implement significant new regulation on financial firms. But here's the rub: financial regulation is enormously complicated...[I]f regulators take their time to "get it right," there will be a huge shadow of uncertainty hanging over the financial system. Banks know that they face higher capital requirements... But how much higher? There is much discussion of breaking up banks that are too big to fail. But what will actually happen?
Given this environment, no wonder credit is still contracting... If banks don't know what the rules of the game are going to be, they have to be very cautious about over-extending their balance sheets.
So government regulators – and ultimately all of us – are caught... Overly strict regulation could seriously impair global growth for decades. But if regulation is too soft, the next monster global financial crisis could come within a decade. And even if regulators take their time to try to get it right,... the world may have to live with weak credit expansion as banks hold back, awaiting a clearer verdict on their future. ...
I am often asked why economies get themselves into such a bind again and again throughout economic history. Unfortunately,... the answer is all too simple: arrogance and ignorance. Investors and policymakers are often altogether ignorant of the myriad historical experiences with financial crises. And the few that are dimly aware of what has happened in other times and other places all too often say, "Don't worry, this time is different."

Perhaps the Great Contraction of 2008-2009 will be different from other deep financial crises, and we will see a sustained sharp recovery worldwide. But G-20 policymakers are best advised not to bet on it...

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"A Modern World System?"

Globalization from a different perspective:

A modern world-system?, by Daniel Little: Immanuel Wallerstein created a huge stir in the 1970s with the publication of The Modern World-System: Capitalist Agriculture and the Origins of the European World-Economy in the Sixteenth Century (1974). The book is an intellectual masterpiece, synthesizing a vast range of fundamental literature on the economic history of Europe and the world. You could look at the book as the first serious and extended effort to theorize globalization -- a term that barely existed at the time of publication. Or you could look at it as a general theory of colonialism -- an account of the pathways and influences through which the metropole dominated and exploited the periphery. It is worth looking back at this work today to tease out some of the guiding assumptions about history, sociology, and globalization it reflected. The concept of "world system" is itself a key component of our current understanding of globalization, in that it captures the idea of causal interconnectedness across the globe among major organizations, firms, populations, and states. Wallerstein observes that earlier social scientists had usually centered their analysis at the level of the political unit -- the nation-state; whereas his own approach is different:
This book makes a radically different assumption. It assumes that the unit of analysis is an economic entity, the one that is measured by the existence of an effective division of labor, and that the relationship of such economic boundaries to political and cultural boundaries is variable, and therefore must be determined by empirical research for each historical case. Once we assume that the unit of analysis is such a "world-system" and not the "state" or the "nation" or the "people", then much changes in the outcome of the analysis. (xi)
But what, more exactly, did he mean by a system?
Did he imagine something analogous to a mechanical system in which the relations among the parts were governed by a few simple laws? He seems to suggest this possibility when he asks the question, "What do astronomers do? As I understand it, the logic of their arguments involves two separate operations. They use the laws derived from the study of smaller physical entities, the laws of physics, and argue that ... these laws hold by analogy for the system as a whole. Second, they argue a posteriori. If the whole system is to have a given state at time y, it most porrobably had a certain state at time x" (7). Here he seems to suggest that social systems are tied together by the working of governing laws -- a particularly unconvincing starting point. But Wallerstein's practice as a sociologist is far more defensible than this language would suggest. He was in fact sensitive to causal heterogeneity, contingency, and variation in the systemic relations he meant to capture -- particularity as well as universality. So he doesn't actually treat the modern world system as if it were analogous to a set of gravitational objects governed by fixed laws of nature. I think the clue to an answer to his working definition of a system is found in his definition of scope in terms of an "effective division of labor": a set of regions constitute a system in his framework if there is significant exchange and dependence among various of the regions for products, people, knowledge, skills, and resources from other regions. If Europe, Asia, or the Americas had been "autarkic" in 1700 -- that is, if one or more of these continental regions had been a closed economy and society making no substantial use of products, knowledge, resources, or people from other regions -- then there would not have been one "world system" but rather several independent macro-regional systems. And Wallerstein explicitly affirms this point late in the book:
By saying that in the sixteenth century there was a European world-economy, we indicate that the boundaries are less than the earth as a whole. But how much less? We cannot simply include in it any part of the world with which "Europe" traded. In 1600 Portugal traded with the central African kingdom of Monomotapa as well as with Japan. Yet it would be prima facie hard to argue that either Monomotapa or Japan were part of the European world-economy at that time. And yet we argue that Brazil (or at least areas of the coast of Brazil) and the Azores were part of the European world-economy. (199)
So in postulating the concept of world system as a framework for analysis of the modern period (let's say 1700), Wallerstein is laying a few important cards on the table; he is indicating his judgment that there was significant and necessary exchange among virtually all accessible places on the planet. There were economically meaningful movements of resources, people (emigrants and slaves), crops (cotton, sugar), finished products, and ideas throughout the system of places defining the system of transport and trade. This in turn implies that we cannot properly understand the workings of the regional economy without taking into account its exchange relations with other regions -- or in other words, we need to place the regional economy into the system of international division of labor in which it is located. And in fact, historians like Ken Pomeranz make a substantial case for the empirical accuracy of that judgment (see for example The Great Divergence: China, Europe, and the Making of the Modern World Economy and The World That Trade Created: Society, Culture, And the World Economy, 1400 to the Present). If we begin with this assumption -- the idea of the substantial interdependence of continental regions in the early modern period -- then we are naturally drawn to the question, what were the terms of trade? Was exchange among regions mutually beneficial, as trade theory would have it? Or was it extractive and exploitative, as the theory of colonialism would have it? This is where Wallerstein makes substantial use of the core-periphery framework in his analysis.
The periphery of a world-economy is that geographical sector of it wherein production is primarily of lower-ranking goods ... but which is an integral part of the overall system of the division of labor, because the commodies involved are essential for daily use. The external arena of a world-economy consists of those other world-systems with which a given world-economy has some kind of trade relationship ... what was sometimes called the "rich trades." (199-200)
Wallerstein was particularly interested in interconnections between places that were the expression of power and commerce. Core and periphery are linked by relations of subordination -- military and economic domination, leading to the persistent disadvantage of the latter in favor of the former. These features define the "general attributes of a colonial situation" (5). This analysis lays a theoretical and historical foundation for a theory of globalization. Wallerstein writes late in the book:
One of the persisting themes of the history of the modern world is the seesaw between "nationalism" and "internationalism." I do not refer to the ideological seesaw ... but to the organizational one. At some points in time the major economic and political institutions are geared to operating in the international arena and feel that local interests are tied in some immediate way to developments elsewhere in the world. At other points of time, the social actors tend to engage their efforts locally, tend to see the reinforcement of state boundaries as primary, and move toward a relative indifference about events beyond them. (147)
Where has the effort to theorize globalization gone in the thirty-five years since Wallerstein's book appeared? A particularly important contemporary voice on this subject is that of Saskia Sassen. Her recent A Sociology of Globalization (2007) represents a current cutting-edge effort to provide a vocabulary and set of theoretical premises in terms of which to understand the global interconnectedness that characterizes the contemporary world. And she wants to provide a sociology of these processes -- that is, she wants to provide a theoretical vocabulary and a set of hypotheses about the causal mechanisms that are involved that are adequate to the problem of describing and explaining the workings of this system. One thing this means is providing a framework within which the empirical details and structures of global networks can be investigated. Another key point in her approach is her attention to differentiation across institutions and mechanisms. A deeply important part of her analysis is her effort to overturn the assumption of "linearity" and hierarchy among levels of analysis -- the line of thought that assumes that neighborhoods are encompassed by cities, which fall within regions, which fall within states, which fall within international relations. She argues repeatedly and effectively that this linear scheme doesn't work for today's global relationships. The local neighborhood may be implicated in extra-national relations of immigration, crime, and trade that make it a global place. More importantly, what she calls "global cities" have crucial relationships at many levels in these supposed hierarchies -- local, national, and supra-national. So the question of scale cannot be defined within a simple hierarchy of relationships of locality, nationality, and globality. (Significantly, Wallerstein opens his treatment of the modern world system by wrestling with this issue -- a discussion that he frames in terms of the idea of the appropriate unit of analysis in considering colonialism.) Sassen is particularly interested in the networks of communication, finance, and service organizations that constitute the fabric joining what she calls "global cities" (link; see also an earlier posting on regional interdependence). But in this book Sassen broadens considerably the angle of view in order to consider social networks at many levels of scale, including sub-national as well as supra-national. Sassen makes an important point about international economic power that has a Wallerstein-like feel to it but that would probably not have been true in 1700 or 1970. This is her view that there has been an important process of "de-nationalization" that has removed traditional powers of the state and placed them in the scope of international economic and finance institutions that are significantly controlled by large economic actors and firms. We sometimes refer to this process as one of "liberalization"; Sassen makes the point that the construction of the new supra-national regulatory regimes is an extended historical process that can be studied in detail. She refers to the result of this process as the global corporate economy. One of Wallerstein's key arguments is that nations in the periphery were dominated and controlled by an economic system run by European nations. Sassen argues for the reality of a world system of regulatory arrangements that subordinates the sovereignty of even previously hegemonic nations to a non-democratic set of institutions and rules that implicitly favor one set of economic actors over others. But Sassen's inference from this fact about international economic power is less about north-south exploitation and more about the rising likelihood of global exploitation of all ordinary citizens by powerful extra-national economic forces that are beyond the reach of democratic processes (what she refers to as the "democratic deficit").

Sassen's book warrants a close reading. It proposes a significantly different way of conceptualizing the meaning of globalization, and one that will suggest many new research agendas.

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"Search Technologies and Retail Competition"

Has internet search technology achieved its promise of frictionless commerce?

Search Technologies and Retail Competition, by Glenn Ellison,* NBER Reporter: When the Internet first came into wide consumer use, one heard a lot about the promise of "frictionless commerce." New search technologies would make it easy for consumers to find the exact product they wanted at the lowest possible price. Whether such a future comes to pass is obviously of great interest to consumers and online retailers. And, it may have dramatic effects on the traditional retail and media sectors. My recent research has included several projects that aim to improve our understanding of Internet search technologies and retail markets.
Price Search and Obfuscation
The desire to better understand where search frictions come from and how they may evolve motivates my work with Sara Fisher Ellison on Pricewatch. Pricewatch is a specialty search engine serving consumers who want to buy computer parts (such as memory upgrades or video cards) at low prices from no-name e-retailers. One chooses the desired product from a menu on Pricewatch's first page -- for example, 128 MB PC100 SDRAM memory module -- and Pricewatch returns a list, sorted by price, of dozens of retailers carrying that product. A number of retailers have built businesses by serving Pricewatch consumers, and price competition occurs far more quickly this way than in the traditional retail sector: rankings on the Pricewatch list change throughout the day as firms raise or lower prices by a few dollars to move up or down.
Our choice to study this idiosyncratic environment may seem strange, but it illustrates how empirical work is often done in industrial organization. Developing theoretical models of the interactions between consumers and firms is the only way to address many important questions. Studying atypical environments can be a great way to get insights on how accurate models are. In our case, the simplicity of the business model of a Pricewatch retailer – basically, they just take memory modules off a shelf, put them in cardboard boxes, and mail them – makes it much easier to estimate profit functions. The frequent changes in relative prices let us estimate demand using (presumably random) short-term fluctuations. And, the generic nature of the products and retailers creates extremely price-sensitive demand, which highlights the role played by search frictions in sustaining markups.
From our first look at the Pricewatch environment it was clear that the frictionless ideal had not been fully realized.1 Yes, prices were very low and close together. But buying a product at the advertised price was rarely simple. Often, one had to search through multiple pages and read a great deal of fine print. Most striking was the litany of automated sales pitches encouraging one to upgrade to a superior product and/or buy additional add-ons to complement what one was trying to buy. We use the term "obfuscation" to describe practices by firms that increase search frictions, and we view Pricewatch as a great environment from which to gain insights on the topic.
I explore these ideas in two theoretical papers as well as in the empirical work mentioned above. The first theoretical paper examines add-on pricing.2 The ubiquity of add-on pricing in the Pricewatch universe mirrors what one sees in many traditional businesses with high fixed costs and minimal product differentiation: for instance, hotels have extremely high long-distance rates; rental car companies have high refueling charges; and bank accounts often have a remarkably long list of fees. This regularity is made more striking by the fact that arguably such fees should have no effect on equilibrium profits. If firms are able to earn an extra $17 from each consumer by selling add-ons, then the equilibrium price in the market should simply end up $17 lower, and nothing important will change. The model I develop for why add-ons may raise profits, though, is quite simple. There are two types of consumers: regular consumers and cheapskates, who have a higher marginal utility of income. Price cuts disproportionately attract cheapskates. Ordinarily, this is not a problem – a cheapskate's money is as good as anyone else's – but when a firm relies on selling add-ons for its profits, then it is a problem, analogous to adverse selection. The adverse selection is a disincentive to price-cutting, which leads to higher equilibrium markups. This paper also involves behavioral industrial organization – it notes that one way to make the add-on pricing individually rational rather than just collectively rational for the firms is to add a small population of irrational consumers who buy add-ons only when the high add-on prices are not advertised.
The second theoretical paper, written with Alexander Wolitzky, makes the level of search costs endogenous in a standard search-theoretic model. We discuss two mechanisms that may make it individually rational for firms to make searches more time consuming.3 One mechanism assumes that some consumers don't want to spend much time shopping. In such a model, firms will have an incentive to make examining their product slightly more arduous than consumers expect, and to simultaneously raise prices. Because the time already spent examining a product is a sunk cost, it won't deter consumers from finishing their examination of a firm's product, but it will raise the perceived incremental cost of visiting another firm. The other mechanism that firms use is a signal-jamming model in which making search more arduous similarly makes continued search less attractive by increasing consumer expectations about how difficult future searches will be.
Our empirical work on the Pricewatch search engine exploits data that are unusually rich in some dimensions. Most notably, we were able to download the prices at which memory modules were available from dozens of firms indexed by Pricewatch at an hourly frequency over the course of a year. We then matched this to hourly quantity data from two e-retail websites that get most of their traffic from Pricewatch referrals. The price and quantity data make clear that Pricewatch dramatically reduces some search frictions. In one product category, we estimate that a firm that raises its prices by one percent will lose one-fourth of its sales. But the cost data make clear that search frictions are far from completely eliminated. Firms appear to maintain markups over marginal cost of 8-16 percent.
Further analyses indicate that each of the mechanisms discussed in the theoretical papers is operative. For example, we can measure the adverse selection problem that add-on pricing creates. A single-percent price decline can substantially reduce a firm's average margin because it raises total sales by 20 percent, but only increases sales of add-ons by about 10 percent. Indeed, the actual markups appear to be very consistent with the estimated magnitude of the adverse selection. Relative to the search-cost model, we find that consumers have not found the most relevant information -- the prices at which they could have bought the product they ended up buying.
Overall, these results support the view that the equilibrium level of search frictions is determined by a balance of search technologies and firms' investments in obfuscation. This balance is reflected in the practices that have not received much attention, but have long been found in places like the hotel, rental car, and banking industries. Price search may become more efficient than it is in the current online world, but we would not expect that the "frictionless" ideal will be closely approached.
Sales Taxes and Online-Offline Competition
Sara Fisher Ellison and I have also used our Pricewatch data to examine the effects of sales taxes on e-retail sales.4 Sales tax policies are potentially important to the future of traditional and online retail. The status quo is that state governments are unable to compel retailers without a presence in their states to collect sales taxes or to provide information that would allow the state to levy "use taxes." As a result, an attractive feature of buying from small online merchants (or even Amazon) is the de facto tax free status of purchases. Not surprisingly, state governments and traditional retailers are unhappy about this situation and are pursuing a variety of avenues to change it.
Our work exploits another very nice feature of the online sales environment. The retailers listed on Pricewatch set prices at the national level. However, the tax-inclusive price a consumer would pay to purchase from each retailer depends on the consumer's location. Our sales data include the home-state of each purchaser, so rather than just observing national market shares as a function of national prices, we are able to simultaneously observe market shares in 50 different states as a function of 50 different tax-inclusive price orderings.
We analyze the data from a variety of angles. In one analysis, we collapse everything into a simple regression on a 51-observation state-level dataset. In another, we treat sales into each state in each hour as a separate observation and estimate a discrete choice model on a dataset with 800,000 observations. The results are fairly consistent. We find that consumers do not react as strongly to differences in sales taxes as they do to differences in pre-tax item prices. Nonetheless, we find that sales patterns are strongly influenced by taxes: a single percentage point higher sales tax rate leads to a 6 percent decrease in online sales by in-state merchants.
We make a number of other observations about online and offline retail. Geography still matters in e-retail for two reasons: consumers prefer purchasing from nearby merchants to take advantage of reduced shipping times; and, there is an additional preference for in-state merchants that offsets some of the tax disadvantage. We also look for effects of the variation in the online-offline price gap which occurs over the course of a week (because online prices adjust more rapidly to market conditions), but we fail to find evidence that consumers react to such transitory differences. This also could be a sign of "behavioral" consumers: consumers appear generally to be aware of the tax advantages of buying online, but do not exploit more subtle patterns that can be equally important in some circumstances.
Sponsored Search Auctions
If price search will not come to dominate the online (and offline) environment, what will? Today, most consumers find products either by visiting merchants they know and/or by using general search engines like Google. A common way to use Google is to search for the product one is interested in buying and then to examine the offers from merchants contained in the list of "sponsored links" presented above and alongside the unbiased search results. One's first reaction may be that this process couldn't possibly be as efficient as searching for products via Pricewatch, but there is circumstantial evidence that it must be at least somewhat effective: enough consumers choose to search this way to generate $10 billion dollars in annual revenues for the firms that sell-off the right to be a sponsored link. The functioning of this retail "platform" is also of interest to the traditional media that it is displacing, and to the increasing number of firms that rely heavily on online advertising.
Previous work on search engines has developed elegant auction-theoretic models of the process by which Google, Yahoo!, Bing, and others auction off the right to be a "sponsored link."5 My work with Susan Athey extends this research to explore the implications of the fact that service providers such as Google are not just auctioning generic "objects" – they are auctioning advertisements that derive their value from the fact that consumers believe that they are sufficiently likely to be valuable to make clicking on them worthwhile.6 Our approach assumes that potential advertisers are heterogeneous in the probability that they will be able to meet a consumer's need. The genius of the sponsored-search auction is that it may lead to a sorting equilibrium where the firms that are most likely to meet a consumer's need are able to outbid other firms on a per click basis. Hence, it is the fact that the auctioneer is collecting revenue that induces firms to reveal their quality, which allows consumers to search in a more efficient manner.
Although these auctions work well in a base case, the majority of our paper explores various ways in which the considerations underlying auction design become more subtle. For example, reserve prices can increase the volume of trade by making clicking worthwhile, and using weights to adjust for differences in click-through rates is critical if one wants to approximate efficiency, but involves a number of tradeoffs. In a short time, sponsored search has become one of the most active topics in computer science as well as in economics, and many new results are emerging.
* Ellison is a Research Associate in the NBER's Program on Industrial Organization and a professor at MIT.
1. G. Ellison and S. F. Ellison, "Search, Obfuscation, and Price Elasticities on the Internet," NBER Working Paper No. 10570, June 2004, and Econometrica 77, 2009, pp.427-52.
2. G. Ellison, "A Model of Add-On Pricing," NBER Working Paper No. 9721, May 2003, and Quarterly Journal of Economics, 120, 2005, pp.585-637.
3. G. Ellison and A. Wolitzky, "A Search Cost Model of Obfuscation," NBER Working Paper 15237, August 2009. The paper builds on D. Stahl, "Oligopolistic Pricing with Sequential Consumer Search," American Economic Review 79, 1989, pp.700-12.
4. G. Ellison and S. F. Ellison, "Internet Retail Demand: Taxes Geography, and Online-Offline Competition," NBER Working Paper No. 12242, May 2006. Part of this work is forthcoming as G. Ellison and S. F. Ellison, "Tax Sensitivity and Home State Preferences in Internet Purchasing," American Economic Journal: Economic Policy, 2009
5. See G. Aggarwal, A. Goel, and R. Motwani, "Truthful Auctions for Pricing Search Keywords," ACM Conference on Electronic Commerce, 2006; B. Edelman, M. Ostrovsky, and M. Schwarz, "Internet Advertising and the Generalized Second-Price Auction: Selling Billions of Dollars Worth of Keywords, American Economic Review 97, 2007, pp. 242-59; and H. Varian, "Position Auctions," International Journal of Industrial Organization, 25, 1997, pp. 1163-78.

6. S. Athey and G. Ellison, "Position Auctions with Consumer Search," NBER Working Paper 15253, August 2009.

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