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| HAL: halshs-00575074, version 1 |
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| Targeted advertising with consumer search: an economic analysis of keywords advertising |
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| Alexandre De Cornière 1, 2 |
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| (2009-11) |
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| This article investigates the role of a search engine as an intermediary between firms and consumers. Search engines enable firms to target consumers who have revealed some specific needs through their query. In a framework with horizontal product differentiation, imperfect product information and in which consumers incur search costs, I show that introducing a "neutral" targeted advertising mechanism reduces social inefficiencies and tends to reduce the equilibrium price. Moreover, the accuracy of the mechanism has a non monotonic effect on the price of the good: the price is lowest when the accuracy is intermediate. |
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| 1: | Paris-Jourdan Sciences Economiques (PSE) |
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CNRS : UMR8545 – École des Hautes Études en Sciences Sociales [EHESS] – Ecole des Ponts ParisTech – Ecole normale supérieure de Paris - ENS Paris |
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| 2: | Ecole d'Économie de Paris - Paris School of Economics (EEP-PSE) |
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Ecole d'Économie de Paris |
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| Subject | : | Humanities and Social Sciences/Economy and finances |
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| search-engine – targeted advertising – consumer search – product differentiation |
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| halshs-00575074, version 1 | |
| http://halshs.archives-ouvertes.fr/halshs-00575074 | |
| oai:halshs.archives-ouvertes.fr:halshs-00575074 | |
| From: Caroline Bauer | |
| Submitted on: Wednesday, 9 March 2011 15:09:16 | |
| Updated on: Tuesday, 3 May 2011 22:20:17 | |
