Research Seminar by Irina Suleymanova (DIW Berlin): "Beef Up Your Competitor: A Model of Advertising Cooperation between Internet Search Engines"

Monday, April 27 ICEF held the Research Seminar.
Presenter: Irina Suleymanova - Deutsches Institut fur Wirtschaftsforschung (DIW Berlin), Humboldt Universitat zu Berlin, and Higher School of Economics

Topic: "Beef Up Your Competitor: A Model of Advertising Cooperation between Internet Search Engines" (pdf)

Abstract: We propose a duopoly model of competition between internet search engines endowed with dierent technologies and study the e¤ects of an agreement where the more advanced shares its technology with the inferior one. We show that the superior enters the agreement only if it results in a large enough increase in demand for advertising space at the competing and a relatively small improvement of the competitors search quality. Although the superior gains market share the agreement is benecial for the inferior as the later s additional revenues from a higher advertising demand outweigh its losses due to a smaller user pool. If the cooperation takes place it is likely to be in line with the advertisers interests and to be detrimental to users welfare.

Venue: Pokrovski Bulvar, 11, room Zh-822

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