Decarolis, Francesco, Goldmanis, Maris, Penta, Antonio and Shakhgildyan, Ksenia (2021) Bid Coordination in Sponsored Search Auctions: Detection Methodology and Empirical Analysis. TSE Working Paper, n. 21-1273, Toulouse

Warning
There is a more recent version of this item available.
[thumbnail of wp_tse_1273.pdf]
Preview
Text
Download (1MB) | Preview

Abstract

Bid delegation to specialized intermediaries is common in the auction systems used to sell internet advertising. When the same intermediary concentrates the demand for ad space from competing advertisers, its incentive to coordinate client bids might alter the functioning of the auctions. This study develops a methodology to detect bid coordination, and presents a strategy to estimate a bound on the search engine revenue losses imposed by coordination relative to a counterfactual benchmark of competitive bidding. Using proprietary data from auctions held on a major search engine, coordination is detected in 55 percent of the cases of delegated bidding that we observed, and the associated upper bound on the search engine’s revenue loss ranges between 5.3 and 10.4 percent.

Item Type: Monograph (Working Paper)
Language: English
Date: November 2021
Place of Publication: Toulouse
Uncontrolled Keywords: Online Advertising, Sponsored Search Auctions, Delegation, Common Agency
JEL Classification: C72 - Noncooperative Games
D44 - Auctions
L81 - Retail and Wholesale Trade; Warehousing; e-Commerce
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 06 Dec 2021 14:04
Last Modified: 03 Feb 2023 14:12
OAI Identifier: oai:tse-fr.eu:126199
URI: https://publications.ut-capitole.fr/id/eprint/44017

Available Versions of this Item

View Item

Downloads

Downloads per month over past year