This article examines a model in which advertisers bid for "sponsored-link" positions on a search engine. The value advertisers derive from each position is endogenized as coming from sales to a population of consumers who make rational inferences about firm qualities and search optimally....

This paper examines competitive price discrimination with horizontal and vertical taste differences. Consumers with higher valuations for quality are assumed to have stronger brand preferences. Two models are considered: a standard competitive price discrimination model in which consumers...

This paper studies whether agents must agglomerate at a single location in a class of models of two-sided interaction. In these models there is an increasing returns effect that favors agglomeration, but also a crowding or market-impact effect that makes agents prefer to be in a market with...

This paper studies the way that word-of-mouth communication aggregates the information of individual agents. The authors find that the structure of the communication process determines whether all agents end up making identical choices, with less communication making this conformity more likely....

We examine the labor market for mutual fund managers. Using data from 1992-1994, we find that "termination" is more performance-sensitive for younger managers. We identify possible implicit incentives created by the terminationperformance relationship. The shape of the termination-performance...

This paper analyzes monotone comparative statics predictions in several classes of stochastic optimization problems. The main results characterize necessary and sufficient conditions for comparative statics predictions to hold based on properties of primitive functions, that is, utility...

We study entry and bidding patterns in sealed bid and open auctions. Using data from the U.S. Forest Service timber auctions, we document a set of systematic effects: sealed bid auctions attract more small bidders, shift the allocation toward these bidders, and can also generate higher revenue....