ESSAYS IN INTERNET ECONOMICS
Search engines are considered a crucial link between the firms and the consumers, since their job is to match the two. There are two regimes that the search engines subscribe to while displaying the search results in response to a consumer's keyword based search query: the unbiased regime and the biased regime. The unbiased regime is based on the relevancy of the consumer's keywords to the keywords supplied by the firms' web sites, and is free of cost. Whereas, under the biased regime, the search engine requires the firms to buy from it the keywords that are relevant to the identification of one's web site. This dissertation emphasizes the importance of the first page of the search result for both the firms and the search engines, while analyzing the business practices of a biased search engine. The first essay primarily deals with the analysis of the issues pertaining to securing a position in the first page of the search result, and the consequent well being of the firms that are not strategically linked to a search engine. An inverse relationship has been shown to exist between the size of the search engine and the total number of spots allocated to the non-member firms. The size of the search engine refers to the number of firms that are strategically linked to the search engine. A smaller sized search engine is more likely to serve the well being of the non-member firms while displaying the search results. Additionally, a smaller sized search engine is more likely to switch the search result regime from the unbiased to the biased, and in turn, more likely to serve the well being of the non-member firms as compared to any larger sized search engine. The second essay explores the impact of the improved search engine technology on a firm's decision variables; namely, the price-cost mark up and the reach to the consumers. It has been shown that the price-cost markup of a firm increases, and the reach to the consumers decreases as a result of an improved search engine technology. Moreover, brand proliferation is a possibility under the product category.
School:University of Cincinnati
School Location:USA - Ohio
Source Type:Master's Thesis
Keywords:internet economics search engines biased
Date of Publication:01/01/2002