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| Content Provider | ACM Digital Library |
|---|---|
| Author | Kash, Ian A. Roberts, Ben Gunawardena, Dinan Key, Peter |
| Copyright Year | 2016 |
| Abstract | In a sponsored search auction, decisions about how to rank ads impose tradeoffs between objectives, such as revenue and welfare. In this article, we examine how these tradeoffs should be made. We begin by arguing that the most natural solution concept to evaluate these tradeoffs is the lowest symmetric Nash equilibrium (SNE). As part of this argument, we generalise the well-known connection between the lowest SNE and the VCG outcome. We then propose a new ranking algorithm, loosely based on the revenue-optimal auction, that uses a reserve price to order the ads (not just to filter them) and give conditions under which it raises more revenue than simply applying that reserve price. Finally, we conduct extensive simulations examining the tradeoffs enabled by different ranking algorithms and show that our proposed algorithm enables superior operating points by a variety of metrics. |
| Starting Page | 1 |
| Ending Page | 21 |
| Page Count | 21 |
| File Format | |
| ISSN | 21678375 |
| e-ISSN | 21678383 |
| DOI | 10.1145/2910576 |
| Volume Number | 4 |
| Issue Number | 3 |
| Journal | ACM Transactions on Economics and Computation (TEAC) |
| Language | English |
| Publisher | Association for Computing Machinery (ACM) |
| Publisher Date | 2016-06-15 |
| Publisher Place | New York |
| Access Restriction | One Nation One Subscription (ONOS) |
| Subject Keyword | Sponsored search Generalized second price Keyword auctions Reserve price |
| Content Type | Text |
| Resource Type | Article |
| Subject | Economics and Econometrics Marketing Computational Mathematics Statistics and Probability Computer Science |
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