When publishers sell impressions, advertisers cannot target viewers without information from the publisher. By withholding information from advertisers (or limiting their ability to make contingent bids), the publisher can pool impressions for a given advertiser. Pooling impressions increases market thickness but reduces efficiency. We show that it is optimal for the publisher to pool high value impressions, in order to maintain market competition, but separate low value impressions, to maintain efficiency. (Joint work with Stephen Morris, MIT, and Tibor Heumann, PUC Chile)
Ansprechpartnerin: Marina Chugunova