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Integration and Search Engine Bias

Author

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  • Alexandre de Corniere
  • Greg Taylor

Abstract

Competition authorities all over the world worry that integration between search engines (mainly Google) and publishers could lead to abuses of dominant position. In particular, one concern is that of own-content bias, meaning that Google would bias its rankings in favor of the publishers it owns or has an interest in, to the detriment of competitors and users. In order to investigate this issue, we develop a theoretical framework in which the search engine (i) allocates users across publishers, and (ii) competes with publishers to attract advertisers. We show that the search engine is biased against publishers that display many ads - even without integration. Although integration may lead to own-content bias, it can also reduce bias by increasing the value of a marginal consumer to the search engine. Integration also has a positive effect on users by reducing the nuisance costs due to excessive advertising. Its net effect is therefore ambiguous in general, and we provide sufficient conditions for it to be desirable or not.

Suggested Citation

  • Alexandre de Corniere & Greg Taylor, 2013. "Integration and Search Engine Bias," Economics Series Working Papers 651, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:651
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    References listed on IDEAS

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    More about this item

    Keywords

    Search engine; integration; advertising;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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