Internet Advertising and the Generalized Second Price Auction

The podcast features a presentation on internet advertising and the generalized second price auction, a mechanism used by search engines like Google and Yahoo. The speaker explains the auction's mechanics, its evolution from first-price auctions, and its differences from the Vickrey-Clarke-Groves (VCG) auction. The presentation explores the stability and efficiency of the generalized second price auction, addressing questions about click-through rates, bidding strategies, and potential revenue optimization. The speaker also touches on open questions, such as whether search engines should use VCG or GSP, the importance of click-through rates, and how bidders learn and converge to an equilibrium.