Publication:
You will: a macroeconomic analysis of digital advertising

dc.contributor.coauthorGreenwood, Jeremy
dc.contributor.coauthorMa, Yueyuan
dc.contributor.departmentDepartment of Economics
dc.contributor.kuauthorYörükoğlu, Mehmet
dc.contributor.schoolcollegeinstituteCollege of Administrative Sciences and Economics
dc.date.accessioned2024-12-29T09:39:36Z
dc.date.issued2024
dc.description.abstractAn information-based model is developed where traditional and digital advertising finance the provision of free media goods and affect price competition. Digital advertising is directed toward specific consumers while traditional advertising is undirected. The equilibrium is suboptimal. Media goods, if valued by the consumer, are under provided with both types of advertising. Additionally, traditional advertising is excessive because it is undirected. The tax-cum-subsidy policy that overcomes these inefficiencies is characterized. The model is calibrated to the U.S. economy. Through the lens of the calibrated model, digital advertising increases welfare significantly. The welfare gain from the optimal policy is much smaller than the gain from digital advertising.
dc.description.indexedbyWOS
dc.description.openaccessGreen Submitted, hybrid
dc.description.publisherscopeInternational
dc.description.sponsoredbyTubitakEuN/A
dc.description.sponsorshipYou Will refers to AT&T's 1994 advertising campaign. It introduced the first clickable ad. Four referees provided useful comments. The Editor, Kurt Mitman, gave excellent advice. They are all thanked. This research was supported by the National Science Foundation (grant number 2044117).
dc.identifier.doi10.1093/restud/rdae067
dc.identifier.eissn1467-937X
dc.identifier.issn0034-6527
dc.identifier.quartileQ1
dc.identifier.urihttps://doi.org/10.1093/restud/rdae067
dc.identifier.urihttps://hdl.handle.net/20.500.14288/23064
dc.identifier.wos1268880200001
dc.keywordsAT&T's "you will" advertising campaign
dc.keywordsConsumer welfare
dc.keywordsDigital and traditional advertising
dc.keywordsDirected and undirected advertising
dc.keywordsFree media goods
dc.keywordsGDP measurement
dc.keywordsLeisure
dc.keywordsInformation frictions
dc.keywordsPrice competition
dc.keywordsPublic policy
dc.language.isoeng
dc.publisherOxford University Press
dc.relation.grantnoNational Science Foundation (NSF) 2044117
dc.relation.ispartofReview of Economic Studies
dc.subjectEconomics
dc.titleYou will: a macroeconomic analysis of digital advertising
dc.typeJournal Article
dspace.entity.typePublication
local.contributor.kuauthorYörükoğlu, Mehmet
local.publication.orgunit1College of Administrative Sciences and Economics
local.publication.orgunit2Department of Economics
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relation.isParentOrgUnitOfPublication.latestForDiscovery972aa199-81e2-499f-908e-6fa3deca434a

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