Advertising Disclosures: Measuring Labeling Alternatives in Internet Search Engines
Benjamin G. Edelman
Harvard University - HBS Negotiations, Organizations and Markets Unit
Duncan S. Gilchrist
Harvard University - Department of Economics; Harvard Business School
January 13, 2012
Harvard Business School NOM Unit Working Paper No. 11-048
In an online experiment, we measure users’ interactions with search engines, both in standard configurations and in modified versions with clearer labels identifying search engine advertisements. In particular, for a random subset of users, we change “Sponsored links” or “Ads” labels to instead read “Paid Advertisements.” Relative to users receiving the “Sponsored link” or “Ad” labels, users receiving the “Paid Advertisement” label click 25% and 27% fewer advertisements, respectively. Users seeing “Paid Advertisement” labels also correctly report that they click fewer advertisements, controlling for the number of advertisements they actually click. Results are most pronounced for commercial searches, and for vulnerable users with low education and little online experience.
Number of Pages in PDF File: 27
Keywords: Internet advertising, search engines, disclosure, regulation, consumer protection, survey methods
JEL Classification: L51, L86, M37, M38, C83working papers series
Date posted: November 11, 2010 ; Last revised: January 25, 2012
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