The Value of Internet Search: Time Saved vs. Quality

Mon, 02 Dec 2013 19:00:00 -0500

Current empirical literature in the field of industrial organization relies on census, observational and survey data to assess the impact of IT on productivity. Such studies have examined the impact of IT on either worker productivity or firm-level productivity in specific domain areas or industries. Beyond productivity, Goolsbee and Klenow (2006) estimate consumer welfare gains from the Internet by using not only how much money consumers spent on access but also the amount of leisure time they spent online, using a survey data set. In comparison, our study investigates the impact of search technology on productivity in everyday life, using individual level data obtained from a real-effort experiment. Therefore, our estimates are more accurate compared to previous studies. It pushes the frontier of productivity estimations. While designing and conducting the study, two doctoral students and several REU students were actively involved, thus, learning the basics of conducting real-effort experiments.