Hal R. Varian

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The main thesis of this book is that while technology may change, economic laws do not. The authors, Carl Shapiro and Hal Varian point out that the information economy is driven by advances in information technology and infrastructure. What is new is, not the total amount of information available but our ability to manipulate information across industries.(More)
Recommender systems assist and augment this natural social process. In a typical recommender system people provide recommendations as inputs, which the system then aggregates and directs to appropriate recipients. In some cases the primary transformation is in the aggregation; in others the system’s value lies in its ability to make good matches between the(More)
System reliability often depends on the effort of many individuals, making reliability a public good. It is well-known that purely voluntary provision of public goods may result in a free rider problem: individuals may tend to shirk, resulting in an inefficient level of the public good. How much effort each individual exerts will depend on his own benefits(More)
The rapid advance in information technology now makes it feasible for sellers to condition their price offers on consumers’ prior purchase behavior. In this paper we examine when it is profitable to engage in this form of price discrimination. Our baseline model involves rational consumers with constant valuations for the good being sold and a monopoly(More)
We describe the basic economic theory of pricing a congestible resource such as an ftp server, a router, a Web site, etc. In particular, we examine the implications of “congestion pricing” as a way to encourage efficient use of network resources. We explore the implications of flat pricing and congestion pricing for capacity expansion in centrally planned,(More)
The field of economic mechanism design has been an active area of research in economics for at least 20 years. This field uses the tools of economics and game theory to design “rules of interaction” for economic transactions that will, in principle, yield some desired outcome. In this paper I provide an overview of this subject for an audience interested in(More)
One prominent feature of information goods is that they have large fixed costs of production, and small variable costs of reproduction. Cost-based pricing makes little sense in this context; value-based pricing is much more appropriate. Different consumers may have radically different values for a particular information good, so techniques for differential(More)
E-commerce will undoubtedly change the way business is done. But as we have said elsewhere, “technology changes, economic laws do not.” Despite the changes introduced by e-commerce, many of the fundamental principles of competition will still be relevant. In this paper I investigate three aspects of competition in ecommerce: marketing, interconnection, and(More)