Tech Firms Turn to Experimental Economists

Wired Magazine:

Within the last three years, both Google and Yahoo have built in-house economics facilities of their own to work on such tasks as optimizing their keyword auctions, and dozens of other companies have turned to outside consultants for help on specific projects. EBay used experimental economists to develop a new seller-feedback system that wound up boosting the total value of goods sold on the site by 25 percent, according to the researcher who worked on the project.

Read the whole thing.

The article does mention Nobel Prize winner Vernon Smith, who recently left GMU for Chapman University. I will forever regret not taking a class with him before he left.

(HT Will McBride)