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Proceedings of the 10th ACM conference on Electronic commerce
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SODA '10 Proceedings of the twenty-first annual ACM-SIAM symposium on Discrete Algorithms
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Management Science
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Proceedings of the 21st international conference on World Wide Web
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Electronic Commerce Research and Applications
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A game- heoretic machine learning approach for revenue maximization in sponsored search
IJCAI'13 Proceedings of the Twenty-Third international joint conference on Artificial Intelligence
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Decision Support Systems
Balanced allocation mechanism: An optimal mechanism for multiple keywords sponsored search auctions
Information Sciences: an International Journal
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We examine sponsored search auctions run by Overture (now part of Yahoo!) and Google and present evidence of strategic bidder behavior in these auctions. Between June 15, 2002, and June 14, 2003, we estimate that Overture's revenue might have been higher if it had been able to prevent this strategic behavior. We present an alternative mechanism that could reduce the amount of strategizing by bidders, raise search engines' revenues, and increase the efficiency of the market. We conclude by showing that strategic behavior has not disappeared over time; it remains present on both search engines.