I was already a big fan of Hal Varian‘s columns on everyday economics in the Times when I had the good fortune to meet him at Google headquarters, when Levitt and I were out there a couple of years ago. He was even more impressive in person. Now you have a chance to ask him whatever you’d like.
As Google’s chief economist, Varian brings to the table his trademark assertion that “technology changes — economic laws do not.” A Googler since 2002, he has been involved in many aspects of the company’s growth, including auction design, finance, corporate strategy, and public policy. He has also spent a lot of time in the classroom, serving as a professor and former dean at his alma mater, the University of California-Berkeley, as well as teaching at M.I.T., Stanford, Oxford, and Michigan.
His textbooks, Intermediate Microeconomics and Microeconomic Analysis, are staples in both undergraduate and graduate classrooms. He’s also the co-author of Information Rules: A Strategic Guide to the Network Economy.
In his spare time, he serves as a fellow of the Guggenheim Foundation, the Econometric Society, and the American Academy of Arts and Sciences, and spent three years as co-editor of the American Economic Review.
So post your questions for Varian below, and he’ll respond (as others have) in short course. Thanks to Hal for participating, and to you for asking.
[Note: The answers to these questions can be found here.]
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What do you see as the root causes of high health care costs in the USA. Which of these are amenable to correction? Which are not?
“Google’s mission is to organize the world’s information and make it universally accessible and useful.”
Historically, consumers have obtained news from only a few sources. The newspaper, newsreels prior to motion pictures, the radio, and the evening news broadcast. With the explosion of the Internet, 24/7 cable television, and wireless connectivity, our methods of obtaining content have changed drastically. No longer is news simply taken for granted, and is often blended with entertainment. Consumers have much more choice, both in terms of format and content, and often choose media which conforms to their particular bias or viewpoint.
How might traditional news media maintain relevance and profitably monetize content that Google makes available for free?
Prof. Varian,
How would you rate the future of experimental economics?
I haven’t read any studies on this (if there are any), but it seems to me that many consumers react to things being “free” in ways that are different from how we might predict. As an example, faced with the choice of two software products, one costing $5 and the other being free but “costing” 2 hours per month of lost efficiency versus the pay version, it seems to me many people would choose the free version. (I’m not suggesting that free products are necessarily worse – it’s just an example.) However, if you were to offer them the same $5 (one-time payment) in return for 2 hours of their time each month for, say, the next year, many of them would turn you down. (Again, this is my guess, but I think it’s right.)
This inconsistent behavior seems highly relevant in today’s as-supported world. What ways do you have of studying and predicting consumers’ decisions to use pay or ad-supported services?
Aside from auctions, what have been some of the applications of game theory to the internet or internet-related businesses? What role, if any, has game theory played in the area of computer/internet security?
Many argue that the mainstream, traditional media are biased. Even if true, that worries me far less than what appears to be their imminent demise, particularly at the local level. What’s the future for the hometown newspaper, and what mass medium, if any, will replace it?
In most economic PhD programs, passing the first year is dependent on understanding your book (or Mas-colell’s) completely. What effect do you think this weeding out process has on the characteristics of future research economists? As someone who failed out of a top PhD program because of micro, yet remained in the profession, I wonder: is is possible to be a successful economist (academic or otherwise) and not have a deep understanding of the mathematics behind microeconomic theory?
Do you think more PhDs in IO and marketing will migrate to jobs in the private sector (industry, not just the types of consulting that have always existed), in the way that those in finance have been for some time now?