The Consumer Welfare Effects of Online Ads: Evidence from a 9-Year Experiment

Brynjolfsson and his Microsoft Research collaborators ran a nine-year experiment measuring how online advertising affects consumer welfare — not just click-through rates or conversion metrics, but actual economic value to users. This connects directly to the measurement problem that runs through the library: how do you quantify the value of digital products beyond what markets capture? The advertising economy is where this question becomes most acute, since the product (search, social media, content) is free to users but funded by attention markets. For product directors this offers a rigorous framework for thinking about value creation versus value capture in platform businesses, and experimental methods for measuring welfare effects that don't show up in traditional business metrics.