%0 Report
        %A Cai, Xiaoming
%A Gautier, Pieter A.
%A Wolthoff, Ronald P.
        %T Platform-Controlled Search  and Distortions in Attention Allocation
        %D 2026
        %8 2026 Jun
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 18745
        %U https://www.iza.org/index.php/publications/dp18745
        %X Digital platforms allocate buyer attention across sellers that differ in quality and breadth of appeal. We study a monopoly platform that sets meeting rates between buyers and two seller types --- niche sellers whose high-quality good is valued by a fraction  of buyers and mass-market sellers whose good is valued by all. Sellers compete by posting prices à la Burdett and Judd (1983), so buyer surplus requires competition, while platform revenue requires seller rents. This difference creates a systematic distortion: as search capacity grows, the platform keeps high-quality niche attention just past the point where extra exposure stops creating rents and starts eroding them — its saturation point — and diverts the rest to mass-market sellers.  Applying the model to Amazon product search and Google passage-ranking data indicates that, for captive buyers, both platforms operate past the saturation point, with buyer-surplus losses of 63 and 44 percent of the planner’s benchmark, respectively. Allowing buyer participation to respond to the platform's recommendation strategy disciplines the platform and shrinks this loss.
        %K two-sided markets
%K search frictions
%K recommendation systems
%K attention allocation
%K enshittification of internet