Why do markets boom and crash? Why do fads and social norms start and end? The answer is found in a branch of social science literature called “cascade theory.” Cascade theory explains the observable human behavior of imitation: following the actions of someone else simply because one has...

The practice of sponsored search advertising - where advertisers pay a fee to appear alongside particularWeb search results - is now one of the largest and fastest growing source of revenue for Web search engines. We model and compare several mechanisms for allocating sponsored slots, including...