Google calculated its economic benefits

Google chief economist Hal Varian (Hal Varian) yesterday at the Web 2.0 Expo conference gave an interesting presentation in which he calculated the importance of Google for the US economy. It turned out around $ 119 billion a year.

Value for advertisers is determined by the model vx - c (x) , where v = value per click, x = number of clicks, c (x) = cost of clicks. Thus, Google advertisers bring in about $ 54 billion a year.

The second component of the value of Google is to save users time to search for information. As shown by independent research , the search for information in the library on a given topic takes on average 22 minutes, while using Google found the same information on average in seven minutes. It turns out a saving of 15 minutes for each such “request”.
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Varian took into account in his calculations that the simpler the search query, the less time it saves the user, so the average savings per user, he estimates, is 3.75 minutes per day. Taking into account the average hourly wage in the USA ($ 22), it turns out that every citizen using Google saves $ 1.37 per day or about $ 500 per year, which gives the national economy $ 65 billion in savings per year.

The sum is $ 119 billion a year. According to Varian, this figure is certainly lower than the real one, because the economic “value of getting answers to questions is very important.”