Correspondence: Anindya Ghose, IOMS Department, Stern School of Business, New York University, 44 West 4th Street, New York, NY 10012

¹is an assistant professor of information, operations and management sciences at New York University's Leonard N. Stern School of Business. His research studies the monetisation of user-generated and vendor-generated content through Web 2.0, and the welfare impact of the internet on industries transformed by its shared infrastructure. Before joining NYU Stern, Dr Ghose worked in Finance with GlaxoSmithKline, as a product manager with HCL-Hewlett Packard and as a senior e-business consultant with IBM. He has a B.Tech in Engineering from the Regional Engineering College in Jalandhar, and an MBA in finance, marketing and systems from the Indian Institute of Management, Calcutta. He received his MS and PhD in information systems from Carnegie Mellon University's Tepper School of Business.

²is an assistant professor at the Department of Information, Operations and Management Sciences at Leonard N. Stern School of Business of New York University. His area of expertise is databases and information retrieval, with an emphasis on management of textual data. He received his PhD in Computer Science from Columbia University in 2004, and a BSc from the Computer Engineering and Informatics Department (CEID) of the University of Patras, Greece in 1999.

Received 28 October 2008; Revised 28 October 2008.

Abstract

An important use of the internet today is in providing a platform for consumers to disseminate information about products and services they buy, and share experiences about the merchants with whom they transact. Increasingly, online markets develop into social shopping channels, and facilitate the creation of online communities and social networks. Till date, businesses, government organisations and customers have not fully incorporated such information in their decision making and policy formulation processes, either because the potential value of the intellectual capital or appropriate techniques for measuring that value have not been identified. Increasingly, although, this publicly available digital content has concrete economic value that is often hidden beneath the surface. For example, online product reviews affect the buying behaviour of customers, as well as the volume of sales, positively or negatively. Similarly, user feedback on sites such as eBay and Amazon affect the reputation of online merchants and, in turn, their ability to sell their products and services. Our research on the EconoMining project studies the economic value of user-generated content in such online settings. In our research program, we combine established techniques from economics and marketing with text mining algorithms from computer science to measure the economic value of each text snippet. In this paper, we describe the foundational blocks of our techniques, and demonstrate the value of user-generated content in a variety of areas, including reputation systems and online product reviews, and we present examples of how such areas are of immediate importance to the travel industry.