--- title: Hal Varian — definition & meaning | RGM® Glossary url: https://realgrowthmatters.com/glossary/hal-varian/ updated: 2026-06-10 source_html: https://realgrowthmatters.com/glossary/hal-varian/ --- # Hal Varian Hal Va·ri·an/hæl ˈvɛːriən/proper noun · person The economist who designed and famously explained Google’s ad auction — and argued that extracting value from data would be the defining skill of the era. Name : Hal R. Varian Role : Chief Economist, Google (since 2002) Field : Economics · ad auctions · data Known for : Designing & explaining the Google ad auction ## Who he is Hal Varian is an American economist who joined Google in 2002 and became its chief economist. He spent decades as an academic first — he is now emeritus professor at the University of California, Berkeley — and his textbook *Intermediate Microeconomics* taught the subject to a generation. With Carl Shapiro he co-wrote *Information Rules*, a foundational text on the economics of the digital economy. ## What he is known for At Google, Varian helped shape and refine the auction that decides which ads show and what advertisers pay: a [generalized second-price auction](/learn/concepts/vickrey-auction-google-ads/) descended from the [Vickrey auction](/glossary/vickrey-auction/). He also became its public explainer — his short talks walking through Ad Rank, the second-price rule and Quality Score remain the clearest introduction to how the system works, which is why RGM treats his auction explainer as required viewing in [Paid Search Mastery](/training/paid-search-mastery/google-ads-account-architecture/). ## Why he matters for paid search Varian helped build the marketplace every Google advertiser competes in. Understanding his work explains the single most important mechanic in the channel: you don’t pay your bid, you pay just enough to beat the advertiser below you, divided by your Quality Score — so relevance lowers your cost and raises your rank at once. Everything downstream, from match-type discipline to value-based bidding, is a consequence of the auction he helped design. ## In his own words “The ability to take data — to understand it, to process it, to extract value from it, to visualize it, to communicate it — that’s going to be a hugely important skill in the next decades.” — Hal Varian, McKinsey Quarterly (2009) Often paraphrased as “the sexy job in the next ten years will be statisticians,” the line proved prescient. For paid search it is close to a job description: the lever that wins the auction is not a bigger bid but better data — measuring the right conversions, valuing them honestly, and feeding that signal back to bidding. ## Career & background Varian earned his doctorate in economics from UC Berkeley and taught at Michigan and Berkeley, where he founded the School of Information. He joined Google as a consultant in 2002 — just as AdWords was becoming the company’s engine — and rose to chief economist, advising on auction design, policy and strategy through the era that made paid search the largest advertising channel in the world. ## Usage trends Search interest for “Hal Varian” over the last five years: [View interest-over-time on Google Trends →](https://trends.google.com/trends/explore?q=Hal%20Varian&date=today%205-y) ## Common questions Who is Hal Varian? : An American economist, Google’s chief economist since 2002 and emeritus professor at UC Berkeley, who helped design and famously explained the Google ad auction. Did Hal Varian invent the second-price auction? : No — that was William Vickrey in 1961. Varian helped adapt the second-price principle into Google’s generalized second-price auction and became its best-known explainer. What is his most famous quote? : That the ability to take data and extract value from it would be a hugely important skill in the coming decades — often shortened to “the sexy job will be statisticians.” ## Resources & work - book*Intermediate Microeconomics* — Hal R. Varian - book*Information Rules* — Carl Shapiro & Hal R. Varian - video[Introduction to the Google Ad Auction](https://www.youtube.com/watch?v=tW3BRMld1c8) — Varian explains the mechanism ## Related training - module[Account architecture](/training/paid-search-mastery/google-ads-account-architecture/) — opens with the auction Varian explains - concept[The Vickrey auction in Google Ads](/learn/concepts/vickrey-auction-google-ads/) ## Related terms [Vickrey auction](/glossary/vickrey-auction/)[Avinash Kaushik](/glossary/avinash-kaushik/)[Frederick Vallaeys](/glossary/frederick-vallaeys/)[Quality Score](/glossary/quality-score/) ## Sources 1. press[The New York Times — “For Today’s Graduate, Just One Word: Statistics” (2009)](https://www.nytimes.com/2009/08/06/technology/06stats.html) 2. interview[McKinsey Quarterly — Hal Varian (2009)](https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/hal-varian-on-how-the-web-challenges-managers) 3. profile[UC Berkeley — faculty page](https://people.ischool.berkeley.edu/~hal/)