In addition to software engineers, computer scientists and web designers, Silicon Valley giants ranging from Yahoo to Google to eBay are scrambling to hire economists, a little-known and increasingly valuable weapon as these companies create new businesses and fine-tune existing ones.

In the wake of the example of University of California-Berkeley economist Hal Varian, who helped Google perfect the auction process behind its multibillion-dollar search advertising revenue stream, big Internet companies are competing to woo economists away from universities, or work with them on specific projects.

Yahoo has been among the most aggressive, but eBay, Amazon.com, Facebook and other companies also are recruiting practitioners of what used to be called "the dismal science." Illustrating how crucial companies think those skills are, Microsoft CEO Steve Ballmer personally recruited economist Susan Athey from Harvard.