At the recent Ad Auctions Workshop, I had a paper (PDF) and talk (PDF) that argued for discounting relevant advertisements more than we currently do.
To briefly summarize, if seeing bad ads causes people to look at ads less in the future (aka ad fatigue), then we should change our pricing in advertising auctions to promote relevant, useful ads. Likewise, we should charge bad ads more to compensate for the damage they cause.
The paper is not trying to be definitive. The paper only shows that ad fatigue could matter, not that it does actually matter. More work needs to be done to measure how much ad fatigue actually exists.
But, I hope this paper might motivate others to look more at ad fatigue, think more about long-term revenue instead of short-term revenue, and consider how it might be beneficial in the long-term to lower our pricing on relevant and useful advertisements.
The paper was done with Chris Meek from Microsoft Research and Max Chickering at Microsoft. It reports on a side project I did a year ago while at Microsoft Live Labs.