The U.S. Motion Pictures Industry: An Empirical Approach

The U.S. Motion Pictures Industry: An Empirical Approach We hypothesize that the U.S. motion pictures industry is structured so that star presence increases box office receipts and (less so) admissions, but places Ricardian limits on the output of blockbusters. The few dominant studios (majors) rely on a modified star system to generate supra-normal box office by stimulating admissions at exhibitors. Rising costs (from stars and their promotion) are required for rising revenues; that is, the majors gain revenue only at higher costs. Although the industry has unique features, the empirical results are surprisingly relevant to other industries. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Industrial Organization Springer Journals

The U.S. Motion Pictures Industry: An Empirical Approach

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Publisher
Springer Journals
Copyright
Copyright © 2001 by Kluwer Academic Publishers
Subject
Economics; Industrial Organization; Microeconomics
ISSN
0889-938X
eISSN
1573-7160
D.O.I.
10.1023/A:1011112032430
Publisher site
See Article on Publisher Site

Abstract

We hypothesize that the U.S. motion pictures industry is structured so that star presence increases box office receipts and (less so) admissions, but places Ricardian limits on the output of blockbusters. The few dominant studios (majors) rely on a modified star system to generate supra-normal box office by stimulating admissions at exhibitors. Rising costs (from stars and their promotion) are required for rising revenues; that is, the majors gain revenue only at higher costs. Although the industry has unique features, the empirical results are surprisingly relevant to other industries.

Journal

Review of Industrial OrganizationSpringer Journals

Published: Oct 3, 2004

References

  • The Market for Motion Pictures: Rank, Revenue, and Survival
    De Vany, A. S.; David Walls, W.

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