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The Strategic Effects of Vertical Market Structure: Common Agency and Divisionalization in the US Motion Picture Industry

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Author Info
Kenneth S. Corts

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Abstract

I examine the release-date scheduling of all motion pictures that went into wide release in the US in 1995 and 1996 to investigate the effects of vertical market structure on competition. The evidence suggests that complex vertical structures involving multiple upstream or downstream firms generally do not achieve efficient outcomes in movie scheduling. In addition, analysis of the data suggests that the production divisions of the major studios act as integrated parts of the studio, rather than as independent competing firms. Copyright (c) 2001 Massachusetts Institute of Technology.

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Article provided by Blackwell Publishing in its journal Journal of Economics & Management Strategy.

Volume (Year): 10 (2001)
Issue (Month): 4 (December)
Pages: 509-528
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Handle: RePEc:bla:jemstr:v:10:y:2001:i:4:p:509-528

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  1. Darren Filson, 2003. "Dynamic Common Agency, Vertical Integration, and Investment: The Economics of Movie Distribution," Claremont Colleges Working Papers 2003-07, Claremont Colleges. [Downloadable!]
  2. Ricard Gil & Wesley Hartmann, 2007. "The Role and Determinants of Concession Sales in Movie Theaters: Evidence from the Spanish Exhibition Industry," Review of Industrial Organization, Springer, vol. 30(4), pages 325-347, June. [Downloadable!] (restricted)
  3. Darlene C. Chisholm & Margaret S. McMillan & George Norman, 2006. "Product Differentiation and Film Programming Choice: Do First-Run Movie Theatres Show the Same Films?," NBER Working Papers 12646, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Darlene Chisholm, 2005. "Hollywood Economics: How Extreme Uncertainty Shapes The Film Industry," Journal of Cultural Economics, Springer, vol. 29(3), pages 233-237, August. [Downloadable!] (restricted)
  5. Liran Einav (Stanford University), 2004. "Not All Rivals Look Alike: An Empirical Model for Discrete Games with Asymmetric Rivals," Econometric Society 2004 North American Winter Meetings 626, Econometric Society. [Downloadable!]
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