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Does advertising lower the price of newspapers to consumers? A theoretical appraisal

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  • Gabszewicz, Jean J.
  • Laussel, Didier
  • Sonnac, Nathalie

Abstract

We study whether advertising subsidizes consumers newspapers, prices. Using a model representingthe two-sided network effects between the advertising and printed media industries, we show that theanswer should be nuanced according to the readership,s attitude toward advertising.

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File URL: http://www.sciencedirect.com/science/article/B6V84-4FB940J-1/2/938682b0229c413dab8b2c602abbf0e8
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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 87 (2005)
Issue (Month): 1 (April)
Pages: 127-134

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Handle: RePEc:eee:ecolet:v:87:y:2005:i:1:p:127-134

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  1. Jean-Charles Rochet & Jean Tirole, 2003. "Platform Competition in Two-Sided Markets," Journal of the European Economic Association, MIT Press, vol. 1(4), pages 990-1029, 06.
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Cited by:
  1. Filistrucchi, L. & Antonielli, M., 2012. "Collusion and the Political Differentiation of Newspapers," Discussion Paper 2012-014, Tilburg University, Tilburg Law and Economic Center.
  2. Feng Zhu, 2008. "Ad-sponsored Business Models and Compatibility Incentives of Social Networks," Working Papers 08-20, NET Institute, revised Sep 2008.
  3. Buehler, Stefan & Halbheer, Daniel, 2012. "Persuading consumers with social attitudes," Journal of Economic Behavior & Organization, Elsevier, vol. 84(1), pages 439-450.
  4. Stefan Bühler & Daniel Halbheer, 2010. "Selling When Brand Image Matters," University of St. Gallen Department of Economics working paper series 2010 2010-14, Department of Economics, University of St. Gallen.
  5. Kind, Hans Jarle & Nilssen, Tore & Sørgard, Lars, 2005. "Financing of Media Firms: Does Competition Matter?," Memorandum 01/2005, Oslo University, Department of Economics.
  6. Lola Esteban & José Hernández, 2012. "Specialized advertising media and product market competition," Journal of Economics, Springer, vol. 106(1), pages 45-74, May.
  7. Ramon Casadesus-Masanell & Feng Zhu, 2009. "Strategies to Fight Ad-sponsored Rivals," Working Papers 09-09, NET Institute, revised Sep 2009.

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