How Block Booking Facilitated Self-Enforcing Film Contracts
AbstractThis paper uses the block-booking film exhibition contracts that were the subject of Paramount to examine the role of contract terms in facilitating self-enforcing relationships. Because of the large uncertainty in film value at the time of contracting, it is difficult to fully specify optimal exhibitor performance (such as exhibition run length) ex ante. Instead, the efficient contractual arrangement contractually overconstrains exhibitors and relies on the superior reputational capital of distributors to flexibly adjust contract terms ex post. The analysis illustrates that, rather than thinking of contracts as either court-enforced or self-enforced, transactors generally combine court-enforced and self-enforced sanctions by using contract terms to economize on their limited reputational capital. Block booking is explained within this framework by its effects on reducing the variance in the value of the film package and, therefore, the demands placed on the distributors' reputational capital. Copyright 2000 by the University of Chicago.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoArticle provided by University of Chicago Press in its journal Journal of Law & Economics.
Volume (Year): 43 (2000)
Issue (Month): 2 (October)
Contact details of provider:
Web page: http://www.journals.uchicago.edu/JLE/
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Elisabetta Iossa & Giancarlo Spagnolo, 2009.
"Contracts as Threats: on a Rationale For Rewarding A while Hoping For B,"
CEIS Research Paper
147, Tor Vergata University, CEIS, revised 30 Sep 2009.
- Iossa, Elisabetta & Spagnolo, Giancarlo, 2011. "Contracts as Threats: on a Rationale For Rewarding A while Hoping For B," CEPR Discussion Papers 8195, C.E.P.R. Discussion Papers.
- Elisabetta Iossa & Giancarlo Spagnolo, 2008. "Contracts as Threats: on a Rationale For Rewarding A while Hoping For B," EIEF Working Papers Series 1022, Einaudi Institute for Economics and Finance (EIEF), revised Dec 2010.
- 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.
- Moul, Charles C., 2008. "Retailer entry conditions and wholesaler conduct: The theatrical distribution of motion pictures," International Journal of Industrial Organization, Elsevier, vol. 26(4), pages 966-983, July.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division).
If references are entirely missing, you can add them using this form.