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Cultural quotas in broadcasting II: policy

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Author Info
Martin Richardson ()

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Abstract

This paper considers the application of ‘cultural quotas’ to radio broadcasting: a requirement that a minimum percentage of broadcast content be of local origin. Using a Hotelling location model derived in Richardson (2004) we show that, while the laissez-faire solution involves less than (socially optimal) maximal differentiation, a quota reduces the differentiation between the stations even further. While a cultural quota may raise consumer welfare, the reduced station diversity and advertising levels monotonically lower overall social welfare. We consider two other policies – a limit on advertising and a publicly provided non-commercial station – and show that both also reduce diversity, compared to the laissez-faire solution. An advertising cap is not as effective as the quota in achieving greater airplay for local content for least welfare cost but a public station can be, depending on the magnitude of its associated fixed costs

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Publisher Info
Paper provided by Australian National University, College of Business and Economics, School of Economics in its series ANUCBE School of Economics Working Papers with number 2004-443.

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Length: 27 pages
Date of creation: Jul 2004
Date of revision:
Handle: RePEc:acb:cbeeco:2004-443

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Find related papers by JEL classification:
L59 - Industrial Organization - - Regulation and Industrial Policy - - - Other
L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
Z10 - Other Special Topics - - Cultural Economics - - - General

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Esther Gal-Or & Anthony Dukes, 2003. "Minimum Differentiation in Commercial Media Markets," Journal of Economics & Management Strategy, Blackwell Publishing, vol. 12(3), pages 291-325, 09. [Downloadable!] (restricted)
  2. Jean Gabszewicz ; Didier Laussel ; Nathalie Sonnac, . "TV-Broadcasting Competition and Advertising," Working Papers 99-72, Centre de Recherche en Economie et Statistique. [Downloadable!]
    Other versions:
  3. Martin Richardson, 2004. "Cultural quotas in broadcasting I: a model," ANUCBE School of Economics Working Papers 2004-442, Australian National University, College of Business and Economics, School of Economics. [Downloadable!]
  4. Crampes, Claude & Hollander, Abraham, 1995. "Duopoly and quality standards," European Economic Review, Elsevier, vol. 39(1), pages 71-82, January. [Downloadable!] (restricted)
    Other versions:
  5. Francois, Patrick & van Ypersele, Tanguy, 2002. "On the protection of cultural goods," Journal of International Economics, Elsevier, vol. 56(2), pages 359-369, March. [Downloadable!] (restricted)
  6. Osborne, Martin J & Pitchik, Carolyn, 1987. "Equilibrium in Hotelling's Model of Spatial Competition," Econometrica, Econometric Society, vol. 55(4), pages 911-22, July. [Downloadable!] (restricted)
    Other versions:
  7. Keith Acheson & Christopher Maule, 1990. "Canadian Content Rules: A Time for Reconsideration," Canadian Public Policy, University of Toronto Press, vol. 16(3), pages 284-297, September. [Downloadable!] (restricted)
  8. Claude Crampes & Abraham Hollander, 2008. "The regulation of audiovisual content: quotas and conflicting objectives," Journal of Regulatory Economics, Springer, vol. 34(3), pages 195-219, December. [Downloadable!] (restricted)
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Martin Richardson, 2004. "Cultural quotas in broadcasting I: a model," ANUCBE School of Economics Working Papers 2004-442, Australian National University, College of Business and Economics, School of Economics. [Downloadable!]
  2. Claude Crampes & Abraham Hollander, 2008. "The regulation of audiovisual content: quotas and conflicting objectives," Journal of Regulatory Economics, Springer, vol. 34(3), pages 195-219, December. [Downloadable!] (restricted)
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