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Effects of Deregulation and Consolidation of the Broadcast Television Industry

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  • Jessica Calfee Stahl

Abstract

This paper exploits deregulation in the 1990s to estimate viewership and revenue effects of consolidation in broadcast television, then finds cost effects that explain the ownership structure given viewership and revenue effects. Results suggest that consolidation greatly increased profitability in an industry with otherwise declining profitability. Groups with broader national coverage attract more advertising per station. Joint ownership of two stations within a market and network ownership both allow for significant cost savings. There is some evidence that within-market consolidation allows stations to achieve local market power. However, both within-market and across-market consolidation appear to have boosted viewership, on net.

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  • Jessica Calfee Stahl, 2016. "Effects of Deregulation and Consolidation of the Broadcast Television Industry," American Economic Review, American Economic Association, vol. 106(8), pages 2185-2218, August.
    • Handle: RePEc:aea:aecrev:v:106:y:2016:i:8:p:2185-2218
    Note: DOI: 10.1257/aer.20110948
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    References listed on IDEAS

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    Cited by:

    1. Babette Boliek & Kim Makuch & Catherine Matraves & Aleks Yankelevich, 2019. "Economics at the FCC 2018–2019: Competition, Broadband Deployment, and Transaction Review," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 55(4), pages 625-646, December.
    2. Robert Clark & Mario Samano, 2022. "Incentivized Mergers and Cost Efficiency: Evidence from the Electricity Distribution Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 70(4), pages 791-837, December.
    3. Suguru Otani, 2021. "Estimating Endogenous Coalitional Mergers: Merger Costs and Assortativeness of Size and Specialization," Papers 2108.12744, arXiv.org, revised Mar 2023.
    4. Feng, Yun & Liu, Chelsea & Yawson, Alfred, 2023. "Economic shocks, M&A advisors, and industry takeover activity," Pacific-Basin Finance Journal, Elsevier, vol. 82(C).

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    More about this item

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • L88 - Industrial Organization - - Industry Studies: Services - - - Government Policy

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