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Bestseller Lists And Product Variety

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  • ALAN T. SORENSEN

Abstract

This paper uses detailed weekly data on sales of hardcover fiction books to evaluate the impact of the New York Times bestseller list on sales and product variety. In order to circumvent the obvious problem of simultaneity of sales and bestseller status, the analysis exploits time lags and accidental omissions in the construction of the list. The empirical results indicate that appearing on the list leads to a modest increase in sales for the average book, and that the effect is more dramatic for bestsellers by debut authors. The paper discusses how the additional concentration of demand on top‐selling books could lead to a reduction in the privately optimal number of books to publish. However, the data suggest the opposite is true: the market expansion effect of bestseller lists appears to dominate any business stealing from non‐bestselling titles.

Suggested Citation

  • Alan T. Sorensen, 2007. "Bestseller Lists And Product Variety," Journal of Industrial Economics, Wiley Blackwell, vol. 55(4), pages 715-738, December.
  • Handle: RePEc:bla:jindec:v:55:y:2007:i:4:p:715-738
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    File URL: https://doi.org/10.1111/j.1467-6451.2007.00327.x
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    References listed on IDEAS

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    1. Milgrom, Paul & Roberts, John, 1986. "Price and Advertising Signals of Product Quality," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 796-821, August.
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    3. Alexander, Peter J., 1997. "Product variety and market structure: A new measure and a simple test," Journal of Economic Behavior & Organization, Elsevier, vol. 32(2), pages 207-214, February.
    4. Steven T. Berry & Joel Waldfogel, 2001. "Do Mergers Increase Product Variety? Evidence from Radio Broadcasting," The Quarterly Journal of Economics, Oxford University Press, vol. 116(3), pages 1009-1025.
    5. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-858, December.
    6. Abhijit V. Banerjee, 1992. "A Simple Model of Herd Behavior," The Quarterly Journal of Economics, Oxford University Press, vol. 107(3), pages 797-817.
    7. Lancaster, Kelvin, 1975. "Socially Optimal Product Differentiation," American Economic Review, American Economic Association, vol. 65(4), pages 567-585, September.
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    Cited by:

    1. Trilce Navarrete & Karol J. Borowiecki, 2015. "Change in access after digitization: Ethnographic collections in Wikipedia," ACEI Working Paper Series AWP-10-2015, Association for Cultural Economics International, revised Oct 2015.
    2. Mark Armstrong, 2017. "Ordered Consumer Search," Journal of the European Economic Association, European Economic Association, vol. 15(5), pages 989-1024.
    3. repec:eee:jbrese:v:92:y:2018:i:c:p:339-349 is not listed on IDEAS
    4. Beck, Jonathan, 2008. "Diderot´s rule," Discussion Papers, Research Unit: Competition and Innovation SP II 2008-13, WZB Berlin Social Science Center.
    5. Pope, Devin G., 2009. "Reacting to rankings: Evidence from "America's Best Hospitals"," Journal of Health Economics, Elsevier, vol. 28(6), pages 1154-1165, December.
    6. Aguzzoni, Luca & Argentesi, Elena & Ciari, Lorenzo & Duso, Tomaso & Tognoni, Massimo, 2016. "Ex-post Merger Evaluation in the U.K. Retail Market for Books," EconStor Open Access Articles, ZBW - Leibniz Information Centre for Economics, pages 170-200.
    7. repec:eee:jeborg:v:161:y:2019:i:c:p:216-242 is not listed on IDEAS
    8. Helmers, Christian & Krishnan, Pramila & Patnam, Manasa, 2015. "Attention and Saliency on the Internet: Evidence from an Online Recommendation System," CEPR Discussion Papers 10939, C.E.P.R. Discussion Papers.
    9. Gabriel Natividad, 2013. "Financial Slack, Strategy, and Competition in Movie Distribution," Organization Science, INFORMS, vol. 24(3), pages 846-864, June.
    10. repec:eee:jouret:v:92:y:2016:i:3:p:319-332 is not listed on IDEAS
    11. Nataliya Kochkina & Evgeniya Popova, 2017. "Are Books Luxury Goods in Russia or not?," ACEI Working Paper Series AWP-06-2017, Association for Cultural Economics International, revised Jul 2017.
    12. Dieter Pennerstorfer & Christoph Weiss & Andreas Huber, 2019. "Experts, Reputation and Umbrella Effects: Empirical Evidence from Wine Prices," Economics working papers 2019-08, Department of Economics, Johannes Kepler University Linz, Austria.
    13. Ken Hendricks & Alan Sorensen, 2009. "Information and the Skewness of Music Sales," Journal of Political Economy, University of Chicago Press, vol. 117(2), pages 324-369, April.
    14. Ohio University & Department of Economics & Hailey Hayeon Joo, 2009. "Social Learning and Optimal Advertising in the Motion Picture Industry," 2009 Meeting Papers 513, Society for Economic Dynamics.
    15. Luís Cabral & Gabriel Natividad, 2016. "Box-Office Demand: The Importance of Being #1," Journal of Industrial Economics, Wiley Blackwell, vol. 64(2), pages 277-294, June.
    16. Laurent Bouton, 2011. "Good rankings are bad - Why reliable rankings can hurt consumers," Boston University - Department of Economics - Working Papers Series WP2011-002, Boston University - Department of Economics.
    17. Craig L. Garthwaite, 2012. "You Get a Book! Demand Spillovers, Combative Advertising, and Celebrity Endorsements," NBER Working Papers 17915, National Bureau of Economic Research, Inc.
    18. Xinxin Li & Bin Gu & Hongju Liu, 2013. "Price Dispersion and Loss-Leader Pricing: Evidence from the Online Book Industry," Management Science, INFORMS, vol. 59(6), pages 1290-1308, June.
    19. repec:eee:joreco:v:21:y:2014:i:1:p:37-42 is not listed on IDEAS
    20. repec:eee:jbrese:v:85:y:2018:i:c:p:105-116 is not listed on IDEAS
    21. Blomkvist, Katarina & Kappen, Philip & Zander, Ivo, 2014. "Superstar inventors—Towards a people-centric perspective on the geography of technological renewal in the multinational corporation," Research Policy, Elsevier, vol. 43(4), pages 669-682.
    22. Cédric Ceulemans & Victor Ginsburgh & Juan Prieto-Rodríguez & Sheila Weyers, 2018. "One Hundred Years of Solitude Bestsellers in the United States, 1900-1999," Working Papers ECARES 2018-26, ULB -- Universite Libre de Bruxelles.

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