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BESTSELLER LISTS AND PRODUCT VARIETY -super-

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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. Copyright 2007 Blackwell Publishing Ltd..

Suggested Citation

  • Alan T. Sorensen, 2007. "BESTSELLER LISTS AND PRODUCT VARIETY -super-," 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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    References listed on IDEAS

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    1. 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.
    2. 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.
    3. 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.
    4. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-858, December.
    5. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    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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    Citations

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    Cited by:

    1. 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.
    2. 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.
    3. 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.
    4. Mark Armstrong, 2017. "Ordered Consumer Search," Journal of the European Economic Association, European Economic Association, vol. 15(5), pages 989-1024.
    5. repec:zbw:espost:180821 is not listed on IDEAS
    6. 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.
    7. repec:eee:jbrese:v:85:y:2018:i:c:p:105-116 is not listed on IDEAS
    8. Luca Aguzzoni & Elena Argentesi & Lorenzo Ciari & Tomaso Duso & Massimo Tognoni, 2016. "Ex post Merger Evaluation in the U.K. Retail Market for Books," Journal of Industrial Economics, Wiley Blackwell, vol. 64(1), pages 170-200, March.
    9. repec:eee:jouret:v:92:y:2016:i:3:p:319-332 is not listed on IDEAS
    10. 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.
    11. Beck, Jonathan, 2008. "Diderot´s rule," Discussion Papers, Research Unit: Competition and Innovation SP II 2008-13, WZB Berlin Social Science Center.
    12. 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.
    13. 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.
    14. 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.
    15. repec:eee:joreco:v:21:y:2014:i:1:p:37-42 is not listed on IDEAS
    16. 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.
    17. 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.

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