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Faddists, Enthusiasts and Canadian Divas: Broadcasting Quotas and the Supply Response

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  • Martin Richardson
  • Simon Wilkie

Abstract

This paper constructs a model of the recorded music market to investigate the consequences of local content requirements in broadcasting for the “internationalization” of domestic music. It models the entry decisions of bands, the contracting decisions of record companies, the airplay decisions of radio stations and the radio listening and recording purchasing decisions of consumers. The paper shows that a local content quota leads, perversely, to the increased internationalization of domestic music. A quota that also requires increased broadcasting of “new” music yields an additional welfare loss but does nothing to a record company's incentives to sign up new bands.

Suggested Citation

  • Martin Richardson & Simon Wilkie, 2015. "Faddists, Enthusiasts and Canadian Divas: Broadcasting Quotas and the Supply Response," Review of International Economics, Wiley Blackwell, vol. 23(2), pages 404-424, May.
    • Handle: RePEc:bla:reviec:v:23:y:2015:i:2:p:404-424
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    File URL: http://hdl.handle.net/10.1111/roie.12171
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    References listed on IDEAS

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    1. Martin Richardson & Simon Wilkie, 2013. "Faddists, enthusiasts and Canadian divas:a model of the recorded music market," ANU Working Papers in Economics and Econometrics 2013-600, Australian National University, College of Business and Economics, School of Economics.
    2. Martin Richardson, 2017. "Commercial Broadcasting and Local Content: Cultural Quotas, Advertising and Public Stations," World Scientific Book Chapters, in: Dimensions of Trade Policy, chapter 3, pages 41-71, World Scientific Publishing Co. Pte. Ltd..
    3. Doyle, Chris, 1998. "Programming in a competitive broadcasting market: entry, welfare and regulation," Information Economics and Policy, Elsevier, vol. 10(1), pages 23-39, March.
    4. 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.
    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.
    6. Perona, Mathieu, 2010. "How Broadcasting Quotas Harm Program Diversity," MPRA Paper 19860, University Library of Munich, Germany.
    7. Berry, Steven T. & Waldfogel, Joel, 1999. "Public radio in the United States: does it correct market failure or cannibalize commercial stations?," Journal of Public Economics, Elsevier, vol. 71(2), pages 189-211, February.
    8. Robert P. Rogers & John R. Woodbury, 1996. "Market Structure, Program Diversity, And Radio Audience Size," Contemporary Economic Policy, Western Economic Association International, vol. 14(1), pages 81-91, January.
    9. Tyler Cowen, 2008. "Why everything has changed: the recent revolution in cultural economics," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 32(4), pages 261-273, December.
    10. Bala, Venkatesh & Van Long, Ngo, 2005. "International trade and cultural diversity with preference selection," European Journal of Political Economy, Elsevier, vol. 21(1), pages 143-162, March.
    11. Ben Shiller & Joel Waldfogel, 2011. "Music for a Song: An Empirical Look at Uniform Pricing and Its Alternatives," Journal of Industrial Economics, Wiley Blackwell, vol. 59(4), pages 630-660, December.
    12. Andreu Mas-Colell, 1999. "Should Cultural Goods Be Treated Differently?," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 23(1), pages 87-93, March.
    13. Mangani, Andrea, 2003. "Profit and audience maximization in broadcasting markets," Information Economics and Policy, Elsevier, vol. 15(3), pages 305-315, September.
    14. Anderson, Simon P & De Palma, Andre, 1992. "The Logit as a Model of Product Differentiation," Oxford Economic Papers, Oxford University Press, vol. 44(1), pages 51-67, January.
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    Cited by:

    1. Jeon, Doh-Shin & Jullien, Bruno & Klimenko, Mikhail, 2021. "Language, internet and platform competition," Journal of International Economics, Elsevier, vol. 131(C).

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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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