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Screening decisions of vertically integrated theaters in the Korean movie industry

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Listed:
  • Chung, Hoe Sang
  • Kim, Min
  • Yi, Gihwan

Abstract

This paper investigates the effects of vertical integration on screening decisions using data from the Korean movie industry. We find that integrated theaters show their affiliated movies more than nonaffiliated movies, and more than nonintegrated theaters do. However, this gap reduces during the peak times of the day and after the opening week. Our evidence suggests that the integrated theaters’ screening decisions favorable to their own movies are better understood as the result of dealing with the incentive misalignment than as the result of foreclosing other movies.

Suggested Citation

  • Chung, Hoe Sang & Kim, Min & Yi, Gihwan, 2018. "Screening decisions of vertically integrated theaters in the Korean movie industry," Economics Letters, Elsevier, vol. 170(C), pages 6-9.
    • Handle: RePEc:eee:ecolet:v:170:y:2018:i:c:p:6-9
    DOI: 10.1016/j.econlet.2018.05.026
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    References listed on IDEAS

    as
    1. W. Wayne Fu, 2009. "Screen Survival of Movies at Competitive Theaters: Vertical and Horizontal Integration in a Spatially Differentiated Market," Journal of Media Economics, Taylor & Francis Journals, vol. 22(2), pages 59-80.
    2. Mitsuru Sunada, 2010. "Vertical Integration in the Japanese Movie Industry," Journal of Industry, Competition and Trade, Springer, vol. 10(2), pages 135-150, June.
    3. Kenneth S. Corts, 2001. "The Strategic Effects of Vertical Market Structure: Common Agency and Divisionalization in the US Motion Picture Industry," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 10(4), pages 509-528, December.
    4. Ricard Gil, 2015. "Does Vertical Integration Decrease Prices? Evidence from the Paramount Antitrust Case of 1948," American Economic Journal: Economic Policy, American Economic Association, vol. 7(2), pages 162-191, May.
    5. F. Andrew Hanssen, 2010. "Vertical Integration during the Hollywood Studio Era," Journal of Law and Economics, University of Chicago Press, vol. 53(3), pages 519-543.
    6. Ricard Gil, 2009. "Revenue Sharing Distortions and Vertical Integration in the Movie Industry," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 25(2), pages 579-610, October.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Jordi McKenzie, 2023. "The economics of movies (revisited): A survey of recent literature," Journal of Economic Surveys, Wiley Blackwell, vol. 37(2), pages 480-525, April.
    2. Seulgi Yoo & Seonghoon Jeon, 2022. "The Effects of Vertical Integration in the Korea Movie Industry: Efficiency Versus Exclusion," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 61(3), pages 279-296, November.

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    More about this item

    Keywords

    Number of movie showings; Vertical integration; Market foreclosure; Incentive misalignment; Korean movie industry;
    All these keywords.

    JEL classification:

    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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