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Do media consumers really dislike advertising? An empirical assessment of the role of advertising in print media markets

  • Kaiser, Ulrich
  • Song, Minjae

This paper uses data on German consumer magazines observed between 1992 and 2004 to analyze the extent to which consumers (dis-)like advertising. We estimate logit demand models separately for the six most important magazine segments in terms of circulation. We find little evidence for readers disliking advertising. On the contrary, we show that readers in many magazine segments appreciate advertising. Readers of Women's magazines, Business and politics magazines as well as Car magazines -- market segments where advertisements are relatively more informative -- appreciate advertising while advertising is nuisance to readers of Adult magazines, a segment where advertisements are particularly uninformative. Demand for interior design magazines is not well identified. Our logit demand estimates are confirmed by logit demand models with random coefficients and by magazine-specific monopoly demand models.

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Article provided by Elsevier in its journal International Journal of Industrial Organization.

Volume (Year): 27 (2009)
Issue (Month): 2 (March)
Pages: 292-301

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Handle: RePEc:eee:indorg:v:27:y:2009:i:2:p:292-301
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505551

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  1. Amil Petrin, 2002. "Quantifying the Benefits of New Products: The Case of the Minivan," Journal of Political Economy, University of Chicago Press, vol. 110(4), pages 705-729, August.
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  12. Kind, Hans Jarle & Nilssen, Tore & Sørgard, Lars, 2005. "Advertising on TV: Under- or Overprovision?," Memorandum 15/2005, Oslo University, Department of Economics.
  13. Jerry HAUSMAN & Gregory LEONARD & J. Douglas ZONA, 1994. "Competitive Analysis with Differentiated Products," Annales d'Economie et de Statistique, ENSAE, issue 34, pages 159-180.
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