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Spatial competition and market share: an application to motion pictures

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  • Darlene Chisholm
  • George Norman

Abstract

This paper presents an empirical assessment of movie-theatre attendance in two major metropolitan markets and provides strong support for the importance of spatial characteristics in determining attendance. We consider the hypothesis that attendance at a particular movie theatre reflects a tension between two effects: a negative competition effect and a positive agglomeration effect. We find evidence that the competition effect dominates. Further, we identify a pattern of systematic spatial decay in the impact of this effect on demand. Copyright Springer Science+Business Media New York 2012

Suggested Citation

  • Darlene Chisholm & George Norman, 2012. "Spatial competition and market share: an application to motion pictures," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 36(3), pages 207-225, August.
    • Handle: RePEc:kap:jculte:v:36:y:2012:i:3:p:207-225
    DOI: 10.1007/s10824-012-9168-4
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    Cited by:

    1. Yu-Hsi Liu & Darlene C. Chisholm & George Norman, 2023. "Product-Line Decisions and Rapid Turnover in Movie Markets," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 62(4), pages 341-365, June.
    2. Shaoling Chen & Susheng Wang & Haisheng Yang, 2015. "Spatial Competition and Interdependence in Strategic Decisions: Empirical Evidence from Franchising," Economic Geography, Clark University, vol. 91(2), pages 165-204, April.
    3. Gihwan Yi & Min Kim & Hoe Sang Chung, 2024. "The Revenue Impact of Differential Seat Pricing and Competition in the Movie Theater Market," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 64(3), pages 361-382, May.
    4. Fernanda Gutierrez-Navratil & Victor Fernandez-Blanco & Luis Orea & Juan Prieto-Rodriguez, 2014. "How do your rivals’ releasing dates affect your box office?," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 38(1), pages 71-84, February.
    5. 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.
    6. Dapeng Liu & Pascal Courty, 2022. "Some economics of movie exhibition: increasing returns and Imax revenue premium," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 46(4), pages 597-634, December.
    7. Kim, In Kyung & Lee, Yoon-Jin & Yoon, Young-Ro, 2020. "Floating Population and Demand for Movie Theaters in Metropolitan Cities," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 61(2), pages 140-169, December.
    8. P. Belleflamme & D. Paolini, 2015. "Strategic Promotion and Release Decisions for Cultural Goods," Working Paper CRENoS 201508, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    9. Mitsuru Sunada, 2012. "Competition among movie theaters: an empirical investigation of the Toho–Subaru antitrust case," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 36(3), pages 179-206, August.
    10. Paul Belleflamme & Dimitri Paolini, 2019. "Strategic attractiveness and release decisions for cultural goods," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 28(2), pages 198-224, April.
    11. Jing Chen & Xing Wan & Jing Yang, 2023. "Superstar effects in a platform-based local market: The role of customer usage of online-to-offline platforms and spatial agglomeration," Electronic Markets, Springer;IIM University of St. Gallen, vol. 33(1), pages 1-16, December.

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    More about this item

    Keywords

    Spatial competition; Competition effect; Location choice; Motion-pictures industry studies; L11; D43; L82;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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