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How do your rivals’ releasing dates affect your box office?

Author

Listed:
  • Fernanda Gutierrez-Navratil

    ()

  • Victor Fernandez-Blanco

    ()

  • Luis Orea

    ()

  • Juan Prieto-Rodriguez

    ()

Abstract

In this paper, we study to what extent a movie’s box-office receipts are affected by the temporal distribution of rival films. We propose a reduced-form empirical model to measure and test competition effects among films released close to each other in a standard regression framework. Such an analysis is appealing in terms of its policy implication and may provide guidance to distributors to decide on their releasing dates of their firms. We estimate this model using information on the films released in five countries: the USA, the United Kingdom, Germany, France and Spain. The geographical dimension of our data set permits us to control for unobserved heterogeneity among films released using panel data techniques, which allows us to evaluate the individual and specific effects of each film. Thus we deal with one of the most relevant features of the movie market, namely the presence of highly differentiated products. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • 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.
  • Handle: RePEc:kap:jculte:v:38:y:2014:i:1:p:71-84 DOI: 10.1007/s10824-012-9188-0
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    References listed on IDEAS

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    1. Anita Elberse & Jehoshua Eliashberg, 2003. "Demand and Supply Dynamics for Sequentially Released Products in International Markets: The Case of Motion Pictures," Marketing Science, INFORMS, vol. 22(3), pages 329-354.
    2. Peter Davis, 2006. "Spatial competition in retail markets: movie theaters," RAND Journal of Economics, RAND Corporation, vol. 37(4), pages 964-982, December.
    3. Jordi McKenzie, 2012. "The Economics Of Movies: A Literature Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 26(1), pages 42-70, February.
    4. Andrew Ainslie & Xavier Drèze & Fred Zufryden, 2005. "Modeling Movie Life Cycles and Market Share," Marketing Science, INFORMS, vol. 24(3), pages 508-517, November.
    5. Ravid, S Abraham, 1999. "Information, Blockbusters, and Stars: A Study of the Film Industry," The Journal of Business, University of Chicago Press, vol. 72(4), pages 463-492, October.
    6. Orbach, Barak Y. & Einav, Liran, 2007. "Uniform prices for differentiated goods: The case of the movie-theater industry," International Review of Law and Economics, Elsevier, vol. 27(2), pages 129-153.
    7. Robert E. Krider & Tieshan Li & Yong Liu & Charles B. Weinberg, 2005. "The Lead-Lag Puzzle of Demand and Distribution: A Graphical Method Applied to Movies," Marketing Science, INFORMS, vol. 24(4), pages 635-645, April.
    8. 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, pages 207-225.
    9. Ramya Neelamegham & Pradeep Chintagunta, 1999. "A Bayesian Model to Forecast New Product Performance in Domestic and International Markets," Marketing Science, INFORMS, pages 115-136.
    10. 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, pages 71-84.
    11. Victor Ginsburgh & Sheila Weyers, 1999. "On the Perceived Quality of Movies," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, pages 269-283.
    12. Charles C. Moul, 2007. "Measuring Word of Mouth's Impact on Theatrical Movie Admissions," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 16(4), pages 859-892, December.
    13. repec:rje:randje:v:37:y:2006:i:4:p:964-982 is not listed on IDEAS
    14. 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.
    15. Jordi McKenzie, 2010. "How do theatrical box office revenues affect DVD retail sales? Australian empirical evidence," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, pages 159-179.
    16. 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, pages 207-225.
    17. David Lang & David Switzer & Brandon Swartz, 2011. "DVD sales and the R-rating puzzle," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, pages 267-286.
    18. 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, pages 179-206.
    19. Liran Einav, 2007. "Seasonality in the U.S. motion picture industry," RAND Journal of Economics, RAND Corporation, vol. 38(1), pages 127-145, March.
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    Citations

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    Cited by:

    1. 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, pages 71-84.
    2. Ronnie J. Phillips & Ian C. Strachan, 2016. "Breaking up is hard to do: the resilience of the rock group as an organizational form for creating music," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, pages 29-74.
    3. 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.
    4. Juan Prieto-Rodriguez & Fernanda Gutierrez-Navratil & Victoria Ateca-Amestoy, 2015. "Theatre allocation as a distributor’s strategic variable over movie runs," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, pages 65-83.
    5. repec:hpe:journl:y:2017:v:221:i:2:p:9-31 is not listed on IDEAS
    6. Denis Y. Orlov & Evgeniy M. Ozhegov, 2016. "Do sequel movies really earn more than non-sequels? Evidence from the US box office," ACEI Working Paper Series AWP-03-2016, Association for Cultural Economics International, revised Apr 2016.
    7. Frederick Derrick & Nancy Williams & Charles Scott, 2014. "A two-stage proxy variable approach to estimating movie box office receipts," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, pages 173-189.

    More about this item

    Keywords

    Temporal competition; Movie exhibition; Film industry; Panel data; Unobserved heterogeneity; Differentiated products; Z10;

    JEL classification:

    • Z10 - Other Special Topics - - Cultural Economics - - - General

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