Demand stochastics, supply adaptation, and the distribution of film earnings
A market is analysed in which demand is a stochastic process and supply is contingent on the expected level of demand - a model that provides a realistic depiction of the motion picture market where consumer demand is a process of discovery and information sharing, and the supply of theatre screens expands through contingent contracts to accommodate demand. This model predicts that motion picture earnings will deviate from a power law and instead be distributed according to an exponential of a power law due to finite-size effects in demand. Empirical analysis on a large sample of motion pictures finds significant deviation from the power law distribution and a remarkably good fit for the stretched exponential distribution.
Volume (Year): 12 (2005)
Issue (Month): 10 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAEL20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAEL20|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- De Vany, Arthur & Walls, W David, 1996. "Bose-Einstein Dynamics and Adaptive Contracting in the Motion Picture Industry," Economic Journal, Royal Economic Society, vol. 106(439), pages 1493-1514, November.
- De Vany, A. & Walls, W.D., 2000.
"Does Hollywood make too many R-Rated Movies? Risk, Stochastic Dominance, and the Illusion of Expectation,"
99-00-24, California Irvine - School of Social Sciences.
- Arthur De Vany & W. David Walls, 2002. "Does Hollywood Make Too Many R-Rated Movies? Risk, Stochastic Dominance, and the Illusion of Expectation," The Journal of Business, University of Chicago Press, vol. 75(3), pages 425-452, July.
- Ijiri, Yuji & Simon, Herbert A, 1971. "Effects of Mergers and Acquisitions on Business Firm Concentration," Journal of Political Economy, University of Chicago Press, vol. 79(2), pages 314-322, March-Apr.
When requesting a correction, please mention this item's handle: RePEc:taf:apeclt:v:12:y:2005:i:10:p:619-623. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.