Concentration in the Press Industry and the Theory of the “Circulation Spiral
In this paper we model a situation competition between two editorswho are rivals in both the newspapers’ and advertising industries. To identifythe consequences of this competition, we analyse a two-period sequentialgame whose players are the editors each selling a differentiated newspaper,like newspapers of different political content. We characterise the equilibriaand explore how theydep end on the number of ad-avoiders and ad-lovers,and on the intensityof reader’s attraction or repulsion feelings for advertising.Our main finding is that equilibria are often observed in the sequential game,at which one of the editors prevents the entryof his rival and fullymonop oliesboth the press and advertising markets.
|Date of creation:||2003|
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