IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp8765.html
   My bibliography  Save this paper

Experts' Awards and Economic Success: Evidence from an Italian Literary Prize

Author

Listed:
  • Ponzo, Michela

    (University of Calabria)

  • Scoppa, Vincenzo

    (University of Calabria)

Abstract

Product quality is often unobservable ex-ante and consumers rely on experts' judgments, sometimes in the form of ratings or awards. Do awards affect consumers' choices or, conversely, are they conferred on the most popular products? To disentangle this issue, we use data about the most important Italian Literary Prize, the "Strega Prize", undertaking two different estimation strategies to evaluate the impact that winning the Prize has on book sales. First, we adopt a Regression Discontinuity Design using a measure of book sales as a dependent variable and as a forcing variable (proxying for intrinsic book quality) the jury votes received by each nominated book in the competition. We find that the Strega Prize has a very strong impact on sales. Second, by using weekly data on appearances on bestseller lists, we estimate a difference-in-differences model in which we compare sales performance of treated and control books before the award is conferred with their respective performances afterwards. The results confirm a huge influence of the Prize on book sales and show that most of the impact occurs in the weeks following the announcement of the Prize.

Suggested Citation

  • Ponzo, Michela & Scoppa, Vincenzo, 2015. "Experts' Awards and Economic Success: Evidence from an Italian Literary Prize," IZA Discussion Papers 8765, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp8765
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp8765.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Hilger, James & Rafert, Greg & Villas-Boas, Sofia Berto, 2007. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach," CUDARE Working Papers 6055, University of California, Berkeley, Department of Agricultural and Resource Economics.
    2. David S. Lee & Thomas Lemieux, 2010. "Regression Discontinuity Designs in Economics," Journal of Economic Literature, American Economic Association, vol. 48(2), pages 281-355, June.
    3. David A. Reinstein & Christopher M. Snyder, 2005. "The Influence Of Expert Reviews On Consumer Demand For Experience Goods: A Case Study Of Movie Critics," Journal of Industrial Economics, Wiley Blackwell, vol. 53(1), pages 27-51, March.
    4. Victor A. Ginsburgh & Jan C. van Ours, 2003. "Expert Opinion and Compensation: Evidence from a Musical Competition," American Economic Review, American Economic Association, vol. 93(1), pages 289-296, March.
    5. Caroline Elliott & Rob Simmons, 2008. "Determinants of UK Box Office Success: The Impact of Quality Signals," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 33(2), pages 93-111, September.
    6. Jonah Berger & Alan T. Sorensen & Scott J. Rasmussen, 2010. "Positive Effects of Negative Publicity: When Negative Reviews Increase Sales," Marketing Science, INFORMS, vol. 29(5), pages 815-827, 09-10.
    7. Joshua D. Angrist & Jörn-Steffen Pischke, 2009. "Mostly Harmless Econometrics: An Empiricist's Companion," Economics Books, Princeton University Press, edition 1, number 8769.
    8. Richard Friberg & Erik Grönqvist, 2012. "Do Expert Reviews Affect the Demand for Wine?," American Economic Journal: Applied Economics, American Economic Association, vol. 4(1), pages 193-211, January.
    9. James Hilger & Greg Rafert & Sofia Villas-Boas, 2011. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach in the Retail Wine Market," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1289-1296, November.
    10. Michela Ponzo & Vincenzo Scoppa, 2015. "Experts’ awards and economic success: evidence from an Italian literary prize," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 39(4), pages 341-367, November.
    11. Nelson, Phillip, 1970. "Information and Consumer Behavior," Journal of Political Economy, University of Chicago Press, vol. 78(2), pages 311-329, March-Apr.
    12. Ali, Héla Hadj & Lecocq, Sébastien & Visser, Michael, 2010. "The Impact of Gurus: Parker Grades and en primeur Wine Prices," Journal of Wine Economics, Cambridge University Press, vol. 5(1), pages 22-39, April.
    13. Lee, David S., 2008. "Randomized experiments from non-random selection in U.S. House elections," Journal of Econometrics, Elsevier, vol. 142(2), pages 675-697, February.
    14. Victor Ginsburgh, 2003. "Awards, Success and Aesthetic Quality in the Arts," Journal of Economic Perspectives, American Economic Association, vol. 17(2), pages 99-111, Spring.
    15. Imbens, Guido W. & Lemieux, Thomas, 2008. "Regression discontinuity designs: A guide to practice," Journal of Econometrics, Elsevier, vol. 142(2), pages 615-635, February.
    16. Eva Deuchert & Kossi Adjamah & Florian Pauly, 2005. "For Oscar Glory Or Oscar Money?," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 29(3), pages 159-176, August.
    17. Nelson, Randy A, et al, 2001. "What's an Oscar Worth?," Economic Inquiry, Western Economic Association International, vol. 39(1), pages 1-16, January.
    18. Alan T. Sorensen, 2007. "Bestseller Lists And Product Variety," Journal of Industrial Economics, Wiley Blackwell, vol. 55(4), pages 715-738, December.
    19. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Per la gloria o per il denaro?
      by info@crusoe.it in Robinson Crusoe on 2013-10-18 15:00:00

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michela Ponzo & Vincenzo Scoppa, 2015. "Experts’ awards and economic success: evidence from an Italian literary prize," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 39(4), pages 341-367, November.
    2. Trilce Navarrete & Karol J. Borowiecki, 2015. "Change in access after digitization: Ethnographic collections in Wikipedia," ACEI Working Paper Series AWP-10-2015, Association for Cultural Economics International, revised Oct 2015.
    3. Ponzo, Michela & Scoppa, Vincenzo, 2023. "Famous after death: The effect of a writer's death on book sales," Journal of Economic Behavior & Organization, Elsevier, vol. 210(C), pages 210-225.
    4. Nicolas Lagios & Pierre-Guillaume Méon, 2021. "Experts, Information, Reviews, and Coordination: Evidence on How Literary Prizes Affect Sales," Working Papers CEB 21-011, ULB -- Universite Libre de Bruxelles.
    5. Martina Dattilo & Fabio Padovano & Yvon Rocaboy, 2023. "More is worse: the evolution of quality of the UNESCO World Heritage List and its determinants," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 47(1), pages 71-96, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nicolas Lagios & Pierre-Guillaume Méon, 2021. "Experts, Information, Reviews, and Coordination: Evidence on How Literary Prizes Affect Sales," Working Papers CEB 21-011, ULB -- Universite Libre de Bruxelles.
    2. Jacobsen, Grant D., 2015. "Consumers, experts, and online product evaluations: Evidence from the brewing industry," Journal of Public Economics, Elsevier, vol. 126(C), pages 114-123.
    3. Kamal Bookwala & Caleb Gallemore & Joaquín Gómez‐Miñambres, 2022. "The influence of food recommendations: Evidence from a randomized field experiment," Economic Inquiry, Western Economic Association International, vol. 60(4), pages 1898-1910, October.
    4. Villas-Boas, Sofia B, 2020. "Reduced Form Evidence on Belief Updating Under Asymmetric Information," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt08c456vk, Department of Agricultural & Resource Economics, UC Berkeley.
    5. Engström, Per & Forsell, Eskil, 2018. "Demand effects of consumers’ stated and revealed preferences," Journal of Economic Behavior & Organization, Elsevier, vol. 150(C), pages 43-61.
    6. Dieter Pennerstorfer & Christoph Weiss & Andreas Huber, 2019. "Experts, Reputation and Umbrella Effects: Empirical Evidence from Wine Prices," Economics working papers 2019-08, Department of Economics, Johannes Kepler University Linz, Austria.
    7. John Ashworth & Bruno Heyndels & Kristien Werck, 2010. "Expert judgements and the demand for novels in Flanders," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 34(3), pages 197-218, August.
    8. Clarissa Laura Maria Spiess Bru, 2023. "Does the Tasting Note Matter? Language Categories and Their Impact on Professional Ratings and Prices," Working Papers Dissertations 105, Paderborn University, Faculty of Business Administration and Economics.
    9. Ralf Dewenter & Ulrich Heimeshoff, 2015. "Do expert reviews really drive demand? Evidence from a German car magazine," Applied Economics Letters, Taylor & Francis Journals, vol. 22(14), pages 1150-1153, September.
    10. Martina Dattilo & Fabio Padovano & Yvon Rocaboy, 2023. "More is worse: the evolution of quality of the UNESCO World Heritage List and its determinants," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 47(1), pages 71-96, March.
    11. Robert B. Ekelund & Richard Higgins & John D. Jackson, 2020. "ART as meta-credence: authentication and the role of experts," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 44(1), pages 155-171, March.
    12. Dubois, Pierre & Nauges, Céline, 2010. "Identifying the effect of unobserved quality and expert reviews in the pricing of experience goods: Empirical application on Bordeaux wine," International Journal of Industrial Organization, Elsevier, vol. 28(3), pages 205-212, May.
    13. Ponzo, Michela & Scoppa, Vincenzo, 2023. "Famous after death: The effect of a writer's death on book sales," Journal of Economic Behavior & Organization, Elsevier, vol. 210(C), pages 210-225.
    14. Bonnet, Céline & Hilger, James & Villas-Boas, Sofia B., 2017. "Reduced Form Evidence on Belief Updating under Asymmetric Information - The Case of Wine Expert Opinions," TSE Working Papers 17-834, Toulouse School of Economics (TSE), revised May 2019.
    15. Sofia B. Villas‐Boas & Céline Bonnet & James Hilger, 2021. "Random Utility Models, Wine and Experts," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(2), pages 663-681, March.
    16. Gustafson Christopher R., 2015. "The Role of Knowledge in Choice, Valuation, and Outcomes for Multi-Attribute Goods," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 13(1), pages 33-43, January.
    17. Kim, Hayoung, 2022. "Heterogeneous effects of information disclosure: Evidence from housing markets," Journal of Economic Behavior & Organization, Elsevier, vol. 195(C), pages 359-380.
    18. Wenying Li & Eric Andrew Finkelstein & Chen Zhen, 2022. "Intended and unintended consequences of salient nutrition labels," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(2), pages 853-872, March.
    19. Amanda J. Sharkey & Balázs Kovács, 2018. "The Many Gifts of Status: How Attending to Audience Reactions Drives the Use of Status," Management Science, INFORMS, vol. 64(11), pages 5422-5443, November.
    20. Gustafson, Christopher R. & Lybbert, Travis J. & Sumner, Daniel A., 2016. "Consumer knowledge affects valuation of product attributes: Experimental results for wine," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 65(C), pages 85-94.

    More about this item

    Keywords

    product quality; book sales; literary prize; asymmetric information; awards; cultural economics; regression discontinuity design; difference-in-differences model;
    All these keywords.

    JEL classification:

    • Z10 - Other Special Topics - - Cultural Economics - - - General
    • Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • M30 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - General
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • J44 - Labor and Demographic Economics - - Particular Labor Markets - - - Professional Labor Markets and Occupations

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp8765. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.