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Welfare effects of public service broadcasting in a free-to-air TV market

  • Rothbauer, Julia
  • Sieg, Gernot

Viewer's private information consumption generates external benefits for society, because information improves the ability of voters to control politicians. Our study compares two settings in a free-to-air TV market: a differentiated duopoly of private channels and an oligopoly with both private channels and a public service broadcaster broadcasting information as well as entertainment programs. We find that welfare effects of public service broadcasting depend on its program design and cost efficiency, the external benefits of voter's information, and the magnitude of lost rents from the advertising market.

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File URL: https://mpra.ub.uni-muenchen.de/33779/1/MPRA_paper_33779.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 33779.

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Date of creation: 27 Sep 2011
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Handle: RePEc:pra:mprapa:33779
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  1. Gene M. Grossman & Carl Shapiro, 1984. "Informative Advertising with Differentiated Products," Review of Economic Studies, Oxford University Press, vol. 51(1), pages 63-81.
  2. Choi, Jay Pil, 2006. "Broadcast competition and advertising with free entry: Subscription vs. free-to-air," Information Economics and Policy, Elsevier, vol. 18(2), pages 181-196, June.
  3. Stühmeier Torben & Wenzel Tobias, 2012. "Regulating Advertising in the Presence of Public Service Broadcasting," Review of Network Economics, De Gruyter, vol. 11(2), pages 1-23, June.
  4. Hans Jarle Kind & Tore Nilssen & Lars Sørgard, 2007. "Competition for Viewers and Advertisers in a TV Oligopoly," Journal of Media Economics, Taylor & Francis Journals, vol. 20(3), pages 211-233.
  5. Peitz, Martin & Valletti, Tommaso, 2004. "Content and Advertising in the Media: Pay-TV versus Free-To-Air," CEPR Discussion Papers 4771, C.E.P.R. Discussion Papers.
  6. Mark Armstrong, 2005. "Public service broadcasting," Fiscal Studies, Institute for Fiscal Studies, vol. 26(3), pages 281-299, September.
  7. Jean J. Gabszewicz & Didier Laussel & Nathalie Sonnac, 2004. "Programming and Advertising Competition in the Broadcasting Industry," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 13(4), pages 657-669, December.
  8. Julia Rothbauer & Gernot Sieg, 2013. "Public Service Broadcasting of Sport, Shows, and News to Mitigate Rational Ignorance," Journal of Media Economics, Taylor & Francis Journals, vol. 26(1), pages 21-40, March.
  9. Shaun P. Hargreaves Heap, 2005. "Television in a digital age: what role for public service broadcasting?," Economic Policy, CEPR;CES;MSH, vol. 20(41), pages 112-157, 01.
  10. Andrea Prat & David Strömberg, 2006. "Commercial Television and Voter Information," Levine's Bibliography 784828000000000363, UCLA Department of Economics.
  11. Mark Armstrong & Helen Weeds, 2005. "Public Service Broadcasting in the Digital World," Industrial Organization 0507010, EconWPA.
  12. Simon P. Anderson & Stephen Coate, 2005. "Market Provision of Broadcasting: A Welfare Analysis," Review of Economic Studies, Oxford University Press, vol. 72(4), pages 947-972.
  13. Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135.
  14. Prat, Andrea & Strömberg, David, 2011. "The Political Economy of Mass Media," CEPR Discussion Papers 8246, C.E.P.R. Discussion Papers.
  15. Christine Benesch, 2010. "Governance of Public Broadcasters and Television Consumption," CREMA Working Paper Series 2010-18, Center for Research in Economics, Management and the Arts (CREMA).
  16. Sara Connolly & Shaun P. Hargreaves Heap, 2007. "Cross Country Differences in Trust in Television and the Governance of Public Broadcasters," Kyklos, Wiley Blackwell, vol. 60(1), pages 3-14, 02.
  17. Jürgen Hagen, 2006. "Introduction," International Tax and Public Finance, Springer, vol. 13(4), pages 301-302, August.
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