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

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Abstract

Product quality is often unobservable ex-ante and consumers rely on experts’ judgments, sometimes coming under the form of ratings or awards. Do awards affect consumers’ choices or they are conferred to the most popular products? To disentangle this issue, we use data of the most important Italian Literary Prize, the “Strega Prize”, undertaking two different estimation strategies to evaluate the impact on book sales of being awarded the Prize. First, we adopt a Regression Discontinuity Design using as dependent variable a measure of book sales and as forcing variable (proxying for intrinsic book quality) the jury votes received by each nominated book in the competition. We find a very strong impact of the Strega Prize on sales. Second, using weekly data on appearances in bestseller lists, we estimate a difference-in-differences model, comparing sales performance of treated and control books before the award is conferred with their respective performance 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.

Suggested Citation

  • Michela Ponzo & Vincenzo Scoppa, 2013. "Experts’ Awards and Economic Success: Evidence from an Italian Literary Prize," CSEF Working Papers 335, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    • Handle: RePEc:sef:csefwp:335
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    1. Villas-Boas, Sofia B & Rafert, Greg & Hilger, JAmes, 2011. "Expert Opinion and the Demand for Experience Goods: An Experimental Approach," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt0h43433x, Department of Agricultural & Resource Economics, UC Berkeley.
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    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

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    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.

    More about this item

    Keywords

    Cultural Economics; Awards; Literary Prize; Book Sales; Product Quality; Regression Discontinuity Design; Difference-in-Differences model.;

    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

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