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Convergence and the Potential Ban on Interactive Product Placement in Germany

  • Christian Jansen

    (Humboldt-University of Berlin)

This paper addresses the economic impact of German advertising regulations. The digital convergence of media provides a starting point for the analysis. This convergence makes technically feasible “interactive product placement” (IPP), the integration of interactively purchasable products in television programs and movies for the purpose of advertising. Such advertising could conceivably outstrip traditional product placement as a source of revenues for the film industry. Moreover, IPP could provide valuable incentives to create new audiovisual hardware and software. As product placement is generally banned in Germany, we critically review relevant regulations. Additionally, a simple model is developed that allows for a welfare economic approach to the analysis of an IPP ban.

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File URL: http://econwpa.repec.org/eps/le/papers/0302/0302002.pdf
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Paper provided by EconWPA in its series Law and Economics with number 0302002.

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Length: 36 pages
Date of creation: 19 Feb 2003
Date of revision:
Handle: RePEc:wpa:wuwple:0302002
Note: Type of Document - pdf; prepared on PC; pages: 36
Contact details of provider: Web page: http://econwpa.repec.org

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  1. Wright, Donald J., 1992. "Television Advertising Regulation And Programme Quality," Working Papers 178, University of Sydney, School of Economics.
  2. Motta, Massimo, 1997. "Advertising Bans," CEPR Discussion Papers 1613, C.E.P.R. Discussion Papers.
  3. Schneider, Lynne & Klein, Benjamin & Murphy, Kevin M, 1981. "Governmental Regulation of Cigarette Health Information," Journal of Law and Economics, University of Chicago Press, vol. 24(3), pages 575-612, December.
  4. Brown, Allan & Cave, Martin, 1992. "The Economics of Television Regulation: A Survey with Application to Australia," The Economic Record, The Economic Society of Australia, vol. 68(203), pages 377-94, December.
  5. Milgrom, Paul & Roberts, John, 1986. "Price and Advertising Signals of Product Quality," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 796-821, August.
  6. GABSZEWICZ, Jean J. & LAUSSEL, Didier & SONNAC, Nathalie, 2000. "TV-broadcasting competition and advertising," CORE Discussion Papers 2000006, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  7. De Vany, A. & Walls, W.D., 1999. ""Uncertainty in the Movies: Does Star Power Reduce the Terror of the Box Office?"," Papers 98-99-10, California Irvine - School of Social Sciences.
  8. Stegeman, Mark, 1991. "Advertising in Competitive Markets," American Economic Review, American Economic Association, vol. 81(1), pages 210-23, March.
  9. Nilssen, T. & Sorgard, L., 2000. "TV Advertising, Programming Investments, and Product-Market Oligopoly," Papers 6/2000, Norwegian School of Economics and Business Administration-.
  10. Nichols, Len M, 1985. "Advertising and Economic Welfare," American Economic Review, American Economic Association, vol. 75(1), pages 213-18, March.
  11. Grossman, Gene M & Shapiro, Carl, 1984. "Informative Advertising with Differentiated Products," Review of Economic Studies, Wiley Blackwell, vol. 51(1), pages 63-81, January.
  12. Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 488-500, August.
  13. Simon P. Anderson & Stephen Coate, 2000. "Market Provision of Public Goods: The Case of Broadcasting," NBER Working Papers 7513, National Bureau of Economic Research, Inc.
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