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Coordination, Differentiation, and the Timing of Radio Commercials

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  • Andrew Sweeting

Abstract

This paper examines the timing of commercial breaks by contemporary music radio stations. A simple model shows that stations may prefer, all else equal, to choose the same times (coordination) or different times (differentiation) for breaks depending on how listeners behave. It also shows that how much commercials overlap in Nash equilibrium should vary in different ways with observable market characteristics, such as the number of stations, depending on whether stations prefer to coordinate or differentiate. Panel data on the timing of commercials by 1,094 stations provide consistent support for the hypothesis that stations prefer to coordinate on timing.

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  • Andrew Sweeting, 2006. "Coordination, Differentiation, and the Timing of Radio Commercials," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 15(4), pages 909-942, December.
    • Handle: RePEc:bla:jemstr:v:15:y:2006:i:4:p:909-942
    DOI: 10.1111/j.1530-9134.2006.00122.x
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    References listed on IDEAS

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    Cited by:

    1. Petrova, Maria, 2011. "Newspapers and Parties: How Advertising Revenues Created an Independent Press," American Political Science Review, Cambridge University Press, vol. 105(4), pages 790-808, November.
    2. Zafar, Basit, 2011. "An experimental investigation of why individuals conform," European Economic Review, Elsevier, vol. 55(6), pages 774-798, August.
    3. Shurchkov, Olga, 2016. "Public announcements and coordination in dynamic global games: Experimental evidence," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 61(C), pages 20-30.
    4. An-Hsiang Liu & Ralph Siebert & Christine Zulehner, 2013. "The Impact of Entry Regulation on Total Welfare: A Policy Experiment," CESifo Working Paper Series 4291, CESifo.
    5. Andrew Sweeting, 2009. "The strategic timing incentives of commercial radio stations: An empirical analysis using multiple equilibria," RAND Journal of Economics, RAND Corporation, vol. 40(4), pages 710-742, December.
    6. An-Hsiang Liu & Ralph Siebert, 2020. "The Competitive Effects of Declining Entry Costs over Time: Evidence from the Static Random Access Memory Market," CESifo Working Paper Series 8552, CESifo.
    7. Gautam, Sanghmitra, 2023. "Quantifying welfare effects in the presence of externalities: An ex-ante evaluation of sanitation interventions," Journal of Development Economics, Elsevier, vol. 164(C).
    8. Andrew Sweeting, 2005. "Coordination Games, Multiple Equilibria and the Timing of Radio Commercials," 2005 Meeting Papers 490, Society for Economic Dynamics.

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