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Why do Movie Studios Produce R-rated Films?

Author

Listed:
  • Brian Goff
  • Dennis Wilson
  • David Zimmer

Abstract

R-rated films are correlated with lower box office revenues. Using sex and nudity content as an instrument to predict R-ratings, we show that R-ratings themselves are not the cause of lower revenues. Instead, R-rated films contain traits that lower revenues and the ratings act as a signal of those traits. Why do film producers include those traits and seek R-ratings? We show that R-ratings alter the shape of the distribution of critical reviews, shifting the distribution to the right. Moreover, even after controlling for other influences, R-ratings improve critical reviews, suggesting that producers not only seek box office revenues, but also critical acclaim.

Suggested Citation

  • Brian Goff & Dennis Wilson & David Zimmer, 2015. "Why do Movie Studios Produce R-rated Films?," Applied Economics and Finance, Redfame publishing, vol. 2(1), pages 33-43, February.
    • Handle: RePEc:rfa:aefjnl:v:2:y:2015:i:1:p:33-43
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    More about this item

    Keywords

    monopolistic quality choice; causal impact; quantile treatment effects;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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