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The impact of social distancing on box-office revenue: Evidence from the COVID-19 pandemic

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  • In Kyung Kim

    (Nazarbayev University)

Abstract

In this paper, I study the short-run effect of social distancing due to the COVID-19 outbreak on movie demand and box-office revenue. Using longitudinal data on the Korean movie theater industry, I first estimate a nested logit model of movie demand, and then quantify the revenue loss in the industry. Estimation results reveal that the revenue loss due to the decrease in underlying movie demand is approximately 52 million dollars nationwide during the first five weeks after the outbreak, implying a 34 percent decrease in sales. The results also suggest an additional 42 million dollars were lost as the delay of some major movies lowered the overall quality of available movies in the market.

Suggested Citation

  • In Kyung Kim, 2021. "The impact of social distancing on box-office revenue: Evidence from the COVID-19 pandemic," Quantitative Marketing and Economics (QME), Springer, vol. 19(1), pages 93-125, March.
    • Handle: RePEc:kap:qmktec:v:19:y:2021:i:1:d:10.1007_s11129-020-09230-x
    DOI: 10.1007/s11129-020-09230-x
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    Cited by:

    1. Jiejie Wang & Mengli Zhang & Paul Adams & Peng Zheng & Xiaoli Wang, 2022. "Spatial and Temporal Characteristics and Influencing Factors of G20 Box Office Revenues: A Film Geography Perspective," Sustainability, MDPI, vol. 14(24), pages 1-16, December.
    2. Agnieszka Orankiewicz & Aleksandra Bartosiewicz, 2023. "The COVID-19 Pandemic and the Adoption Factors of Film Distribution Business Models in the Context of Sustainability," Sustainability, MDPI, vol. 15(15), pages 1-17, July.
    3. Jordi McKenzie, 2023. "The economics of movies (revisited): A survey of recent literature," Journal of Economic Surveys, Wiley Blackwell, vol. 37(2), pages 480-525, April.

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    More about this item

    Keywords

    COVID-19; Social distancing; Movie theater industry; Nested logit model;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L8 - Industrial Organization - - Industry Studies: Services
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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