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Movie Industry Demand and Theater Availability

Author

Listed:
  • Tin Cheuk Leung

    (Wake Forest University)

  • Shi Qi

    (College of William and Mary)

  • Jia Yuan

    (University of Macau)

Abstract

Consumers can only choose to see a movie if it is available in theaters. Explicitly taking into account movie theater availability, we estimate a structural model of movie demand with the use of U.S. movie data from 1995 to 2017. Estimation results indicate that the impact of theater availability on movie demand is both statistically and economically significant. We also find that movie budget predictions based on the model that incorporates theater availability is more consistent with the data, while the model that ignores theater availability on average over-predict production budgets.

Suggested Citation

  • Tin Cheuk Leung & Shi Qi & Jia Yuan, 2020. "Movie Industry Demand and Theater Availability," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 56(3), pages 489-513, May.
    • Handle: RePEc:kap:revind:v:56:y:2020:i:3:d:10.1007_s11151-019-09706-5
    DOI: 10.1007/s11151-019-09706-5
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    References listed on IDEAS

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    Cited by:

    1. 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.
    2. Bernat Mallén Alberdi, 2023. ""The Effect of Competition on Language Diversity in the Movie-Theatre Industry"," IREA Working Papers 202305, University of Barcelona, Research Institute of Applied Economics, revised May 2023.
    3. Bernat Mallén, 2023. "“The Effect of Competition on Language Diversity in the Movie-Theatre Industry”," AQR Working Papers 202302, University of Barcelona, Regional Quantitative Analysis Group, revised May 2023.

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