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Time spent on New Songs: Word-of-Mouth and Price Effects on Teenager Consumption

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The stardom system characterizes creative industries: the demand and revenues are concentrated on a few bestselling books, movies or music. In this paper, we study the demand structure between bestsellers and new artists' productions in the music industry. We set up an experiment where participants face real choices situations. We crate three treatments to isolate the effect of information and incentives on diversity. In a first treatment, music is consumed for free without information. In a second one, subjects receive a prior information on others' evaluation of songs to study the effect of word-of-mouth. Finally, in a third one, a real market is introduced and music is bought. Significant evidence shows that word-of-mouth lowers diversity, while price incentives tend to lift it. In both treatments, subjects also react to the information or incentives nature

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  • Noémi Berlin & Anna Bernard & Guillaume Fürst, 2015. "Time spent on New Songs: Word-of-Mouth and Price Effects on Teenager Consumption," Documents de travail du Centre d'Economie de la Sorbonne 15027, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    • Handle: RePEc:mse:cesdoc:15027
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    1. Adler, Moshe, 1985. "Stardom and Talent," American Economic Review, American Economic Association, vol. 75(1), pages 208-212, March.
    2. Bianchi, Marina, 2002. "Novelty, preferences, and fashion: when goods are unsettling," Journal of Economic Behavior & Organization, Elsevier, vol. 47(1), pages 1-18, January.
    3. Bikhchandani, Sushil & Hirshleifer, David & Welch, Ivo, 1992. "A Theory of Fads, Fashion, Custom, and Cultural Change in Informational Cascades," Journal of Political Economy, University of Chicago Press, vol. 100(5), pages 992-1026, October.
    4. Nelson, Phillip, 1970. "Information and Consumer Behavior," Journal of Political Economy, University of Chicago Press, vol. 78(2), pages 311-329, March-Apr.
    5. Abhijit V. Banerjee, 1992. "A Simple Model of Herd Behavior," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(3), pages 797-817.
    6. Adler, Moshe, 2006. "Stardom and Talent," Handbook of the Economics of Art and Culture, in: V.A. Ginsburgh & D. Throsby (ed.), Handbook of the Economics of Art and Culture, edition 1, volume 1, chapter 25, pages 895-906, Elsevier.
    7. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-858, December.
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    Cited by:

    1. Patrizia Lattarulo & Marco Mariani & Laura Razzolini, 2017. "Nudging museums attendance: a field experiment with high school teens," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 41(3), pages 259-277, August.
    2. Bronwyn Coate & Robert Hoffmann, 2022. "The behavioural economics of culture," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 46(1), pages 3-26, March.
    3. Marc Bourreau & Marianne Lumeau & Francois Moreau & Jordana Viotto da Cruz, 2019. "Recent or Free? An Experimental Study of the Motivations for Pirating Movies," CESifo Working Paper Series 8036, CESifo.

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    More about this item

    Keywords

    Experimental economics; Cultural Goods; Music industry; Stardom System;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • Z1 - Other Special Topics - - Cultural Economics

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