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Are commercial ceilings adequate for the regulation of commercial overload on free-to-air TV channels?

Author

Listed:
  • Julia Rothbauer

    (Institute of Transport Economics, Muenster)

  • Gernot Sieg

    (Institute of Transport Economics, Muenster)

Abstract

Commercial ceilings not only restrict broadcasters in their decisions about commercial broadcasting time, but also affect their differentiation of program content. This study examines the welfare effects of commercial ceilings in a two-sided free-to-air TV market, taking into account welfare with respect to content differentiation. We identify a second-best commercial ceiling that maximizes welfare in the absence of enforceable program content regulation and identify the situations in which laissez faire is optimal. The deregulation of commercial broadcasting can improve welfare, even if the laissez-faire level of commercial broadcasting time is excessive.

Suggested Citation

  • Julia Rothbauer & Gernot Sieg, 2013. "Are commercial ceilings adequate for the regulation of commercial overload on free-to-air TV channels?," Working Papers 19, Institute of Transport Economics, University of Muenster, revised May 2014.
    • Handle: RePEc:mut:wpaper:19
    as

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    File URL: http://www.wiwi.uni-muenster.de/ivm/sites/ivm/files/documents/forschung/diskussionspapiere/workingpaper19final.pdf
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    References listed on IDEAS

    as
    1. Peitz, Martin & Valletti, Tommaso M., 2008. "Content and advertising in the media: Pay-tv versus free-to-air," International Journal of Industrial Organization, Elsevier, vol. 26(4), pages 949-965, July.
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    5. Seabright,Paul & von Hagen,Jürgen (ed.), 2007. "The Economic Regulation of Broadcasting Markets," Cambridge Books, Cambridge University Press, number 9780521874052.
    6. Seabright,Paul & von Hagen,Jürgen (ed.), 2007. "The Economic Regulation of Broadcasting Markets," Cambridge Books, Cambridge University Press, number 9780521696340, January.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    advertising regulation; content differentiation; welfare;
    All these keywords.

    JEL classification:

    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • M38 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Government Policy and Regulation

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