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Product Differentiation and Film Programming Choice: Do First-Run Movie Theatres Show the Same Films?

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  • Darlene C. Chisolm
  • Margaret McMillan
  • George Norman

Abstract

We present an empirical analysis of product differentiation using a new dynamic panel data set on film programming choice in a major U.S. metropolitan motion-pictures exhibition market. Using these data, we compute two measures of film programming choice, which allow us to investigate the determinants of strategic product differentiation in a multi-characteristics space. Our evidence is consistent with the idea that the degree of product differentiation between theatre pairs reflects a balance between strategic concerns and contractual constraints. Similarity in one dimension is offset by differentiation in others. Our results further suggest that the degree of product differentiation is negatively related to market size. Finally, we find thta ownership matters theatres under common ownership make more similar programming choices than theatres with different owners.

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  • Darlene C. Chisolm & Margaret McMillan & George Norman, 2007. "Product Differentiation and Film Programming Choice: Do First-Run Movie Theatres Show the Same Films?," Discussion Papers Series, Department of Economics, Tufts University 0713, Department of Economics, Tufts University.
    • Handle: RePEc:tuf:tuftec:0713
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    3. Darlene Chisholm & Margaret McMillan & George Norman, 2010. "Product differentiation and film-programming choice: do first-run movie theatres show the same films?," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 34(2), pages 131-145, May.
    4. Gilbert Metcalf & Jongsang Park, 2007. "A comment on the role of prices for excludable public goods," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 14(6), pages 685-698, December.
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    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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