Strategic Attractiveness and Release Decision for Cultural Goods
Title | Strategic Attractiveness and Release Decision for Cultural Goods |
Publication Type | Journal Article |
Year of Publication | 2019 |
Authors | Belleflamme, P, Paolini, D |
Journal | Journal of Economics & Management Strategy |
Volume | 28 |
Issue | 2 |
Pagination | 198-224 |
Abstract | We study how producers of cultural goods can strategically invest in raising the attractiveness of their goods in order to secure the most profitable release dates. In a game‐theoretic setting, where two producers choose their investment expenditure before simultaneously setting the release date of their good, we prove that two equilibria are possible: releases are either simultaneous (at the demand peak) or staggered (one producer delays). In the latter equilibrium, the first‐mover secures its position by investing more in attractiveness. We test this prediction on a dataset of more than 1500 American movies released in 10 countries over 12 years. Results are consistent with the theoretical predictions, indicating that higher budget movies are released closer to seasonal demand peaks. |
URL | https://onlinelibrary.wiley.com/doi/full/10.1111/jems.12280 |
DOI | 10.1111/jems.12280 |
Keywords | Motion pictures, nonprice competition, Strategic timing |