Strategic Attractiveness and Release Decisions for Cultural Goods

27 Pages Posted: 11 Apr 2019

See all articles by Paul Belleflamme

Paul Belleflamme

CORE and Louvain School of Management, UCL (Université Catholique de Louvain); CESifo (Center for Economic Studies and Ifo Institute)

Dimitri Paolini

DiSea & CRENOS, Università di Sassari; Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE)

Date Written: Summer 2019

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.

Keywords: motion pictures, nonprice competition, strategic timing

JEL Classification: L13, L82

Suggested Citation

Belleflamme, Paul and Paolini, Dimitri, Strategic Attractiveness and Release Decisions for Cultural Goods (Summer 2019). Journal of Economics & Management Strategy, Vol. 28, Issue 2, pp. 198-224, 2019. Available at SSRN: https://ssrn.com/abstract=3369869 or http://dx.doi.org/10.1111/jems.12280

Paul Belleflamme (Contact Author)

CORE and Louvain School of Management, UCL (Université Catholique de Louvain) ( email )

34 Voie du Roman Pays
POBox L1.03.01
B-1348 Louvain-la-Neuve, B-1348
Belgium
+32 10 47 82 91 (Phone)
+32 10 47 43 01 (Fax)

HOME PAGE: http://perso.uclouvain.be/paul.belleflamme/Site/Home.html

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Dimitri Paolini

DiSea & CRENOS, Università di Sassari ( email )

Piazza Universita
Sassari, 07100
Italy

Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE) ( email )

34 Voie du Roman Pays
B-1348 Louvain-la-Neuve, b-1348
Belgium

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
1
Abstract Views
65
PlumX Metrics