Coordination, Differentiation, and the Timing of Radio Commercials

34 Pages Posted: 26 Oct 2006

See all articles by Andrew T. Sweeting

Andrew T. Sweeting

Northwestern University - Department of Economics

Abstract

This paper examines the timing of commercial breaks by contemporary music radio stations. A simple model shows that stations may prefer, all else equal, to choose the same times (coordination) or different times (differentiation) for breaks depending on how listeners behave. It also shows that how much commercials overlap in Nash equilibrium should vary in different ways with observable market characteristics, such as the number of stations, depending on whether stations prefer to coordinate or differentiate. Panel data on the timing of commercials by 1,094 stations provide consistent support for the hypothesis that stations prefer to coordinate on timing.

Suggested Citation

Sweeting, Andrew T., Coordination, Differentiation, and the Timing of Radio Commercials. Journal of Economics & Management Strategy, Vol. 15, No. 4, pp. 909-942, Winter 2006. Available at SSRN: https://ssrn.com/abstract=940138 or http://dx.doi.org/10.1111/j.1530-9134.2006.00122.x

Andrew T. Sweeting (Contact Author)

Northwestern University - Department of Economics ( email )

2003 Sheridan Road
Evanston, IL 60208
United States

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