nep-cul New Economics Papers
on Cultural Economics
Issue of 2007‒08‒08
nine papers chosen by
Roberto Zanola
University of the Piemonte Orientale

  1. Negotiating Memories of War: Arts in the Vietnamese American Communities By Yen Le Espiritu
  2. Visual Culture and Visual Piety in Little Haiti: The Sea, the Tree, and the Refugee By Terry Rey; Alex Stepick
  3. The Organizational Implications of Creativity: The US Film Industry in Mid-XXth Century By Ricard Gil; Pablo T. Spiller
  4. When Pricing Below Marginal Cost Pays Off: Optimal Price Choice in a Media Market with Upfront Pricing By Ulrich Kaiser
  5. Economic Impact of Bonnaroo Music Festival on Coffee County By Murat Arik
  6. In-Store Media and Channel Management By Anthony Dukes; Yunchuan Liu
  7. Do Media Consumers Really Dislike Advertising? An Empirical Assessment of a Popular Assumption in Economic Theory By Ulrich Kaiser
  8. Do Magazines' ”Companion Websites” Cannibalize the Demand for the Print Version? By Ulrich Kaiser; Hans Christian Kongsted
  9. An Analysis on Market Structure of Broadcast Service – Issues on Optimal Level of Channel Variety – By Shishikura, Manabu; Kasuga, Norihiro

  1. By: Yen Le Espiritu (University of California, San Diego)
    Abstract: In the United States, the writing on the Vietnam War involves the highly organized and strategic forgetting of the Vietnamese people. In a highly original work that investigates the production of American cultural memory, Marita Sturken shows that in the United States, the narrative of the Vietnam War foregrounds the painful experience of the Vietnam veterans in such a way that the Vietnamese people are forgotten: “They are conspicuously absent in their roles as collaborators, victims, enemies, or simply the people whose hand and over whom (supposedly) this war was fought” (Sturken 1997, 62). Likewise, US scholars have refused to treat Vietnamese refugees as genuine subjects, with their own history, culture, heritage, and political agendas.
    Date: 2006–06
  2. By: Terry Rey (Temple University); Alex Stepick (Florida International University)
    Abstract: Religious images, especially the Virgin Mary and Saint James the Greater, dominate the resplendent visual culture of Haiti and its diaspora.1 Whether in the mountains of Haiti or the streets of Miami’s Little Haiti, however, their meanings vary and are contested among Haitian believers. For Catholics, the Virgin Mary and Saint James the Greater are, respectively, Christ’s mother and one of his apostles. For practitioners of Vodou, they might represent instead Ezili and Ogun, spirits originally from the Africa of their enslaved ancestors. And for Protestants, , they might represent the idolatry causing Haiti’s many and grave social ills. For all religious Haitians these images are deeply invested with meaning, however divergent their interpretations may be.
    Date: 2006–06
  3. By: Ricard Gil; Pablo T. Spiller
    Abstract: We develop a basic framework to understand the organization of highly creative activities. Management faces a fundamental tradeoff in organizing such activities. On the one hand, since creativity cannot be achieved by command and control or by monetary incentives, internal/contractual production of creative products is plagued by hazards arising from their fundamental characteristics: extremely high input, output and market uncertainty, and the inherent informational advantages of creative talent. Procuring highly creative products in the market place, though, exposes the distributor to a fundamental risk: independently produced creative goods are generic distribution-wise. Thus, in procuring creative products in the marketplace, distributors face the unavoidable winner's curse risk. Since this risk is, to a large extent, independent of the creative nature of the product, the higher the creative content, the higher the relative hazards associated with internal or contractual production. Thus, internal/contractual production of creative goods will tend to be less prevalent the higher the creative content associated with its production. We apply this insight to the evolution of the U.S. film industry in the mid-XXth century. We exploit two simultaneous natural experiments -- the diffusion of TV and the Paramount antitrust decision forcing the separation of exhibitors from distributors and prohibiting the use of block-booking. Both events increased the demand for creative content in movies. We develop empirical implications which we test by analyzing in detail the decision by distributors to produce films internally or to procure then in the market place, in the face of an increase in the demand for creative content.
    JEL: L22 L23 L24 L26 L82
    Date: 2007–07
  4. By: Ulrich Kaiser (University of Southern Denmark)
    Abstract: I derive a model of profit maximization for a print media firm with upfront advertising pricing. The model is estimated using detailed quarterly data on German women's magazines observed between I/1994 and IV/2004. Main empirical results are that (i) cover price increases lead to substantial reductions in advertising revenue, thereby offsetting possible corresponding gains in magazine sales revenue, (ii) magazines with particularly large advertising revenues per copy set cover prices well below marginal cost and (iii) marginal production cost are decreasing in a magazine's own circulation but are unaffected by the own publishers' total printing volume which does not provide evidence for an efficiency defense in print media mergers.
    Keywords: magazines; cost estimation; twosided markets
    JEL: L11 C33
    Date: 2007–04
  5. By: Murat Arik
    Date: 2005–11
  6. By: Anthony Dukes (University of Aarhus); Yunchuan Liu (University of Illinois at Urbana-Champaign)
    Abstract: In this paper, we study the interesting and complicated effects of retailer in-store media on distribution channel relationships. With the help of advanced technology, retailers can open in-store media in their stores and allow manufacturers to advertise through the instore media. We show that opening in-store media is a strategic decision for a retailer, and a retailer may strategically subsidize manufacturers on their advertising through instore media to better coordinate the channel. Even when in-store media is more effective than commercial media (i.e., radio, TV, newspaper, etc.), a retailer may still charge an advertising rate lower than commercial media does. We also show that the benefit of instore media to a retailer can be a U-shaped curve of manufacturer bargaining power, and a retailer may introduce in-store media only when manufacturer bargaining power is either very high or very low, but not intermediate. With manufacturer competition, a retailer can strategically use in-store media to ration excessive advertising between manufacturers, achieving better channel coordination. When manufacturers are asymmetric with pre-advertising brand awareness, a retailer has incentive to subsidize manufacturers whose brand awareness is higher. We also find that retailer in-store media can benefit social welfare even when in-store media is less effective than commercial media. However, if in-store media effectiveness is very low, a retailer may introduce instore media for its own benefit with the sacrifice on social welfare.
    Keywords: in-store media; advertising; distribution channel; channel coordination; retailing
    Date: 2007–06
  7. By: Ulrich Kaiser (University of Southern Denmark)
    Abstract: This paper uses data on the population of German magazines for the period 1973 to 2004 to show that, contrary to conventional wisdom, there is little evidence for magazine readers disliking advertising. Many magazines in fact have readers who appreciate advertising. The degree of appreciation increases in reader age and decreases with income as well as with education.
    Keywords: two-sided markets; advertising; Mean Group Estimation; media markets; nuisance
    JEL: C23 L11
    Date: 2007–05
  8. By: Ulrich Kaiser (University of Southern Denmark); Hans Christian Kongsted (Department of Economics, University of Copenhagen)
    Abstract: We analyze the extent to which visits to a magazine's companion website affects total circulation, subscription, kiosk sales and foreign sales using Granger causality tests on the basis of monthly data for the German magazine market spanning the period January 1998 to September 2005. We find evidence for positive effects of website visits on magazine subscription but negative effects on magazine kiosk sales. Contrary to the widespread belief that the Internet will cannibalize print media markets, our results do not, however, provide evidence for website visits adversely affecting total circulation.
    Keywords: Granger causality; heterogeneous panel data models; Mean Group Estimation; website visits; magazine circulation
    JEL: C32 C33 L11
    Date: 2007–06
  9. By: Shishikura, Manabu; Kasuga, Norihiro
    Abstract: Unlike general goods, broadcasting service is financed not only by consumer’s direct payment but also by advertisement revenue. In other words, broadcasting service is supported by direct and indirect financial sources. However, rate of dependence on those financial sources are different by each media type; Terrestrial broadcasting carrier primarily depends on advertisement revenue while cable TV carrier and satellite carrier, which is called as pay-TV primarily depend on payment from audience in addition to small amount of advertisement revenue. In this paper, we examine broadcast market, where carriers with different financial sources compete in the market, and analyze market performance as a result of competition. Especially, we focus on the effect of competition in the mixed market which includes advertising supported media and subscription fee supported media. We made economic model and analyze the difference on several types of market. Our principle results of Case III, the market that an advertisement supported carrier and a subscription supported carrier compete in the market, are as follows;. (1) The greater the substitutability is, the number of channels supplied by advertisement supported media increases while those supplied by subscription fee supported carrier decreases. (2) Total number of channels supplied by advertisement supported carrier and subscription fee supported carrier is equal to the number of channels supplied by an advertisement supported carrier (Case II). (3) Total TV watching time of Case III is equal to Case II. (4) Because the amount of payment by consumer increases compared to Case II, consumer surplus decreases. General economic model predicts that the increase of the number of entrants brings the increase of consumer surplus. However, in our model, we show here that the increase of the number of entrants does not necessarily bring the increase of consumer surplus.
    Keywords: broadcast service; market performance; consumer welfare; advertisement supported /subscription fee supported media.
    JEL: D40 L50 L82 D60
    Date: 2007–08–02

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