TY - JOUR
T1 - Cheap Tuesdays and the demand for cinema
AU - De Roos, Nicolas
AU - McKenzie, Jordi
PY - 2014/3
Y1 - 2014/3
N2 - Many movie markets are characterised by extensive uniform pricing practices, hampering the ability to estimate price elasticities of demand. Australia presents a rare exception, with most cinemas offering cheap Tuesday ticket prices. We exploit this feature to estimate a random coefficients discrete choice model of demand for the Sydney region in 2007. We harness an extensive set of film, cinema, and time-dependent characteristics to build a rich demand system. Our results are consistent with a market expansion effect from the practice of discounted Tuesday tickets, and suggest that cinemas could profit from price dispersion by discounts based on observable characteristics.
AB - Many movie markets are characterised by extensive uniform pricing practices, hampering the ability to estimate price elasticities of demand. Australia presents a rare exception, with most cinemas offering cheap Tuesday ticket prices. We exploit this feature to estimate a random coefficients discrete choice model of demand for the Sydney region in 2007. We harness an extensive set of film, cinema, and time-dependent characteristics to build a rich demand system. Our results are consistent with a market expansion effect from the practice of discounted Tuesday tickets, and suggest that cinemas could profit from price dispersion by discounts based on observable characteristics.
KW - Cinema demand
KW - Discrete choice model
KW - Market expansion
KW - Motion pictures
UR - http://www.scopus.com/inward/record.url?scp=84896484496&partnerID=8YFLogxK
U2 - 10.1016/j.ijindorg.2014.02.004
DO - 10.1016/j.ijindorg.2014.02.004
M3 - Article
AN - SCOPUS:84896484496
SN - 0167-7187
VL - 33
SP - 93
EP - 109
JO - International Journal of Industrial Organization
JF - International Journal of Industrial Organization
ER -