[Econmaster2012] Research Seminar in Economics-Announcement

[Johannes Pfeifer]

Dear All,

 

we are happy to announce the following  Research Seminar in Economics to
take place on Tuesday, November 6th  at  18:00 - 19:30 in room E03, ground
floor, Mohlstraße 36.

 

Presenter:  Martin Richardson – Australian National University

 

Title:  "Faddists, enthusiasts and Canadian divas: a model of the recorded
music market (with an application to local content requirements in
broadcasting)"

 

Abstract:

 

This paper constructs a model of the provision of commercial music in which
some

consumers (enthusiasts) enjoy diversity and others (faddists) prefer to
follow what is

popular. Record companies sign up bands, only some of whom will ‘succeed’ –
a

process modeled in a number of alternate ways – and radio stations broadcast

recordings. Consumers hear music on the radio and purchase recordings, where
the

likelihood of purchase depends, in part, on the extent of radio airplay for
a particular

recording. We show that consumers’ taste for diversity leads to under-entry
in

general and we illustrate the working of the model by considering the impact
of a

local content quota in broadcasting. It is shown that a quota that restricts
the airtime

devoted to foreign music induces a shift in the pattern of band entry into

‘international’ genres. But a mild quota is welfare-improving in this model:
even

though the diversity of local music is reduced, the quota increases the
number of new

entrants, drawn in by the increased profitability of success. We also
discuss the

consequences of a quota that requires increased broadcasting of ‘new’ music
and

show that, while the addition of the ‘new’ band component decreases the
total amount

of time devoted to listening to the radio by consumers (yielding a welfare
loss), it

does nothing to a record company’s incentives to sign up new bands.

 

 

Regards,

 

Prof. Dr. Johannes Pfeifer

 

--

Johannes Pfeifer

Department of Economics

University of Tuebingen

Mohlstrasse 36

72074 Tuebingen

Germany

Phone: +49 7071 2974137

 

-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://listserv.uni-tuebingen.de/pipermail/econmaster2012/attachments/20121104/b17065f6/attachment.html>