How do your rivals’ releasing dates affect your box office?

In this paper, we study to what extent a movie’s box-office receipts are affected by the temporal distribution of rival films. We propose a reduced-form empirical model to measure and test competition effects among films released close to each other in a standard regression framework. Such an analysis is appealing in terms of its policy implication and may provide guidance to distributors to decide on their releasing dates of their firms. We estimate this model using information on the films released in five countries: the USA, the United Kingdom, Germany, France and Spain. The geographical dimension of our data set permits us to control for unobserved heterogeneity among films released using panel data techniques, which allows us to evaluate the individual and specific effects of each film. Thus we deal with one of the most relevant features of the movie market, namely the presence of highly differentiated products. Copyright Springer Science+Business Media New York 2014