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Economics of Domestic Cultural Content Protection in Broadcasting, The

Author

Listed:
  • Bekkali, Mukhtar
  • Beghin, John C.
Abstract
We analyze the economics of domestic cultural content protection in terrestrial broadcasting, the most widespread policy instrument used in broadcasting. Using the love-of-variety approach, we model a representative consumer deriving utility from broadcasting services net of advertising,and allocating scarce time between consuming the various broadcasting services and leisure. Advertising is a nuisance; it costs time yet brings no utility. Broadcasting is a pure public good; broadcasters make profit in the monopolistic competition environment by bundling advertising with valuable cultural content. We impose a discrete domestic content requirement and then investigate the effects of its marginal changes on consumption of domestic broadcasting. Domestic content requirement may reduce (increase) consumption of domestic programs when consumer's demand is highly elastic (inelastic), the degree of preference for foreign content over domestic content is high (low) and opportunity cost of listening time is high (low). The reduction occurs because the consumer reshuffles her consumption bundle towards leisure away from high domestic-content stations thereby reducing the overall aggregate consumption of broadcasting, and subsequently, the overall aggregate consumption of domestic programs.

Suggested Citation

  • Bekkali, Mukhtar & Beghin, John C., 2005. "Economics of Domestic Cultural Content Protection in Broadcasting, The," Staff General Research Papers Archive 12476, Iowa State University, Department of Economics.
    • Handle: RePEc:isu:genres:12476
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    File URL: http://www2.econ.iastate.edu/papers/p1878-2005-11-17.pdf
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    References listed on IDEAS

    as
    1. Beghin, John C & Sumner, Daniel A, 1992. "Domestic Content Requirements with Bilateral Monopoly," Oxford Economic Papers, Oxford University Press, vol. 44(2), pages 306-316, April.
    2. Michael L. Mussa, 1984. "The Economics of Content Protection," NBER Working Papers 1457, National Bureau of Economic Research, Inc.
    3. Simon P. Anderson & Stephen Coate, 2000. "Market Provision of Public Goods: The Case of Broadcasting," NBER Working Papers 7513, National Bureau of Economic Research, Inc.
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    6. Partha Dasgupta & Eric Maskin, 1986. "The Existence of Equilibrium in Discontinuous Economic Games, II: Applications," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 53(1), pages 27-41.
    7. Thomas Krattenmaker & Lucas Powe, 1994. "Regulating Broadcast Programming," Books, American Enterprise Institute, number 53082, September.
    8. André Sapir, 1991. "Le commerce international des services audiovisuels: une source de conflits entre la Communauté Européenne et les Etats-Unis," ULB Institutional Repository 2013/8218, ULB -- Universite Libre de Bruxelles.
    9. Hollander, Abraham, 1987. "Content protection and transnational monopoly," Journal of International Economics, Elsevier, vol. 23(3-4), pages 283-297, November.
    10. Dixit, Avinash K, 1986. "Comparative Statics for Oligopoly," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 27(1), pages 107-122, February.
    11. Kala Krishna & Motoshige Itoh, 1988. "Content Protection and Oligopolistic Interactions," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 55(1), pages 107-125.
    12. Gene M. Grossman, 1981. "The Theory of Domestic Content Protection and Content Preference," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 96(4), pages 583-603.
    13. Francois, Patrick & van Ypersele, Tanguy, 2002. "On the protection of cultural goods," Journal of International Economics, Elsevier, vol. 56(2), pages 359-369, March.
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    Cited by:

    1. Nobuko Serizawa & Shigeru Wakita, 2016. "Variety-Controlling Public Policy Under Addiction and Saturation," The Japanese Economic Review, Springer, vol. 67(1), pages 125-140, March.
    2. repec:vuw:vuwscr:19276 is not listed on IDEAS
    3. Nobuko Serizawa & Shigeru Wakita, 2016. "Variety-Controlling Public Policy Under Addiction and Saturation," The Japanese Economic Review, Japanese Economic Association, vol. 67(1), pages 125-140, March.
    4. Hurren, Konrad, 2014. "The Microeconomics of Television Markets," Working Paper Series 19276, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    5. Hurren, Konrad, 2014. "The Microeconomics of Television Markets," Working Paper Series 4283, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    6. Janeba, Eckhard, 2007. "International trade and consumption network externalities," European Economic Review, Elsevier, vol. 51(4), pages 781-803, May.

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    More about this item

    Keywords

    boradcasting; domestic content; radio; cultural protection;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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