A dynamic analysis of consolidation in the broadcast television industry

Preprint OPEN
Jessica C. Stahl;
(2009)
  • Subject: Television broadcasting

This paper estimates a dynamic oligopoly model in order to separately identify the demand-side and cost-side advantages of consolidation in the broadcast television industry. I exploit an exogenous change in regulation that led to significant industry consolidation. Usi... View more
  • References (5)

    Akkus, O. & Hortacsu, A. (2007). The determinants of bank mergers: A revealed preference analysis.

    Bajari, P., Benkard, L., & Levin, J. (2007). Estimating dynamic models of imperfect competition. Econometrica, 75, 1331{1370.

    Pakes, A., Porter, J., Ho, K., & Ishii, J. (2006). Moment inequalities and their application. Centre For Microdata Methods and Practices Working Paper.

    CPhoratrfaocltioeristic SDteavnidatairodn PEeffre‐cStt aotnion Revenue Number of Stations 4.9 ‐$1,035,000* Squared Positive Adjustment 0.75 Squared Negative Adjustment 1.81 Total Coverage in Millions 11.5 +$2,173,500* Avg Distance between Stations 430 +$245,100 Avg Distance * Number of Stations 5221 ‐$208,840 Avg Demographic Heterogeneity 12.1 ‐$205,700 Avg Demographic Heterogeneity * Number of Stations 126 +$844,000 Network Concentration 1.03 +$324,450 Network Concentration * Number of Stations 20 ‐$720,000* Network Domination 5.1 ‐$117,300 Network Domination * Number of Stations 202 +$303,000 Average Revenue Potential 15,900 +$16,160,000* Average Revenue Potential * Number of Stations 197 ‐$1,123* Avg Number among Competitors 7.2 ‐$986,400* Avg Total Coverage in Millions among Competitors 15.6 +$1,872,000* Avg Distance among Competitors 381 +$647,700* Average Demog Heterogeneity among Competitors 10.4 ‐$208,000 Average Network Concentration among Competitors 1.05 +$207,900 Average Network Domination among Competitors 5.66 ‐$916,920* † Except for adjustment coefficients, which are effects on a firm's total cost and profit.

    * Statistically significant at the 5% level.

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