THE IMPACT OF SOCIAL DISTANCING ON BOX-OFFICE REVENUE: EVIDENCE FROM THE COVID-19 PANDEMIC

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Date

2020-10-21

Authors

Kim, Kyung

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Publisher

Quantitative Marketing and Economics

Abstract

In this paper, I study the short-run effect of social distancing due to the COVID-19 outbreak on movie demand and box-office revenue. Using longitudinal data on the Korean movie theater industry, I first estimate a nested logit model of movie demand, and then quantify the revenue loss in the industry. Estimation results reveal that the revenue loss due to the decrease in underlying movie demand is approximately 52 million dollars nationwide during the first five weeks after the outbreak, implying a 34 percent decrease in sales. The results also suggest an additional 42 million dollars were lost as the delay of some major movies lowered the overall quality of available movies in the market

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Keywords

Type of access: Open Access, COVID-19, Social distancing, Movie theater industry, Nested logit model

Citation

Kim, I. K. (2020). The impact of social distancing on box-office revenue: Evidence from the COVID-19 pandemic. Quantitative Marketing and Economics, 19(1), 93–125. https://doi.org/10.1007/s11129-020-09230-x

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