Edited by Ruth Towse
Chapter 12: Cinema
Samuel Cameron There is still a tendency among economists to write of film and cinema as synonymous. Articles submitted to the Journal of Cultural Economics frequently display this trait. Clearly they are not the same thing. The cinema is an economic and social space where films are watched (in consumer speak) and exhibited (in industry speak). Although the distinction is simple, it is muddied by the use of terms like ‘home cinema’ to describe the experience of watching DVDs (digital video disks), or other file formats, on surroundsystem speakers with (usually) large screens. This brings up the issue of the home versus the cinema film-watching experience. This may be substitute or complement. Substitution comes from the relative price of cinema-going versus the price of home viewing. Complementarity would arise from mutual linkages. Greater enjoyment of cinema may increase home cinema consumption through an interest in movies per se. The DVD (or film download) experience may increase interest through repeat viewing, enjoyment of extras and so on. There may be an element of so-called ‘rational addiction’ in cinema-going in that consumption in the past influences consumption in the future. This would suggest that the long-run impact of price cuts would potentially be much bigger than the short-run impact. The pricing decision in the cinema industry is one of its most unusual features and is dealt with below. Cinema-going is a complex commodity in which the purchase of a ticket to view a film is one element. Historically other features have accompanied...
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