The impact of social distancing on box-office revenue: Evidence from the COVID-19 pandemic

Research output: Contribution to journalArticlepeer-review

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.

Original languageEnglish
Pages (from-to)93-125
Number of pages33
JournalQuantitative Marketing and Economics
Volume19
Issue number1
DOIs
Publication statusAccepted/In press - 2020

Keywords

  • COVID-19
  • Movie theater industry
  • Nested logit model
  • Social distancing

ASJC Scopus subject areas

  • Economics, Econometrics and Finance (miscellaneous)
  • Marketing

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