Administrative trade barrier: An empirical analysis of exporting Hollywood movies to China |
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| Institution: | 1. UBC Sauder School of Business, University of British Columbia, Canada;2. Faculty of Business, Hong Kong Polytechnic University, China;3. Beedie School of Business, Simon Fraser University, Canada;1. Department of Marketing, College of. Business, City University of Hong Kong, Hong Kong;2. Department of Marketing, Carlson School of Business, University of Minnesota, United States;3. Department of Marketing, Marshall School of Business, University of Southern California, United States;1. Xiamen University, Fujian Province 361005, China;2. University of Cincinnati, Cincinnati, OH 45220, United States;1. Department of Industrial Engineering, University of Chile, Beauchef 851, Santiago, Chile;2. Columbia Business School, 3022 Broadway, New York, NY 10027, United States;3. Retail Management Institute at the Leavey School of Business at Santa Clara University, 500 El Camino Real, Santa Clara, CA 95053, United States;1. Department of Marketing, WU Vienna University of Economics and Business, Welthandelsplatz 1, A-1020 Vienna, Austria;2. MOSTLY AI Solutions, Hegelgasse 21/3, A-1010 Vienna, Austria;1. University of Cologne, Department of Marketing and Brand Management, Albertus-Magnus-Platz 1, D-50923 Cologne, Germany;2. Seeburg Castle University, Seeburgstraße 8, 5201 Seekirchen am Wallersee, Salzburg, Austria;3. University of Bremen, markstones Institute of Marketing, Branding & Technology, Max-von-Laue-Straße 1, 28359 Bremen, Germany |
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| Abstract: | Movies are among the US’s most successful exports, and China is by far the largest market. China welcomes high-quality US movies in order to grow its own theatrical market while also diligently protecting locally produced movies. China uses a movie import quota system to limit the number of foreign movies, half of which are delayed beyond the US release date by four or more weeks. We empirically study the Chinese government’s import decisions by developing a movie market demand model that integrates two models on concurrent and delayed releases where we consider release timing as an implicit trade barrier. We find that China tends to import US movies that are likely to expand the market demand but limits them from concurrent release when the potential cannibalization effect on local movies is high. Delayed releases of US movies are strongly associated with weaker box-office performance in China, making control of release schedule another vehicle that China leverages in import decisions. |
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| Keywords: | Movies Import regulation Chinese theatrical market International marketing Econometric analysis |
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