Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/63155 
Year of Publication: 
2005
Series/Report no.: 
Memorandum No. 2005,15
Publisher: 
University of Oslo, Department of Economics, Oslo
Abstract: 
We consider a model where TV channels transmit advertising, and viewers dislike such commercials. We find that the less differentiated the TV channels’ programs are, the lower is the amount of advertising in equilibrium. Relative to the social optimum, there is underprovision of advertising if TV channels are sufficiently close substitutes. In such a situation, a merger between TV channels may lead to more advertising and thus improve welfare. A publicly owned TV channel can partly correct market distortions, in some cases by having a larger amount of advertising than a private TV channel. It may actually have advertising even in cases where it is wasteful per se.
Subjects: 
Television industry
Advertising
Public policy
Mixed oligopoly
JEL: 
L82
M37
Document Type: 
Working Paper

Files in This Item:
File
Size
346.59 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.