Newspaper habit

This note analyzes the impact of habit formation in media markets on the behavior of a two-sided newspaper platform. Using a simple dynamic approach we find that habit formation (as well as indirect network effects) lead to higher quantities and profits. Price setting, however, strongly depends on network as well as on habit effects.

Cinema demand in Germany

In the present paper we examine the German cinema market using time series data of 49 years. Applying estimation techniques such as OLS, 2SLS and SUR, we identify interrelations between the number of screens, the average real prices and the demand for movies per inhabitant. Furthermore, we test for the long run relationship and evaluate the elasticities of demand with respect to real price and income. Moreover, we analyse if cinema can be defined as an addictive good which can be explained with a myopic habit or rational addiction approach. --cinema,demand,supply,habit formation,cointegration analysis,Seemingly Unrelated Regression

Demand Elasticities for Mobile Telecommunications in Austria

This paper analyses price elasticities in the Austrian market for mobile telecommunications services using data on firm specific tariffs in the period between January 1998 and March 2002. Dynamic panel data regressions are used to estimate short-run and long-run demand elasticities for business customers and for private consumers with both postpaid contracts and prepaid cards.We find that business customers have a higher elasticity of demand than private consumers, where postpaid customers tend to have a higher demand elasticity than prepaid customers. Also demand is generally more elastic in the long run. In addition, the paper also provides estimates for firm-specific demand elasticities which range from –0.47 to –1.1.Mobile telephony, price elasticities, unbalanced panel data, dynamic panel data analysis

Effects of landscape context on herbivory and parasitism at different spatial scales

Local community structure and interactions have been shown to depend partly on landscape context. In this paper we tested the hypothesis that the spatial scale experienced by an organism depends on its trophic level. We analyzed plant-herbivore and herbivore-parasitoid interactions in 15 agricultural landscapes differing in structural complexity using the rape pollen beetle (Meligethes aeneus), an important pest on oilseed rape (Brassica napus), and its parasitoids. In the very center of each landscape a patch of potted rape plants was placed in a grassy field margin strip for standardized measurement. Percent non-crop area of landscapes was negatively related to plant damage caused by herbivory and positively to the herbivores’ larval mortality resulting from parasitism. In a geographic scale analysis, we quantified the structure of the 15 landscapes for eight circular sectors ranging from 0.5 to 6 km diameter. Correlations between parasitism and non-crop areas as well as between herbivory and non-crop area were strongest at a scale of 1.5 km, thereby not supporting the view that higher trophic levels experience the world at a larger spatial scale. However, the predictive power of non-crop area changed only slightly for herbivory, but greatly with respect to parasitism as scales from 0.5 to 1.5 km and from 1.5 to 6 km diameter increased. Furthermore, the effect of non-crop area tended to be stronger in parasitism than herbivory suggesting a greater effect of changes in landscape context on parasitoids. This is in support of the general idea that higher trophic levels should be more susceptible to disturbance. (Thies, C., Steffan-Dewenter, I. and Tscharntke, T. 2003. Effects of landscape context on herbivory and parasitism at different spatial scales. – Oikos 101: 18–25.

Indirect network effects with two Salop circles: the example of the music industry

This paper analyses the interdependency between the market for music recordings and concert tickets, assuming that there are positive indirect network effects both from the record market to ticket sales for live performances and vice versa. Using a model with two interrelated Salop circles we show that prices in both markets are corrected down- wards when compared to the standard Salop model. Furthermore, we show that the effects of file sharing on firms' profitability and on variety are ambiguous. File sharing can increase profits through increased concert ticket demand and thereby also lead to additional market entry and additional variety. --Music Industry,Indirect Network Effects,Salop Model,File Sharing

Co-determination and Innovation

This paper examines the effect of the German co-determination law of 1976 (MitbestG) on the innovative activity of German firms. Co-determination applies to firms with 2000 employees or more. Data from 1971-1976 and 1981-1990 on 148 firms are used to compare the number of patents granted to co-determined firms before and after the introduction of the law. Several control variables are applied and in particular, in order to avoid a possible bias from specific effects of firm size, we compare the co-determined firms with others before and after 1976. The results do not support the view that co-determination slows down technological progress and reduces innovativeness.co-determination, innovation, patents

On file sharing with indirect Network effects between concert ticket sales and music recordings

This paper analyses the interdependency between the market for music recordings and concert tickets, assuming that there are positive indirect network effects both from the record market to ticket sales for live performances and vice versa. In a model with two interrelated Hotelling lines prices in both markets are corrected downwards when compared to the standard Hotelling model. Also, file sharing has ambiguous effects on firms' profitability. As file sharing can indirectly increase demand for live performances overall profits can either increase or decrease, depending on the strength of indirect network effects. Finally, file sharing may induce firms to switch from the traditional business model with two separate firms to an integrated business model where one agency markets both records and concerts (so-called 360 degree deals). --

Indirect network effects with two salop circles: the example of the music industry

This paper analyses the interdependency between the market for music recordings and concert tickets, assuming that there are positive indirect network effects both from the record market to ticket sales for live performances and vice versa. Using a model with two interrelated Salop circles we show that prices in both markets are corrected downwards when compared to the standard Salop model. Furthermore, we show that the effects of file sharing on firms' profitability and on variety are ambiguous. File sharing can increase profits through increased concert ticket demand and thereby also lead to additional market entry and additional variety. --Music Industry,Indirect Network Effects,Salop Model,File Sharing