Quality signals in information cascades and the dynamics of the distribution of motion picture box office revenues

Authored by A De Vany, C Lee

Date Published: 2001-03

DOI: 10.1016/s0165-1889(00)00037-3

Sponsors: No sponsors listed

Platforms: No platforms listed

Model Documentation: Other Narrative

Model Code URLs: Model code not found

Abstract

The movies are an ideal testing ground for information cascade models. One can observe the dynamics of box office revenues from the `opening' to the end of the run. To study the possibility that information cascades occur in the movies one has to incorporate the fact that agents can observe box office revenues (as reported on the evening news) and communicate `word of mouth' information about the quality of the movies they have seen. One must consider many movies rather than the mere two choices assumed in information cascade models. We develop an agent-based model of information cascades with these extensions. Our objective is to see if the conclusions of information cascade models hold with these extensions (they do not) and to see if the agent-based model can capture the features of the motion picture box office revenues (it does). (C) 2001 Elsevier Science B.V. All rights reserved. JEL classification: C63; D83; L82.

Tags

box office revenues complex dynamics information cascade motion pictures quality information