The Welfare Effects of Vertical Integration in Multichannel Television Markets
We investigate the welfare effects of vertical integration of regional sports networks (RSNs) with programming distributors in U.S. multichannel television markets. Vertical integration can enhance efficiency by reducing double marginalization and increasing carriage of channels, but can also harm w...
| Main Authors: | , , , |
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| Other Authors: | |
| Format: | Article |
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The Econometric Society
2019
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| Online Access: | http://hdl.handle.net/1721.1/120992 https://orcid.org/0000-0001-8983-157X |
| _version_ | 1826209569881194496 |
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| author | Crawford, Gregory S. Lee, Robin S. Yurukoglu, Ali Whinston, Michael Dennis |
| author2 | Massachusetts Institute of Technology. Department of Economics |
| author_facet | Massachusetts Institute of Technology. Department of Economics Crawford, Gregory S. Lee, Robin S. Yurukoglu, Ali Whinston, Michael Dennis |
| author_sort | Crawford, Gregory S. |
| collection | MIT |
| description | We investigate the welfare effects of vertical integration of regional sports networks (RSNs) with programming distributors in U.S. multichannel television markets. Vertical integration can enhance efficiency by reducing double marginalization and increasing carriage of channels, but can also harm welfare due to foreclosure and incentives to raise rivals' costs. We estimate a structural model of viewership, subscription, distributor pricing, and affiliate fee bargaining using a rich data set on the U.S. cable and satellite television industry (2000–2010). We use these estimates to analyze the impact of simulated vertical mergers and divestitures of RSNs on competition and welfare, and examine the efficacy of regulatory policies introduced by the U.S. Federal Communications Commission to address competition concerns in this industry. |
| first_indexed | 2024-09-23T14:24:33Z |
| format | Article |
| id | mit-1721.1/120992 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T14:24:33Z |
| publishDate | 2019 |
| publisher | The Econometric Society |
| record_format | dspace |
| spelling | mit-1721.1/1209922022-10-01T21:11:47Z The Welfare Effects of Vertical Integration in Multichannel Television Markets Crawford, Gregory S. Lee, Robin S. Yurukoglu, Ali Whinston, Michael Dennis Massachusetts Institute of Technology. Department of Economics Sloan School of Management Whinston, Michael Dennis We investigate the welfare effects of vertical integration of regional sports networks (RSNs) with programming distributors in U.S. multichannel television markets. Vertical integration can enhance efficiency by reducing double marginalization and increasing carriage of channels, but can also harm welfare due to foreclosure and incentives to raise rivals' costs. We estimate a structural model of viewership, subscription, distributor pricing, and affiliate fee bargaining using a rich data set on the U.S. cable and satellite television industry (2000–2010). We use these estimates to analyze the impact of simulated vertical mergers and divestitures of RSNs on competition and welfare, and examine the efficacy of regulatory policies introduced by the U.S. Federal Communications Commission to address competition concerns in this industry. National Science Foundation (U.S.) Economic and Social Research Council (Great Britain) (Grant RES‐062‐23‐2586) New York University. Stern Center for Global Economy and Business Toulouse Network for Information Technology 2019-03-15T18:30:40Z 2019-03-15T18:30:40Z 2018-05 2019-03-06T14:48:28Z Article http://purl.org/eprint/type/JournalArticle 0012-9682 http://hdl.handle.net/1721.1/120992 Crawford, Gregory S., Robin S. Lee, Michael D. Whinston, and Ali Yurukoglu. “The Welfare Effects of Vertical Integration in Multichannel Television Markets.” Econometrica 86, no. 3 (2018): 891–954. https://orcid.org/0000-0001-8983-157X http://dx.doi.org/10.3982/ECTA14031 Econometrica Creative Commons Attribution-Noncommercial-Share Alike http://creativecommons.org/licenses/by-nc-sa/4.0/ application/pdf The Econometric Society Other repository |
| spellingShingle | Crawford, Gregory S. Lee, Robin S. Yurukoglu, Ali Whinston, Michael Dennis The Welfare Effects of Vertical Integration in Multichannel Television Markets |
| title | The Welfare Effects of Vertical Integration in Multichannel Television Markets |
| title_full | The Welfare Effects of Vertical Integration in Multichannel Television Markets |
| title_fullStr | The Welfare Effects of Vertical Integration in Multichannel Television Markets |
| title_full_unstemmed | The Welfare Effects of Vertical Integration in Multichannel Television Markets |
| title_short | The Welfare Effects of Vertical Integration in Multichannel Television Markets |
| title_sort | welfare effects of vertical integration in multichannel television markets |
| url | http://hdl.handle.net/1721.1/120992 https://orcid.org/0000-0001-8983-157X |
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