Beck, Jonathan (2009): Diderot's rule.
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The odds of success in creative industries like the book, music or movie industry are often said to be particularly low. A 1763 rule by Denis Diderot, for example, says that only one out of ten published books is a commercial success. Yet, representative evidence on new-product success rates and their development over time is scarce. Furthermore, the standard approach to use sales as success measure can be misleading from the producer's perspective. This paper presents a novel approach to empirically identify producer success by incorporating the standard terms of contract between creator and producer into a parsimonious model of information diffusion (word-of-mouth). The model is applied to a random sample of novels. Parametric and semiparametric estimates imply a success rate between 10 and 15\% for this market. Set against Diderot's rule, these results suggest that new-product success in the book industry has been fairly constant over time.
|Item Type:||MPRA Paper|
|Original Title:||Diderot's rule|
|Keywords:||New-product success; word-of-mouth; creative industries; technological change|
|Subjects:||L - Industrial Organization > L8 - Industry Studies: Services > L82 - Entertainment; Media
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief
O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development; Intellectual Property Rights > O33 - Technological Change: Choices and Consequences; Diffusion Processes
|Depositing User:||Jonathan Beck|
|Date Deposited:||19. Sep 2009 18:06|
|Last Modified:||13. Feb 2013 10:14|
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