Munich Personal RePEc Archive

Should public broadcasting companies be continued, scrambled, disbanded or privatized?

Ohki, Kazuyoshi (2021): Should public broadcasting companies be continued, scrambled, disbanded or privatized?

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Abstract

In this paper, we construct a tractable mathematical model to examine the optimal structure of a public broadcasting company. We then compare four possible scenarios from a welfare perspective: a public broadcasting company continues operating, is scrambled, is disbanded or is privatized. In our setting, the situation where only some households choose scrambling is inferior to the situation where all households pay a license fee. However, if the need for the public broadcasting company is low, it should be disbanded. Under a uniform distribution, this reference point is that more than 50% of households agree to disband the public broadcasting company; however, this percentage is crucially dependent on the shape of the distribution. Our model also suggests that privatization of a public broadcasting company is superior to disbandment if the number of commercial broadcasting company is smaller than social optimum number.

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