Munich Personal RePEc Archive

As Seen on TV: Price Discrimination and Competition in Television Advertising

Gil, Ricard and Riera-Crichton, Daniel and Ruzzier, Christian (2016): As Seen on TV: Price Discrimination and Competition in Television Advertising.

[img]
Preview
PDF
MPRA_paper_75993.pdf

Download (618kB) | Preview

Abstract

In this paper we examine the empirical relationship between price discrimination and competition in television advertising. While most empirical papers on the topic document a positive relationship, we find that price discrimination is negatively related to competition (as measured by the number of competing firms), a result that is consistent with conventional wisdom. Our results also show that only incumbent stations (unlike entrants) respond by engaging less in price discrimination when faced with a more competitive environment. Our evidence suggests that incumbents may use price discrimination as a strategic tool to accommodate entry - a strategy that has received scant attention in the existing entry literature.

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.