Consumers as risk takers: evidence from the film industry during the 1930s

Sedgwick, John and Pokorny, Michael (2010) Consumers as risk takers: evidence from the film industry during the 1930s. Business History, 52 (1). pp. 74-99. ISSN 0007-6791

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This paper examines the risk environment of film consumption in the United States during the 1930s when moviegoing dwarfed all other paid-for leisure activities. We argue that the wide variability in the financial performance of films, reflecting the considerable risks that were involved in film production, can be interpreted as being mirrored in the risks incurred by consumers in the film consumption process. We further argue that production risk needs to be understood within the context of consumer risk. Using a dataset derived from the trade journal Variety, we examine the weekly fortunes of movies in first-run cinemas as consumers rapidly substitute movies that are currently on release for the promised pleasures of yet unseen movies. That expected utility was not always realised was commonplace, as was the pleasurable surprise that came with being thrilled by certain films. These are important results since, perhaps for the first time in modern society, they led to the emergence of the long right tail of consumer preferences for mass distributed goods.

Item Type: Article
Subjects: University of Westminster > Westminster Business School
Depositing User: Miss Nina Watts
Date Deposited: 17 Mar 2010 09:59
Last Modified: 18 Oct 2011 10:34

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