Audience characteristics and the price of advertising in a circulation industry: evidence from US magazines [An article from: Information Economics and Policy]

This digital document is a journal article from Information Economics and Policy, published by Elsevier in 2004. The article is delivered in HTML format and is available in your Amazon.com Media Library immediately after purchase. You can view it with any web browser.

Description:
This paper investigates the impact of audience characteristics on the newsstand sales, the cover price and the price of advertising in the US magazine industry. Employing a unique data set describing 94 US magazines, a simultaneous equations model estimates the impact of various audience and magazine characteristics on the price of magazine advertising. The empirical model is guided by previous theoretical work that predicts audience characteristics may influence the price of advertising. The results indicate that average reader income, average reader age, the number of pages printed per year, and the possible number of advertising impressions enhance the price of advertising. On the other hand, a higher cover price, having local distribution, and a greater dependence on newsstand sales reduce the price publishers charge for advertising.