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The Economics of Superstars
... Global markets are characterised by extreme and growing concentration. Almost twenty years ago, Bernard et al. [1] documented that the largest 1 percent of trading firms, formally defined in the literature as superstar firms [2], was responsible for over 80 percent of the value of total US trade. Since their seminal publication, a similar pattern has consistently come up in most developed and developing nations [3][4][5]. ...
... In Figure 5, we present the effect of an export subsidy on the monopolistically competitive firms, where the subsidy takes the form of a decreased trade cost faced by these firms. In other words, oligopolistic firms face the real trade cost τ = 2, whereas the MC firms face a trade costτ ∈ [1,2]. The difference between the two costs τ −τ is equal to the subsidy per unit of exported output. ...
... The difference between the two costs τ −τ is equal to the subsidy per unit of exported output. Reading the plots from right to left, as small firms face a higher export subsidy, which is as if they faced a lower trade costτ ∈ [1,2], observe the effect on the total small (MC) firms' profits, total large (CO) firms' profits, aggregate price, the equilibrium number of firms, welfare gains from the policy, the home and export markup gap between large and small firms, average markup and markup dispersion. ...
International markets are extremely polarised, with a few big superstar businesses operating alongside numerous small competitors, and globalisation has been highlighted as a powerful force behind the superstars' increasingly dominant presence. The empirical literature has established that superstars are more efficient compared to their smaller counterparts, and, unlike them, they exhibit strategic behaviour. Building on this evidence, we develop a model to examine how an initial productivity advantage allows a select few firms to expand, via innovation, to the extent that it becomes optimal to adopt strategic behaviour, and show how polarised markets emerge endogenously as the unique subgame perfect equilibrium in pure strategies. We then introduce international trade and show that, in polarised markets, trade liberalisation puts into motion a novel composition effect, reallocating market share from smaller to larger rivals and raising large firms' profits. This effect suppresses the pro-competitive welfare gains from trade and cements the dominant position of big businesses, who come out as the big winners of globalisation. We find that, although trade increases welfare, by reducing average markup and markup heterogeneity, in the presence of a handful of large powerful firms, welfare gains are severely diminished, and subsidising smaller enterprises may turn out to be welfare-enhancing.
... Top performers have always produced the bulk of publications in all national science systems (Rosen 1981;Ioannidis et al. 2014;Xie 2014). However, it is interesting to analyze their role in a single, hugely expanding science system (Poland) from both temporal and cross-disciplinary perspectives. ...
... The steep productivity stratification of scientists has been examined in basic publications for both academic career studies and bibliometrics. Top performers have been termed star scientists (Abramo et al. 2009;Carrasco and Ruiz-Castillo 2014); stars, superstars, and star performers (Rosen 1981;Serenko et al. 2011;Aguinis and O'Boyle 2014;Agrawal et al. 2017;Sidiropoulos 2016); the best (O'Boyle and Aguinis 2012); the prolific (Fox and Nikivincze 2021) and prolific professors (Piro et. al 2016); top producing authors (Halevi et al. 2015) and hyperprolific authors (Ioannidis et al. 2018); as well as top researchers (Cortés et al. 2016), top performers (Abramo et al. 2011), and academic and scientific elites (Larivière et al. 2010;Parker et al. 2010). ...
... al 2016); top producing authors (Halevi et al. 2015) and hyperprolific authors (Ioannidis et al. 2018); as well as top researchers (Cortés et al. 2016), top performers (Abramo et al. 2011), and academic and scientific elites (Larivière et al. 2010;Parker et al. 2010). The classes of scientists examined in the high productivity literature have had a single attribute in common: They were all at the right end of the publishing productivity distribution within universities, disciplines, and countries and, in some cases, also cross-nationally (Agrawal et al. 2017;Rosen 1981). ...
In this research, the contribution of a highly productive minority of scientists to the national Polish research output over the past three decades (1992–2021) is explored. Four classes of top performers (the upper 1%, 3%, 5%, and 10%) are examined using four productivity measurements. A temporal stability of productivity patterns is found: the upper 1% of scientists, on average, account for 10% of the national output, and the upper 10% account for almost 50% of total output, with significant disciplinary variations. The 1/10 and the 10/50 rules consistently apply across the three decades studied. The Relative Presence Index (RPI) we constructed shows that men are over-represented in all top performers classes. Top performers are studied longitudinally through their detailed publishing histories, with micro-data coming from the raw Scopus dataset. Econometric models identify the three most important predictors changing the odds ratio estimates of membership in top performance classes: gender, academic age, and publishing patterns. The downward trend in fixed effects over successive six-year periods indicates increasing competition in academia. A large population of internationally visible Polish scientists (N=152,043) with their 587,558 articles is studied. Implications for high productivity studies are shown, and limitations are discussed.
... Para tanto, supõe-se que músicos com baixo nível de escolaridade podem aprimorar o seu talento e alcançar êxito em suas carreiras e, desse modo, os anos de estudo não acompanham linearmente o nível de renda auferido na música. Além disso, o campo de trabalho dos músicos tem sua distribuição de renda extremamente distorcida, com poucos indivíduos auferindo remunerações acima da média praticada (Rosen 1981). ...
... E, nesse quesito, tem-se por hipótese de que os retornos econômicos na trajetória de vida dos músicos não acompanham linearmente o nível de escolaridade, cabendo a análise das outras características observáveis que podem explicar os retornos pecuniários. As discrepâncias dos retornos pecuniários no universo artístico foram discutidas por Rosen (1981), ao detalhar a origem da concentração de renda em alguns poucos trabalhadores. Este fenômeno foi denominado como Economia dos Superstars. ...
... Nas reflexões de Rosen (1981), o olhar está direcionado justamente para o trabalho artístico na seguinte descrição: um indivíduo ao assistir várias apresentações de cantores medianos não obtém um retorno suficientemente satisfatório ao que teria se estivesse assistindo a uma única apresentação com desempenho de alto nível. Rosen (1981) ainda menciona outros segmentos ao usar o exemplo de médicos, uma vez que as pessoas estariam dispostas a pagar mais por maior precisão em seus serviços. ...
Resumo Uma das características marcantes no campo de trabalho artístico é o diferencial de rendimentos e suas desigualdades. Como o campo é muito heterogêneo, este artigo pretende verificar se os diferenciais e desigualdades retratados pela literatura ocorrem para os músicos atuantes em Belo Horizonte. Para tanto, nos meses de fevereiro, março e abril de 2020, foi realizada uma pesquisa para a coleta de dados primários a fim de responder estas questões, a partir da aplicação econométrica e estatística. As aplicações sugerem que a hipótese de não linearidade entre o nível de instrução e rendimentos não pode ser rejeitada, e as características pessoais não se mostraram significativas nesta análise. Em relação às desigualdades intragrupo, constata-se que os maiores índices ocorrem em alguns grupos específicos, como os de músicos com dedicação exclusiva, na faixa etária de 30 a 36 anos e graduados no ensino superior em música.
... Fortune's Global 500 data is an annual list of the largest 500 global (private and public) 115 Superstars have been the subject of economic studies for decades. Rosen (1981) wrote his article entitled 'The Economics of Superstars' already in the early 1980s, summarising the role of Superstars as follows, 'The phenomenon of Superstars, wherein relatively small numbers of people earn enormous amounts of money and dominate the activities in which they engage, seems to be increasingly important in the modern world.' 116 In this paper, Economic Profit = Invested capital*(Return on invested capital -weighted average cost of capital). 117 A main advantage of Fortune Global 500 is that the data (for firms covered) is consistent, comprehensive and, notably, goes back to 1995. ...
... Bessen (2022).154 Superstar effects in a narrow sense as identified byRosen (1981). ...
Competition between firms takes place in an evolving economic and policy environment. The present report seeks to assess how the conditions of competition have changed in the EU over the past 25 years and what may have been the main drivers of those changes. It also seeks to assess how effective or weak competition impacts competitiveness and overall economic growth in the EU. It draws on contributions from the OECD, a consortium of researchers led by Lear and by DG Competition itself.
... Indeed, previous research has described stars as emotional competent objects (Luo et al., 2010) and identified the key emotional drivers of their influence (Moraes et al., 2019). This emotional dimension explains the difficulties associated with determining the origins of stardom (Adler, 1985;Rosen, 1981), the so-called power of stars (Elberse, 2007). It is related to the experience good property of movies (Chang & Ki, 2005) which underlines the importance of the psychological approach (Eliashberg et al., 2006), that is, focusing on the individual moviegoer's decisions, when analyzing the success factors of movies (Hadida, 2009). ...
... One of these forces are the superstars that have been positioned as personalities with boxoffice power (King, 1987). The source of such power has raised a great interest in previous literature from the original explanations of Rosen (Rosen, 1981), Adler (Adler, 1985), Frank and Cook (Frank & Cook, 1995), and Borghans and Groot (Borghans & Groot, 1998) to more recent proposals of applied nature (Harashima, 2016). ...
... Ferreira and Nikolowa (2024) develop a theory to demonstrate that greater pay disparity represents a key feature of the optimal internal career paths in more prestigious financial firms. Studies also suggest that executives create synergies for reducing the marginal cost of effort for other employees, thus receiving higher pay compared to lower-level employees (Rosen, 1981(Rosen, , 1982. Moreover, relative pay in firms has labor market implications through effective employee sorting (Breza et al., 2018). ...
We examine how traditional Chinese culture interplays with pay disparity to affect employee productivity. In particular, we leverage an exogenous regulatory reform in Chinese state-owned enterprises (SOEs) to reduce vertical pay disparity (i.e., the difference between executive and average employee pay within a firm). Our results show that in a cultural context characterized by high levels of power distance and masculinity, a sudden reduction in vertical pay disparity is accompanied by a notable decline in employee productivity. Furthermore, the decline in productivity is more pronounced when employees are exposed to greater cultural traditionality. We also show that executive compensation declines after the Reform while employee pay stays unchanged. Importantly, our additional results show that neither managerial efficiency nor the departure of high-performing executives changed significantly after the Reform, and the performance effects of pay disparity are not primarily attributable to economic incentives for SOE executives or employees. Overall, our findings suggest that imposing pay restrictions without taking cultural context into account can have adverse effects on firm performance.
... To control for player talent, we rely on All-Star appearances; being an All-Star implies exceptional talent (Horowitz & Zappe, 1998;Idson & Kahane, 2000;Kahn, 1993a;Rosen, 1981). We differentiate more recent and earlier appearances, such that All-Star last3years measures the number of All-Star appearances in the most recent three seasons, and All-Star early captures All-Star appearances earlier, prior to the most recent three seasons, such that it implies more persistent star status. ...
This paper seeks to determine the financial costs of recent injuries and market expectations of players’ future attrition rates by investigating the impacts on free agent contract designs, as represented by the yearly salary and contract length. The empirical findings, derived from data about 698 free agent contracts in Major League Baseball between 2011 and 2018, indicate that injuries exert different impacts on salaries versus contract lengths. For example, free agents who recently injured an elbow or shoulder receive shorter contracts than those not injured in the previous season, but their salaries are not affected. Market expectations of player attrition in the upcoming season reduce both contract lengths and salaries. For players, these results reaffirm the importance of staying healthy and finding ways to signal the low likelihood of future injuries to ensure their remuneration. For managers, the results emphasize the need to track free agents’ health status carefully, especially to avoid a winner’s curse.
... Regarding the first configuration, building on the differentiation and conformity literatures just discussed, we theorize that despite the potential benefits of capitalizing on unsated demand provided by differentiation, a homogeneous cultural market in both dimensions is unlikely to spur innovation. In markets where the reception of novel products is highly uncertain (Bielby and Bielby 1994;Leahey, Beckman, and Stanko 2017), and the market holds outsized rewards for successes (Rosen 1981), the risk of illegitimacy and its consequences is simply too great (Hsu 2006a(Hsu , 2006bZuckerman and Kim 2003). We expect producers in such markets will play it safe and generally follow existing trends (see Figure 1a). ...
We offer a new perspective on how cultural markets are structured and the conditions under which innovations are more likely to emerge. We argue that in addition to organization- and producer-level factors, product features—the locus of marketplace interaction between producers and consumers—also structure markets. The aggregated distribution of product features helps producers gauge where to differentiate or conform and when consumers may be more receptive to the kind of novelty that spawns new genres, our measure of innovation. We test our arguments with a unique dataset comprising the nearly 25,000 songs that appeared on the Billboard Hot 100 chart from 1958 to 2016, using computational methods to capture and analyze the aesthetic (sonic) and semantic (lyrical) features of each song and, consequently, the market for popular music. Results reveal that new genres are more likely to appear following markets that can be characterized as diverse along one feature dimension while homogenous along the other. We then connect specific configurations of feature distributions to subsequent song novelty before linking the aesthetic and semantic novelty of individual songs to genre emergence. We replicate our findings using industry-wide data and conclude with implications for the study of markets and innovation.
... Indeed, digital/streaming consumption is rapidly overtaking in-person attendance consumption in professional sports as well as in several careers of students' interest. 13 As Rosen (1981) describes, this technology yields the economies of scale effect at the root of many of our students' productivity. Any of our students who produce intellectual property has the opportunity to create that property once and, in principle, sell an infinite number of (digital) copies at zero marginal cost using the same 'attendance multiplier' described in this elite athlete example. ...
... First, when the user has sensitive attributes that could potentially cause any form of disadvantage or poorer experience for them in the platform. Second, when partners do not have fair opportunity to be presented to users: partner diversity and visibility are intrinsically related to the healthiness of marketplaces, especially because they are acknowledged to suffer from "superstar economics" [37]. ...
Recommender Systems are especially challenging for marketplaces since they
must maximize user satisfaction while maintaining the healthiness and fairness of
such ecosystems. In this context, we observed a lack of resources to design, train,
and evaluate agents that learn from interaction logs of these production systems,
especially in the offline setting. For this matter, we propose the MArketplace
Recommender Systems Gym (MARS-Gym), an open-source framework to empower
researchers and engineers to quickly build and evaluate Reinforcement Learning
agents for recommendations in marketplaces. MARS-Gym addresses the whole
development pipeline: data processing, model design and offline training, and
multi-sided evaluation. We also provide the implementation of a diverse set of
baseline agents, with a metrics-driven analysis of them in the Trivago marketplace
dataset, to illustrate how to conduct a holistic assessment using the available metrics of recommendation, off-policy estimation, and fairness. With MARS-Gym, we
expect to bridge the gap between academic research and production systems, as
well as to facilitate the design of new algorithms and applications.
... Very little work has established how comedic talent emerges in different countries and for the very successful, whether Rosen (1981) or Adler (1985) best account for comedic superstars? Further notwithstanding the earlier psychological work considered economists might be well placed to re-examine by survey, natural or laboratory experiments whether gender matters in comedic production and to explore any gender disparity in numbers of comedians. ...
Despite being a globally significant form of art and culture, the performance of comedy has seemingly maintained a very low profile in cultural economics. The case for greater research scrutiny of this art form is advanced alongside some possible reasons for the relatively low academic attention devoted to comedy. The scope for considering comedy in economic terms is also considered, and a range of research questions are raised to stimulate debate and further enquiry on the topic.
... (At the time of writing, Christmas 2001, Harry Potter is everywhere, with Lord of the Rings waiting in the wings.) There is much research waiting to be done linking bounded rationality's role in the significance of easily recognizable brands and superstars (Rosen, 1981) to the managerial and industrial organization implications of the need to coordinate complementary activities aimed at capturing rents, quite often within short product life cycles. ...
Introduction Here we explore the underlying unity of two of the concepts that we have most employed from Herb Simon's work, namely bounded rationality and decomposability, and how this unity provides the starting point for merging cognitively focused approaches to behavioral economics with evolutionary/institutional economics into a coherent single framework. Our interest in merging these programs can be traced back particularly to the formative influence of Brian Loasby, who first began to wrestle with both of Herb's concepts in his 1976 book Choice, Complexity and Ignorance and then used George Kelly's 1963 A Theory of Personality to show just how much the cognitive strategies that people use for dealing with a complex world are dependent on that world's being at least partially decomposable. Once the two concepts were seen woven together at the level of the decision-maker's mind, it gradually became apparent that this had relevance for consumer theory, for corporate strategy, and for public policy, and that institutions could be seen as devices for handling bounded rationality by partitioning the world into separable units. In the process of extending this line of thinking, we have increasingly moved from a cognitive focus to a focus on structural evolution in which the path taken by economic systems becomes seen as being shaped by increasing decomposition in some areas and by increasing interconnectedness in other areas, the changing mix of which affects the ability of decision makers to manage the system and its flexibility in the face of shocks. To solve problems, hybridization of modular elements is commonly employed, adding to the menu of elements on which further creative destruction may be founded. To explore the unity of these key concepts, and to illustrate the workings of a process of creative hybridization, we adopt a rather reflexive, and reflective, strategy, showing how our ideas developed with a blinkered focus on particular areas of the economic system considered separately before evolving a general system for making sense of the whole. It will become apparent that this is not simply our story of how Herb's work opened up a lifetime of research opportunities for us, but also a reflection of Herb's influence on Neil Kay, whose own Simon-inspired work has been a major ingredient of our research program.
... La valoración de mercado de los jugadores, así como sus perspectivas de desarrollo profesional, fuertemente condicionada por las oportunidades de jugar que se les ofrezcan, entronca con otras cuestiones, como el estatus de las superestrellas del deporte (Rosen, 1981) o la vinculación con iconos del deporte y la inversión de desarrollo de marca (Pawlowski y Anders, 2012). La inversión en talento es ciertamente crucial, pues los clubs procuran contratar a jugadores que gocen del estatus de estrella, y sirvan como reclamo para los aficionados. ...
El presente estudio se enmarca en el contexto de la industria de espectáculos deportivos, partedel sector del entretenimiento. El talento deportivo, así como la visibilidad mediática que otorgadicho talento, son activos valiosos y a menudo no replicables, que explotan los clubs de fútbol.En este artículo, de naturaleza empírica, usamos una amplia base de datos de futbolistasde las cinco grandes ligas domésticas de Europa, abarcando de la temporada 2014/2015a la 2018/2019, ambas incluidas. Los resultados permiten corroborar – en sintonía contrabajos precedentes – que los jugadores con mayor capacidad de atraer la atención de losmedios gozan de mayor valor de mercado y reciben más oportunidades de jugar, indicandoque los entrenadores valoran no sólo el rendimiento deportivo, sino también las implicacionesmediáticas y económicas.Entre los resultados, se constata que existe un subempleo sistemático de talento en la industriade espectáculos futbolísticos, en tanto en cuanto las restricciones del sistema competitivo,que limitan el número de jugadores y cambios por partido, impiden dar oportunidades de jugara algunos de los jugadores; situación que se acrecienta al concentrar demasiado talento en lamisma plantilla, con lo que se merma la capacidad global de proporcionar espectáculo.
... The labor market for artists differs in many ways from other labor markets, which has important implications for the career choices of college graduates with majors in the arts. Theoretical models of the labor market for artists characterize artists as being intrinsically motivated to create art (Throsby, 1994), and the nature of artistic output is such that "superstars" can arise (Adler, 1985;Rosen, 1981), along with oversupply of non-superstars earning very little. Empirical research on artists finds high levels of self-employment (Woronkowicz & Noonan, 2019), short-term project-based work (Bridgstock, 2005), and multiple jobholding (Alper & Wassall, 2000). ...
In this study, we test for the impact of the Affordable Care Act’s dependent coverage expansion on the career choices of young college graduates with majors in the arts in the United States. Since working as an artist often involves employment arrangements like self-employment and project-based work that lack health insurance coverage, policies that expand access to health insurance have the potential to make employment in the arts more attractive for arts graduates. Using American Community Survey data, we use a difference-in-differences regression approach comparing the likelihood of working in the arts for college graduates with majors in the arts who are just under- and just over-26, pre- and post-implementation of the ACA’s dependent coverage expansion. We find that the ACA increased the likelihood that arts graduates under 26 years of age were working in the arts by over 2% points, effects that are statistically significant and large as less than 20% of arts graduates in our sample work in the arts. Such changes are not observed for other graduates, suggesting that this response is unique to arts graduates, who are often found to behave differently than other workers.
... We find stark differences between the age-wage and age-productivity profiles in MLS; while productivity tends to peak at the age of 26 (approximately the middle of a footballer's career), wages continue to increase into the early 30s (towards the end of their career). The richness of 1 Due to this unique setting and data availability, MLS has been used previously to test theories of the labour market, for example: Coates et al. (2016) found a negative relationship between within-firm wage inequality and firm performance; Scarfe et al. (2020) showed that a team's success on the pitch tends to correlate with consistently paying a relatively low price for talent; Scarfe et al. (2021) tested whether the productivity or popularity based theories of Rosen (1981) and Adler (1985), respectively, could best account for the superstar wages of top earners; and Butler and Coates (2022) showed that MLS goalkeepers generally receive a wage penalty, and outfield players who can perform multiple roles receive a premium. ...
There is an inverted u‐shaped relationship between age and wages in most labor markets, but the effects of age on productivity are often unclear. We use panel data in a market of high earners, professional footballers (soccer players) in North America, to estimate age‐productivity and age‐wage profiles. We find stark differences; wages increase for several years after productivity has peaked, before dropping sharply at the end of a career. This poses the question: why are middle‐aged workers seemingly overpaid? We investigate a range of possible mechanisms that could be responsible, only finding evidence that tentatively supports a talent discovery theory.
... The literature on superstars, starting with Rosen (1981) and Frank and Cook (1995), shows that retailers prefer producing a limited number of superstars. This can be explained in terms of both supply and demand. ...
The long-tail effect, in which online retailing has a relative advantage in selling less popular products, has been studied extensively with e-commerce growth. However, recent research has raised questions that are more nuanced than originally considered. E-commerce can lead to customer demand concentration under specific conditions such as recommendations of popular products and past-purchase shortcuts. This study explores customer demand concentration in multichannel grocery retailing, a product category that involves low search costs. We use multichannel and multichain purchase panel data, which are representative of a large portion of online supermarkets in Japan. Our analysis shows that, compared with demand in physical stores, demand online is more concentrated on popular products. Furthermore, online shopping experience has a moderating effect, resulting in greater demand concentration among more experienced customers. These results are robust when controlling for available assortments across channels. These findings help retailers to develop inventory and customer relationship management.
... Consumers perceive these videos as popular; they can share and talk about it. There are different popularity indicators; the most common ones are views, followers, likes, and 1 Within the discussion of economics of superstars, first introduced by Rosen (1981), the aspect of talent is of concern. However, objective measures of talent have proven to be a considerable challenge in empirics (Franck & Nüesch, 2012;Krueger, 2005). ...
Social media stars gain star‐status with uploads on social media pages like YouTube, TikTok, or Instagram. One of the most popular platforms is “Instagram” owned by Meta/Facebook. The growing social, cultural, and economic power of so‐called influencers raises questions about key drivers of success and, moreover, distribution of income on social media platforms. Instagram has been accused of strategically favoring images with nude content. In order to shed light on this socio‐critical aspect, this paper examines the following research questions: Does body exposure drive income success on Instagram? Is there a difference between male and female content in this regard? This paper empirically analyzes 500 top Instagram stars within the categories (1) fashion and beauty, (2) fitness and sports, (3) music, (4) photo and arts, and (5) food and vegan. The data provide information on popularity, posting behavior, and price estimates per post. Using hybrid regression models, the results show indeed positive impact of body exposure on monetary success. Accounts with high level of body exposure achieve higher prices and advertising revenues than accounts with less nudity, regardless of the gender. Regarding gender differences, male content achieves on average higher advertising prices, whereas female accounts provide more branded content and eventually achieve higher advertising revenues.
We estimate the superstar effects in Major League Baseball, focusing on a particularly unique international athlete, Shohei Ohtani, using a fixed effects panel regression with multiway clustering. Ohtani’s scarce talent as both a pitcher and a hitter provides the potential to have outsized influence on demand at home (superstar effect) and away (superstar externality) games, providing new marketing opportunities for the league. We compare Ohtani’s impact on attendance with other top pitchers, particularly after large attendance drops attributed to the COVID-19 pandemic, suggesting that his superstardom played a key role in bringing fans back to baseball games. Results revealed a large attendance externality, especially after the pandemic, that increased away attendance by up to 40% in 2021 specifically (and up to 20% overall). We propose that Ohtani provides an opportunity for Major League Baseball to leverage a recognizable face of baseball and leverage superstar value that was previously shown to be in decline.
Although e-commerce is relatively new, it has been the cornerstone of international trade in the modern world. Broadly, e-commerce can be described as the process of buying, selling or exchanging any kinds of products, services and information via electronic channels. The economy is one of the areas directly affected by e-commerce, and as a result of this significant impact, the concept of the digital economy has emerged. It is complicated to define the concept of the digital economy as it continues to expand in scope day by day; however, its impact can broadly be experienced in many different fields. To set an example, the occurrence of the digital economy has already caused many significant changes in many areas, such as the examination of competition issues in the markets. It has significant effects on current EU competition law understanding, and it is evident that it will continue to form future prosperity. Therefore, this article aims to explain the general dynamics of the digital economy and digital markets as an important issue being discussed in EU competition law.
This study examines market concentration's influence on popular music. The data cover popular music from weekly Billboard Hot 100 songs from 1952 to 1989, for which song characteristic data including tempo and duration is available from the Million Song Dataset (MSD). Greater market concentration of the top four artists is found to impact song length, with longer #1 songs and shorter songs in the #2 through #10 spots on the Billboard charts. However, tests for alterations in song construction by top artists that might indicate a form of “sell‐out” behavior do not reveal evidence of it.
This article proposes a reassessment of the concept of talent and offers tools for a conceptual and methodological shift in the study of talent identification in sports. Drawing on American pragmatism, specifically the pragmatic maxim, the article aims to clarify the concept of talent in talent identification that makes an athlete open for selection. The article organizes, presents, and discusses existing research on talent identification and highlights the need for a conceptual reevaluation. Instead of solely focusing on talent identification, the article suggests studying player qualifications through explicit and implicit tests, where the label "talent" is one outcome among several. The relevance of measurement, attachment, and judgment in this context of valuation is discussed. The article underscores the importance of considering the involved agents and the situational and historical context of these qualifications.
Subscription-based crowdfunding platforms emerged as novel digital platforms that offer creators the possibility of financial independence. They differ significantly from traditional time-limited crowdfunding approaches by utilizing recurring payments and enabling a creator-centric rather than campaign-centric funding approach. We built upon previous research on individuals’ motivation to support crowdfunding campaigns, and utilizing self-determination theory, our study explores which subscription-based crowdfunding campaign characteristics influence individuals’ motivation to support them. We use a two-method approach by analyzing individual pledge data from a subscription-based crowdfunding platform and conducting a discrete choice experiment. Our results show that having a high number of previous supporters increases potential supporters’ willingness to pay, while a campaign’s current recurring income and the hiding of this piece of information decrease it. We could also identify a u-shaped effect of campaigns’ goal proximity on willingness to pay. We discuss the theoretical and practical contributions of our research and provide an overview of potential future research directions.
This article presents, from an institutional perspective, the vulnerability faced by many agents of the art world and its market. We defend that this vulnerability is due to two key factors. The first one, is the uncertainty regarding what is art. The second one, is the Cash Reserve Ratio with low reserve requirements. As stated in this article, money is a useful mechanism to reduce the uncertainty. Nevertheless, the Cash Reserve Ratio with low reserve requirements is not sustainable and ends in economic precariousness. The approach of this article is theoretical, and presents conclusions in a cogent and generalized form. The main conclusion of this text is that an economic system sustained in monetary units linked to standard resources could decrease the agents within the art world and its market. Nevertheless, those agents could develop their activity in a more optimal situation.
How do innovation and education policy affect individual career choices and aggregate productivity? This paper analyzes the effect of R&D subsidies and higher education policy on productivity growth through the supply of innovative talent. We put scarce talent, higher education attainment, and career choice at the center of a new endogenous growth framework with individual-level heterogeneity in talent, financial resources, and preferences. We link the model to micro-level data from Denmark on the backgrounds of who obtains a PhD and becomes an inventor and the outcomes of a set of policy interventions. We find that R&D subsidies can be strengthened when combined with higher education subsidies, which enable talented but poor youth to pursue a career in research. Education and innovation policies not only alleviate different frictions, but also impact innovation at different time horizons. Education policy is more effective in societies with higher income inequality.
Forecasting the popularity of new songs has become a standard practice in the music industry and provides a comparative advantage for those that do it well. Considerable efforts were put into machine learning prediction models for that purpose. It is known that in these models, relevant predictive parameters include intrinsic lyrical and acoustic characteristics, extrinsic factors (e.g., publisher influence and support), and the previous popularity of the artists. Much less attention was given to the social components of the spreading of song popularity. Recently, evidence for musical homophily—the tendency that people who are socially linked also share musical tastes—was reported. Here we determine how musical homophily can be used to predict song popularity. The study is based on an extensive dataset from the last.fm online music platform from which we can extract social links between listeners and their listening patterns. To quantify the importance of networks in the spreading of songs that eventually determines their popularity, we use musical homophily to design a predictive influence parameter and show that its inclusion in state-of-the-art machine learning models enhances predictions of song popularity. The influence parameter improves the prediction precision (TP/(TP +\documentclass[12pt]{minimal} \usepackage{amsmath} \usepackage{wasysym} \usepackage{amsfonts} \usepackage{amssymb} \usepackage{amsbsy} \usepackage{mathrsfs} \usepackage{upgreek} \setlength{\oddsidemargin}{-69pt} \begin{document}$$+$$\end{document} FP)) by about 50% from 0.14 to 0.21, indicating that the social component in the spreading of music plays at least as significant a role as the artist’s popularity or the impact of the genre.
Online labor platforms have been criticized for fueling precarious working conditions. Due to their platform-bound reputation systems, switching costs are prohibitively high and workers are locked-in to the platforms. One widely discussed approach to addressing this issue and improving workers’ position is the portability of reputational data. In this study, we conduct an online experiment with 239 participants to test the effect of introducing reputation portability and to study the demand effect of imported ratings. We find that the volume of imported ratings stimulates demand, although to a lower degree than onsite ratings. Specifically, the effect of imported ratings corresponds to about 35% of the effect of onsite ratings. The results imply the possibility of unintended cross-market demand concentration effects that especially favor workers with high rating volumes (“superstars”).
The emergence of Artificial Intelligence (AI) has profound implications for intellectual property (IP) frameworks. While much of the discussion so far has focused on the legal implications, we focus on the economic dimension. We dissect AI's role as both a facilitator and disruptor of innovation and creativity. Recalling economic principles and reviewing relevant literature, we explore the evolving landscape of AI innovation incentives and the challenges it poses to existing IP frameworks. From patentability dilemmas to copyright conundrums, we find that there is a delicate balance between fostering innovation and safeguarding societal interests amidst rapid technological progress. We also point to areas where future economic research could offer valuable insights to policymakers.
Sport has become omnipresent in our daily lives, which justifies a critical analysis of the socio-economic stakes it represents: are football players paid too much? How much do the Olympic Games cost? Is European football bankrupt? Is sport good for your health? Are we running out of volunteers? Is professional sport rigged? Beyond its economic dimension, it is essential to improve the consideration of the social dimension of sport, whose total value goes far beyond its market value. As the traditional instruments of orthodox economic calculation are ill-suited, a socio-economic analysis of sport is needed. In 8 chapters and 43 short articles, this book offers a synthesis of knowledge with a presentation of the problems and controversies raised, also referring to numerous examples from field studies.
Covering the bulk of economic activity in ten developed countries over 1982–2005, this paper is the first to study the distinct effects of Information Technologies (IT) and Communication Technologies (CT) on labor, and in particular, the relative demand for different education groups of workers. Consistent with evidence on automation‐induced job and skill polarization, IT capital intensity decreased the demand for the middle‐educated relative to the highly and low‐educated. Instead, CT capital intensity increased the demand for the highly educated relative to the low‐educated, suggesting that CT facilitate the leverage of knowledge by the former group in production teams or the identification of new investment opportunities for their companies. Additional evidence, especially on the effects of CT, yields a richer set of insights.
The need to implement home-office after the COVID-19 pandemic impacts the flow of knowledge transmitted within an organization. As companies restructure their hierarchies to ensure the best use of the time of their managers, impactful changes in the job markets will follow. Using a general equilibrium approach, we predict that an increase in internal communication costs generates a fall in the economy’s wealth, a decline in the dispersion of wages and also of managers’ compensations, but an increase in overall inequality. Moreover, we predict that the new configuration of the economy will feature more firms, but of smaller size.
