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Profitability trends in Hollywood, 1929 to 1999: somebody must know something 1
Author(s) -
POKORNY MICHAEL,
SEDGWICK JOHN
Publication year - 2010
Publication title -
the economic history review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.014
H-Index - 49
eISSN - 1468-0289
pISSN - 0013-0117
DOI - 10.1111/j.1468-0289.2009.00488.x
Subject(s) - profitability index , hollywood , production (economics) , investment (military) , portfolio , film industry , studio , rate of return , business , economics , commerce , finance , movie theater , engineering , macroeconomics , art , art history , political science , politics , law , telecommunications
This article presents an overview of the development of the US film industry from 1929 to 1999. Notwithstanding a volatile film production environment, in terms of rate of return and market share variability, the industry has remained relatively stable and profitable. Film production by the film studios is interpreted as analogous to the construction of an investment portfolio, whereby producers diversified risk across budgetary categories. In the 1930s, high‐budget film production was relatively unprofitable, but the industry adjusted to the steep decline in film‐going in the postwar period by refining high‐budget production as the focus for profitability.