Premium Essay

Hollywood Film

In: Business and Management

Submitted By rabbya
Words 1758
Pages 8
Introduction
Our analysis of Hollywood film industry show us the industry as an oligopoly and we decided to analyse its characteristics through the “structure conduct performance of this industry” (SCP)
Industrial concentration has been a concern for economics studies, while analysing Hollywood film industry we found a significant amounts of concentration with the largest companies that give them an amount of monopoly power that they use on its benefit preventing new comers, the power is use as a barrier to entry the market is often exercised in ways that harm the all industry.
Measures of concentration are important for the analysis of imperfect competition brought by monopolistic markets, and governments use them when are considering antitrust policies and companies merging. These measures provide an indication of the ability of the largest firms to control prices and competition.
Monopolies have the advantages of lowering production costs economic of scales and profit maximisations setting mark ups prices that can be one of the reason for unequal market competition and in not much benefit for consumers.
Although concentration is problematic in the industry it represent special problem in the movies business because, the big screen operates not only in the market of goods and services but also as ideological diversify market newer and fresher ideas can coming at any time. Brainwashed and manipulation can arise as a consequence of a significant monopoly power diminishing peoples viewpoint of life.
Concentration refers to the “degree of the market share enjoyed by the largest firms in an industry”. Usually economist measured this type of concentration by observing the market data, ratios, revenues, profits or assets and compared it with the industry as a whole.
The measures that we include in our analysis are the ratios CR4, CR6 and CR8, Herfindahl,…...

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