Media Economics: Applying Economics to New and Traditional Media differs from ordinary media economic texts by taking a conceptual approach to economic issues. As the book progresses through economic principles, authors Colin Hoskins, Stuart McFadyen, and Adam Finn use cases and examples to demonstrate how these principles can be used to analyze media issues and problems. Media Economics emphasizes economic concepts that have distinct application within media industries, including corporate media strategies and mergers, public policy within media industries, how industry structure and changing technologies affect the conduct and performance of media industries, and why the United States dominates trade in information and entertainment.  


After studying this chapter, you should be able to answer the following questions: What are the three different views on the role of advertising in a market economy? How important is advertising to the economy? How did a decrease in the subscriber price for The Times affect the price the newspaper charged for advertising space, and why? How do demographics and consumer interests affect the price of advertising? Why is the last question relevant to any leading U.S. consumer magazine contemplating a decrease in subscription price? How does a reliance on advertising revenue influence media firms’ choices with respect to the information and entertainment content offered to consumers?

Advertising shares many of the characteristics of mass media communication—harnessing creativity to create messages that will achieve ...

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