The Counterfactual Analysis Of Star Power

The cultural industry has become an important part of Chinese economy.The 13th five-year plan clearly states that cultural industry will become a pillar industry of the national economy by 2020.As a relatively mature industry with an early start,the film industry has a leading exemplary role.Under the guidance of industrial policies,Chinese film industry has developed rapidly,with the box office revenue exceeding 60 billion yuan in 2018.Behind the prosperity,there are also problems such as high pay,tax evasion and failure to swell box office via celebrities with huge followers.How can stars influence the box office?Is star power or the other qualities of a movie more important?I have sorted out domestic and foreign literatures on star effect and film box office in detail,and built the indexes for star power from two pespectives:commercial and artistic value.Based on the sample of 1402 domestic films released in the mainland market from July 2011 to December 2018,Blinder-Oaxaca counterfactual decomposition,its counterfactual quantile regression and Propensity Score Matching method are used to distinguish the influence of stars and other film characteristics on the number of opening day screens,opening day box office and total box office of films with different sizes.The empirical results show that,on average,the opening day screens of the star films will be around 10,000-20,000more than that of non-star films;the opening day box office will be around 8-12 million more than that of the non-star films;and the total box office will be around 60-80 million more than that of non-star films.For small size films,choosing the right stars will play a significant role in promoting and improving box office.However,the star effect also has the feature of diminishing marginal utility.With the expansion of the film size,the effect of star power decreases and the importance of other film characteristics gradually increases.For big-budget movies,relying solely on star or over-using stars can even hurt the box office.For films with high costs,high expectations and high number of opening day screenings,it is better to polish the script carefully and look for more suitable leading actors with first-class acting skills rather than invite popular stars with high salaries.As industry norms become more sophisticated and capital operations become more mature,works with reputation will surely play an increasingly vital role.