How does advertising affect market performance? A note on generic advertising

Stephen F. Hamilton, Timothy Richards, Kyle W. Stiegert

Research output: Contribution to journalArticle

6 Citations (Scopus)

Abstract

We propose a novel approach to estimating the effect of advertising on market performance that relies on the preferences of firms participating in generic advertising programs. Generic advertising campaigns provide a unique window to observe advertising effects on market performance, because rotations in market demand systematically redistribute advertising rents among firms according to observable characteristics on producer size. We examine producer attitudes towards generic advertising in the "Beef. It's What's for Dinner!" campaign of the U.S. Beef Checkoff program, the subject of the recent and controversial Supreme Court ruling on generic advertising as a form of government speech. We find the likelihood producers favor an expansion of the advertising program increases in their operating scale. This finding is consistent with an advertising campaign that has led to a counterclockwise rotation of market demand and a commensurate increase in market performance in the U.S. beef market. (JEL L1, M37, Q13)

Original languageEnglish (US)
Pages (from-to)1183-1195
Number of pages13
JournalEconomic Inquiry
Volume51
Issue number2
DOIs
StatePublished - Apr 2013

Fingerprint

Generic advertising
Market performance
Beef
Advertising campaign
Market demand
Advertising effects
Supreme Court
Rent
Government

ASJC Scopus subject areas

  • Economics and Econometrics
  • Business, Management and Accounting(all)

Cite this

How does advertising affect market performance? A note on generic advertising. / Hamilton, Stephen F.; Richards, Timothy; Stiegert, Kyle W.

In: Economic Inquiry, Vol. 51, No. 2, 04.2013, p. 1183-1195.

Research output: Contribution to journalArticle

Hamilton, Stephen F. ; Richards, Timothy ; Stiegert, Kyle W. / How does advertising affect market performance? A note on generic advertising. In: Economic Inquiry. 2013 ; Vol. 51, No. 2. pp. 1183-1195.
@article{5e5a93bb351d4e028f6d8f9d09ac092e,
title = "How does advertising affect market performance? A note on generic advertising",
abstract = "We propose a novel approach to estimating the effect of advertising on market performance that relies on the preferences of firms participating in generic advertising programs. Generic advertising campaigns provide a unique window to observe advertising effects on market performance, because rotations in market demand systematically redistribute advertising rents among firms according to observable characteristics on producer size. We examine producer attitudes towards generic advertising in the {"}Beef. It's What's for Dinner!{"} campaign of the U.S. Beef Checkoff program, the subject of the recent and controversial Supreme Court ruling on generic advertising as a form of government speech. We find the likelihood producers favor an expansion of the advertising program increases in their operating scale. This finding is consistent with an advertising campaign that has led to a counterclockwise rotation of market demand and a commensurate increase in market performance in the U.S. beef market. (JEL L1, M37, Q13)",
author = "Hamilton, {Stephen F.} and Timothy Richards and Stiegert, {Kyle W.}",
year = "2013",
month = "4",
doi = "10.1111/j.1465-7295.2011.00405.x",
language = "English (US)",
volume = "51",
pages = "1183--1195",
journal = "Economic Inquiry",
issn = "0095-2583",
publisher = "Wiley-Blackwell",
number = "2",

}

TY - JOUR

T1 - How does advertising affect market performance? A note on generic advertising

AU - Hamilton, Stephen F.

AU - Richards, Timothy

AU - Stiegert, Kyle W.

PY - 2013/4

Y1 - 2013/4

N2 - We propose a novel approach to estimating the effect of advertising on market performance that relies on the preferences of firms participating in generic advertising programs. Generic advertising campaigns provide a unique window to observe advertising effects on market performance, because rotations in market demand systematically redistribute advertising rents among firms according to observable characteristics on producer size. We examine producer attitudes towards generic advertising in the "Beef. It's What's for Dinner!" campaign of the U.S. Beef Checkoff program, the subject of the recent and controversial Supreme Court ruling on generic advertising as a form of government speech. We find the likelihood producers favor an expansion of the advertising program increases in their operating scale. This finding is consistent with an advertising campaign that has led to a counterclockwise rotation of market demand and a commensurate increase in market performance in the U.S. beef market. (JEL L1, M37, Q13)

AB - We propose a novel approach to estimating the effect of advertising on market performance that relies on the preferences of firms participating in generic advertising programs. Generic advertising campaigns provide a unique window to observe advertising effects on market performance, because rotations in market demand systematically redistribute advertising rents among firms according to observable characteristics on producer size. We examine producer attitudes towards generic advertising in the "Beef. It's What's for Dinner!" campaign of the U.S. Beef Checkoff program, the subject of the recent and controversial Supreme Court ruling on generic advertising as a form of government speech. We find the likelihood producers favor an expansion of the advertising program increases in their operating scale. This finding is consistent with an advertising campaign that has led to a counterclockwise rotation of market demand and a commensurate increase in market performance in the U.S. beef market. (JEL L1, M37, Q13)

UR - http://www.scopus.com/inward/record.url?scp=84874392673&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84874392673&partnerID=8YFLogxK

U2 - 10.1111/j.1465-7295.2011.00405.x

DO - 10.1111/j.1465-7295.2011.00405.x

M3 - Article

AN - SCOPUS:84874392673

VL - 51

SP - 1183

EP - 1195

JO - Economic Inquiry

JF - Economic Inquiry

SN - 0095-2583

IS - 2

ER -