Factors affecting the financial success of motion pictures: what is the role of star power?

Geethanjali Selvaretnam, Jen-Yuan Yang

    Research output: Working paperDiscussion paper

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    Abstract

    In the mid-1940s, American film industry was on its way up to its golden era as studios started mass-producing iconic feature films. The escalating increase in popularity of Hollywood stars was actively suggested for its direct links to box office success by academics. Using data collected in 2007, this paper carries out an empirical investigation on how different factors, including star power, affect the revenue of ‘home-run’ movies in Hollywood. Due to the subjective nature of star power, two different approaches were used: (1) number of nominations and wins of Academy Awards by the key players, and (2) average lifetime gross revenue of films involving the key players preceding the sample year. It is found that number of Academy awards nominations and wins was not statistically significant in generating box office revenue, whereas star power based on the second approach was statistically significant. Other significant factors were critics’ reviews, screen coverage and top distributor, while number of Academy awards, MPAA-rating, seasonality, being a sequel and popular genre were not statistically significant.
    Original languageEnglish
    PublisherUniversity of St Andrews
    Pages1-25
    Number of pages25
    Publication statusPublished - 12 Jan 2015

    Publication series

    NameSchool of Economics & Finance Discussion Paper
    PublisherUniversity of St Andrews
    No.1501
    ISSN (Print)0962-4031
    ISSN (Electronic)2055-303X

    Keywords

    • star power
    • motion picture industry
    • box-office earnings
    • academy awards

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