Causal Analysis of Screen Adaptation Release and Demand for Fiction Books

Since previous studies have come to opposing conclusions, which is explained by the specific features of the investigated markets. This article aims to provide evidence of the causal impact of book-based movies’ release on book demand in the Russian market. To this end, the survey to determine the market structure is conducted. Furthermore, the work uses annual data on the book sales of one book retail chain of Russia and information about the movie releases during the studied period. The switching equations model with endogenous switching allows estimating the decision of motion picture industries whether to adopt book or not and the demand on books simultaneously. As the producers rely on the ratings and number of people who have left their scores on the site, it is shown that books’ popularity is important for movie industries to make the decision. Withal the results indicate that the presence of movie adaptation stimulates the book sales revenue. And those books that movie producers have refused to adopt have worse performance. Moreover, the present study indicates book quality characteristics that drive the book demand. Therefore, these results can be used by the purchasing managers of the book retail chain to solve practical problems.