Chapter 11- Tying Case. Popcorn in movie theatres Why does popcorn cost so much at the movies? Theatres optimally choose to shift profits from admission tickets to concessions because they can meter the surplus extracted from a customer by how much of the aftermarket good they demand If true, positive correlation between willingness to pay for movies and demand for concessions Hartmann and Gil(2008)confirms this conjecture by analysing a data set with approximately 5 years of weekly attendance, box office revenue and concession revenue for a chain of 43 Spanish movie theatres e Wen Cao© Wen Cao 8 Case. Popcorn in movie theatres • Why does popcorn cost so much at the movies? • Theatres optimally choose to shift profits from admission tickets to concessions because they can ‘meter’ the surplus extracted from a customer by how much of the aftermarket good they demand. •If true, positive correlation between willingness to pay for movies and demand for concessions. • Hartmann and Gil (2008) confirms this conjecture by analysing a data set with approximately 5 years of weekly attendance, box office revenue and concession revenue for a chain of 43 Spanish movie theatres. Case. Popcorn in movie theatres • Why does popcorn cost so much at the movies? • Theatres optimally choose to shift profits from admission tickets to concessions because they can ‘meter’ the surplus extracted from a customer by how much of the aftermarket good they demand. •If true, positive correlation between willingness to pay for movies and demand for concessions. • Hartmann and Gil (2008) confirms this conjecture by analysing a data set with approximately 5 years of weekly attendance, box office revenue and concession revenue for a chain of 43 Spanish movie theatres. Chapter 11 - Tying