Seasonality in the U.S. motion picture industry

The observed seasonality of box-office revenues reflects both seasonality in underlying demand for movies and seasonality in the number and quality of available movies. I separately identify these aspects by estimating weekly demand for movies, using movie fixed effects, a long panel of movies' weekly revenues, and restrictions on their decay pattern. I find that the estimated seasonality in underlying demand is much smaller and slightly different from the observed seasonality of sales. The biggest movies are released at times when demand is highest, amplifying the underlying seasonality. Price rigidities in the industry may facilitate this amplification effect.