Subsidies and awards in movie production

Abstract

This article analyses the effect of subsidies and awards on the Spanish motion picture industry. We estimate a Cobb–Douglas production function using regional data and show that Spanish motion picture industry exhibits constant returns to scale and that awards positively affect movie production whereas subsidies have no effect. In fact, awards affect the productivity of the sector as they allow for an increase in the output, which is not explained by an increase in inputs.

Acknowledgements

The authors gratefully acknowledge financial support from the Spanish Ministry of Education and Science and the Junta de Andalucia through Projects SEJ2007-62081/ECON and SEJ-2547, respectively.

Notes

¹We assume the middle point of each range of years of schooling, which are assumed to be constant over time.

²The cultural sector includes employees in museums, theatres, cinema (both exhibition and production), radio, television, etc.

³We assume that this proportion remains constant across regions.