Close, But No Cigar

Abstract

This article examines the economic effects of prizes with implications for the diversity of market positions, especially in cultural fields. Many prizes have three notable features that together yield an emergent reward structure: (1) consumers treat prizes as judgment devices when making purchase decisions, (2) prizes introduce sharp discontinuities between winners and also-rans, and (3) appealing to prize juries requires costly sacrifices of mass audience appeal. When all three conditions obtain, winning a prize is valuable, but seeking it is costly, so trying and failing yields the worst outcome—a logic we characterize as a Tullock lottery. We test the model with analyses of Oscar nominations and Hollywood films from 1985 through 2009. We create an innovative measure of prize-seeking, or “Oscar appeal,” on the basis of similarity to recent nominees in terms of such things as genre, plot keywords, and release date. We then show that Oscar appeal has no effect on profitability. However, this zero-order relationship conceals that returns to strong Oscar appeals are bimodal, with super-normal returns for nominees and large losses for snubs. We then argue that the effect of judgment devices on fields depends on how they structure and refract information.

‘You won’t See Anyone Promoting a Bronze’: Awards and Ambivalence Amongst Craft Gin Producers

“…Here, Chris positions such competitions as akin to a lottery, a concept well explored by both English (2009) and the likes of Rossman and Schilke (2014). However, unlike awards in other sectors where a novelist, artist or filmmaker would submit entirely new works for consideration in subsequent years, here it is likely that gin producers enter their core product on an annual basis.…”

Does the Middle Conform or Compete? Risk and Quality Thresholds Predict the Locus of Innovation

“…Because producers can be complex and difficult to evaluate (Zuckerman 1999;Hannan, Pólos, and Carroll 2007;Vergne and Wry 2014), audiences create mechanisms to simplify their decisions. These mechanisms can take the form of category schemes (Zuckerman 1999), more formal rating systems (Kovács and Hannan 2015;Rao, Monin, and Durand 2005), status distinctions (Podolny 1993;Gould 2002), or best-of-breed awards (Rossman and Schilke 2014). Such mechanisms serve to simplify an audience member's evaluation and selection of particular producers by distilling their hardto-discern quality or qualities into a discrete evaluation (March and Simon 1958;H. R. Greve 2003b)-is this particular producer one of the good ones or one of the bad ones?…”

“…Kovács and Hannan 2015;Rao, Monin, and Durand 2005), rankings (e.g. Sauder and Espeland 2009), awards (Rossman and Schilke 2014;Kaniel and Parham 2017), intermediaries (Zuckerman 1999), status distinctions (Podolny 1993;Podolny 2001;Gould 2002), or implicitly understood categorizations (Zuckerman 1999;Hsu 2006b;Hannan, Pólos, and Carroll 2007). Such institutions create sharp distinctions in the perceived quality of otherwise similar producers and can generate discontinuities in the rewards they receive from the audience.…”

“…Such institutions create sharp distinctions in the perceived quality of otherwise similar producers and can generate discontinuities in the rewards they receive from the audience. Oscar awards, for instance, produce sharp differences between winners and also-rans (Rossman and Schilke 2014); mutual fund tier lists drive investment into the highlighted funds (Kaniel and Parham 2017); even otherwise continuous school rankings generate discontinuities for colleges that make it "above the fold" (Bowman and Bastedo 2009). In effect, such institutions act as quality thresholds that producers must meet in order to participate fully in a market.…”

“…Otherwise, innovation patterns are robust to changes to the actor decision process, the shape of the risk distribution (i.e. skewness or bimodality, c.f Eliashberg, Elberse, and Leenders 2006;Rossman and Schilke 2014),. or to more imprecise thresholds.…”