Do Bubble Behaviors Exist in Chinese Film Stocks?

Abstract

This article investigates bubbles in the Chinese film industry to reveal the industry’s boom and bust process that influences employment, citizen’s livelihoods, and even economic growth. We adopt the film stock index to reflect the industry’s trajectory and employ the generalized and backward sup augmented Dickey–Fuller tests to detect bubble periods. Empirical results indicate that there are three positive bubbles in 2007, 2013, and 2015, indicating that the film market continues to expand after temporary frustrations. Meanwhile, one negative bubble is found in 2019, which demonstrates that the bubble’s negative impacts persist and the film industry is still having problems such as declining industrial output. Economic growth, film quality, and industrial policies are common factors for all bubbles. The global financial crisis, capital in- and outflows, internet giants’ entry and sky-high remuneration are reasons for certain bubble behaviors. Hence, market practitioners should actively recognize bubbles and observe their evolution, which will favor industrial stabilization. A perfect legal system, moderate industrial policies, a competitive market environment, and other measures are needed to confront the opportunities and challenges.

Are there bubbles in the vanilla price?

“…We have employed the bubble model to estimate the explosive behavior of the prices. It outlines that a bubble exists if the asset prices surpass the defined intrinsic values (Su et al 2019a ; Su et al 2019b ; Su et al 2020a ; Wang et al 2020 ; Su et al 2020b ). A bubble occurs when the purchasers are prepared to pay more than the fundamental prices in order to buy the desired assets (Gürkaynak 2008 ).…”

The Great Wall: Understanding Chinese People's Psychology Through the Movie Context

“…This deserves the attention of Hollywood movie production because the movie market in China is very strong. Second: Su, Liu, & Wang (2020) who studied Chinese movies in relation to their impact on the context of community employment, community work, and economic growth. In this research' context, the researchers suggest those who become a part of the movie industry must pay attention to economic stability so that the movie market can be good.…”