Abstract
We identify significant cross‐selling effects in the home video industry: a 10% increase in the demand for a studio's old titles leads to a 4.7% increase in new title sales. We argue this is due to supply‐side effects: studios with strong titles are better able to “push” other titles through retailers; and the latter “push” these additional supplies to consumers by means of lower prices and/or heavier advertising. Our strategy for identifying causality is based on “star power” effects: increases in old movie demand caused by recent success of movies with a similar cast and/or director.
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