Cultural distance in international films: An empirical investigation of a sample selection model

Abstract

Cultural products and services are created to cater to markets made up of cultural consumers. By using five different measures of national culture, the cultural distances (CDs) between Taiwan and each of 82 countries from which she imports such products and services were measured. Data on 7335 movies’ box office revenues and film characteristics from January 2013 to December 2018 were collected. The analysis shows that not only do Hollywood movies dominate the Taiwanese market, but the returns to CD decrease when an imported movie’s CD becomes larger. The effects decline at a decreasing rate. The hypothesis of cultural discounts and the U-shaped impact of inter-country CD on global cultural products are both supported. Action, science-fiction, horror, romance, adventure, thriller, and sequel movies during the Chinese New Year make more money. The robustness checks of the Heckman selection model support these conclusions. A change in box office revenue from the highest CD to the lowest CD would result in a loss of over 3.04 million US dollars.