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January 13, 2009
A paper for my NetFlix subscribing readers
Anecdotal evidence from my family and friends has long suggested that people rent aspirational movies from Netflix that sit unwatched while movies of lower artistic value but greater entertainment value are quickly watched and returned. A new working paper, Highbrow Films Gather Dust: Time-inconsistent Preferences and Online DVD Rentals provides statistical evidence that this is a real phenomena. Now that it is possible to download movies from Netflix, we should see an even greater fraction of the movies watched through the service shifted to entertaining from artistic. That's because before you might rather watch an artistic film from your mailbox than the particular entertaining movie in your mailbox. But now your every artistic movie has to compete with every entertaining movie. That's a larger opportunity set, so it is possible that people could consume more artistic films if just the right one presented itself. And yet, since people seem to prefer the entertaining ones in most two way comparisons, expanding the choice set just gives you more superior options to choose from.
Posted by OneEyedMan at January 13, 2009 3:15 PM
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