Does China Love Hollywood? An Empirical Study on the Determinants of the Box-Office Performance of the Foreign Films in China *

Abstract

Although the sales of the motion-picture industry in China have grown incomparably to any other country during the past decade, most research related to it has focused on discourse of the political or social contexts. Using the resource-based view, our study empirically examines the determinants that encourage the audience to pay for a movie at China's box offices.

The resource-based view posits that a firm or product's competitiveness arises from valuable resources that appeal to consumers. In line with this, we hypothesized that box-office performance is affected by marketing-related resources and by a certain set of strategic variables embedded in individual films. We constructed our dataset based on the foreign films imported to and released in China from 2007 to 2009, and conducted a regression analysis. The statistical results suggest that actor reputation, China-related contents and Chinese crew participation in the movie production, and release timing are significantly related to the box-office performance of foreign films in China. We present an interpretation of our statistical results, linking to the characteristics of the current Chinese audience as a consumer for foreign films.