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The Rise and Rise of Cable TV: Demand elasticity of cable television during the Great Recession
Unformatted Document Text:  CABLE SUBSCRPITIONS Anyone utilizing basic budgeting techniques might scoff at the notion that consumers will base future spending decisions on what they think their income will be (Christ, 1963), even if their income drops to nothing as it did with many during the Great Recession. However, caution should be exercised when assuming that even though Cable/ADS subscription rates increased alongside unemployment, that American consumers are irresponsible. To be fair, it may seem that way on the surface, but one must take into account the entertainment/information “bang-for- buck” ratio provided by Cable/ADS services. One way to provide empirical data backing this assumption would be to perform a qualitative analysis of residents in recession-weak DMA’s of those who were unemployed at this time and either continued to pay for Cable/ADS services, or signed up as a new customers. Such a study could answer questions lingering as to the behavioral reasons behind the results in this paper. 11

Authors: Danelo, Matthew.
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Anyone utilizing basic budgeting techniques might scoff at the notion that consumers will 
base future spending decisions on what they think their income will be (Christ, 1963), even if 
their income drops to nothing as it did with many during the Great Recession. However, caution 
should be exercised when assuming that even though Cable/ADS subscription rates increased 
alongside unemployment, that American consumers are irresponsible. To be fair, it may seem 
that way on the surface, but one must take into account the entertainment/information “bang-for-
buck” ratio provided by Cable/ADS services. One way to provide empirical data backing this 
assumption would be to perform a qualitative analysis of residents in recession-weak DMA’s of 
those who were unemployed at this time and either continued to pay for Cable/ADS services, or 
signed up as a new customers. Such a study could answer questions lingering as to the behavioral 
reasons behind the results in this paper.

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