The Effect of User-Generated Social Media on Product Demand

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Microblogging social media like Twitter and Sina Weibo has become increasingly popular among Internet users. It also becomes an important advertising tool in emerging markets. However one key question remains unclear: whether and how user-generated social media causally affects demand. In this research we will answer this question in the context of TV shows. We will use a natural experiment to examine the causal effect of microblogging on the demand of TV shows. Furthermore, we will examine what type of products (i.e., TV shows of polarized preference or unimodal preference) benefits more from microblogging. Finally, we will investigate which type of microblogging users (celebrities or ordinary active users) contribute more to the effect of microblogging on demand.

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