Economics Webinar - Goodbye My Friends and Goodbye My Career: Evidence from the Movie Industry

By analyzing a dataset with over 180,000 actors, directors and producers in the movie industry over a span of 20 years, this research provides causal evidence that network connections can influence an actor's career development. Specifically, we focus on quantifying the impact of losing a connection with a director/producer due to their death on an actor's career trajectory. Our identification strategy leverages the insight that the timing of director/producer's death is independent of actor's intrinsic ability, and hence it creates an exogenous shock to their network. Following the passing of a director/producer, our study reveals a 7.50% decline in acting opportunities for actors who had previously collaborated with them. Our findings further reveal that more experienced actors are less impacted by such a connection loss.