The
Harry Potter films and books have been a huge success for over a decade and a
half, ever since the first novel was published 1997. Just two short years
later, Warner Bros. bought the filmmaking rights and three of the total eight
movies became the top grossing—most profitable—film of their year of release: Harry
Potter and the Philosopher’s Stone, 2001; Harry Potter and the Goblet of Fire,
2005; Harry Potter and the Deathly Hallows—Part 2, 2011 (Box). Additionally,
the books have amounted to an estimated 450 million dollars in sales worldwide.
A big factor towards Harry Potter’s
success is due to the fact that while it is a public good with shared
consumption, it also exercises exclusion. Thus, a virtually unlimited
amount of consumers can purchase the product, given they are willing to pay the
money.
Although
there is no way to prove that each of the some 450 million copies were actually
read—moreover, some people may have illegally possessed the text, or lent their
book to a friend—it is safe to say that Harry Potter had, and continues to
have, a massive influence on today’s culture. Therefore, it unavoidably leads to negative externalities—fanatical fans
who believe it to be real, peer pressure to read the books and see the movies—yet
the positive effects far outweigh the bad. For example, leisure reading has
increased in children because 51% say they did not read for fun before
discovering the series (Garlick). These millions of Harry Potter
books—hardback, paperback, and translations—have been sold throughout planet
Earth and are available in over 65 languages, being purchased in nearly 200
territories (Garlick). The universality
of this fantasy world builds a sense of community among fellow followers of the
series, which is another positive externality.
The most profitable of the films is the final installment, both during
opening weekend and in total grosses. Interestingly, Harry Potter and the Half
Blood Price is ranked seventh among its counterparts for its opening weekend;
however, it lies in third places in terms of total grosses. These conflicting
pieces of data show a general trend toward gaining popularity as time wore on.
Numerous students have
decided that reading and watching Harry Potter is worth the opportunity cost of
doing essentially anything else with their time.
Many deprive themselves of valuable sleep to finish the novel, while others
sacrifice studying time. Some even become social hermits until the last word has
been read. Adding to the incredible popularity of the novels and films, games
and attractions have additionally helped the Harry Potter franchise grow in
value. It is estimated that the total sales of all seven books, eight movies, and
toys are $24,751,000,000
(Total). However, there has been some argument over the appropriateness of
calling Harry Potter a “franchise” because by definition, a franchise is the
authorization to sell a certain group’s goods and use their ideas; despite the
fact that all the merchandise associated with this series is extremely
profitable, it has always been one grand story, rather than a business. Indeed,
the Wizarding World of Harry Potter exists as one of the most influential
stories in muggle culture.
Works
Cited
"Harry Potter: the economics."theguardian.com.
Guardian News and Media, 20 July 2007. Web. 19 Feb. 2014.
<http://www.theguardian.com/commentisfree/2007/jul/20/harrypottertheeconomics>.
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Clearly Harry Potters economic impact has been great from their books, movies, and memorabilia. Certainly the marginal benefit from reading a book is much greater than doing many other things that adults and children alike could be doing. Sales from series like that of Harry Potter can have a great economic impact, by boosting the nations GDP. Countless fans follow different series around the world religiously and the economic impact can not be understated.
ReplyDeleteI would agree that Harry Potter has had a huge impact for the lives of everybody and for the economy. $450 million is very high for a movie series (because it was so good!) I never thought about the opportunity cost with watching Harry Potter. It does take up a lot of time because they are very long movies. What was the biggest marketing procedure that helped them advertise the movies? What other series was their biggest competitor (if any)?
ReplyDeleteWhile I have never read a Harry Potter book, I have loved watching each movie growing up multiple times. It is amazing that over the years, the total sales of everything Harry Potter came out to a total of $24,751,000,000. That is amazing! I can definitely see why Harry Potter is one of the top best sellers in the world. Since everyone loves the series so much! I never thought about the negative externalities of the series thought. How people are and where peer pressured into reading the series or seeing the movie. But I do agree that the positive externalities do in fact out weigh the negative.
ReplyDeleteI didn't realize that Harry Potter has made over $25 billion world wide. It makes sense though since it's been translated into almost every possible language for the movies and books, not to mention all of the toys and the amusement park at Disney Land or Disney World. Because of all of the publicity, Harry Potter has been getting more and more famous meaning more and more money being spent by consumers. Also, since the series is now over, people were splurging to buy Harry Potter memorabilia meaning even more in sales.
ReplyDeleteReally glad I read this because first of all, I'm a HUGE Harry Potter fan, and second, I had no idea the movies and books were bringing in over 25 billion dollars. When I think of topics like this I think of how much these movie producers and authors must charge movie theaters to play their movies..then that makes me think how the movie theaters make money. You'd think that movie theaters would make money off of the actual movie tickets but rather they make all of their profit off of their ridiculously over priced food and beverages! It took me a while to make sense of all of this because at first I was just frustrated that the movie theater could charge four dollars for a small drink while I could just drive to McDonald's and get any size drink for just a buck. It's really fascinating to think how much money movies can make when you take into consideration that movie theaters don't even benefit from ticket sales.
ReplyDeleteI'm so glad you chose to write about Harry Potter because I think the books and movies are definitely a product that has evolved and grown up with our generation. As you read the books, you can see that the author changed the depth of the story as her consumer changed -- the kids who started reading the books matured as her stories continued to grow, so she changed the level of the books in order to suit the consumer and encourage more sales. What I also find interesting about the Harry Potter “franchise” is JK Rowling’s decision to stop writing books. As you said in your piece, the books and movies have made billions of dollars, so wouldn’t it make sense for the author to continue writing books in order to increase her revenue? The marginal cost of writing another book and dragging the series on must be greater for Rowling than the marginal benefit of making more money since she has made so much money already. Since the costs outweigh the benefits, it makes economic sense that Rowling won’t write any more books.
ReplyDeleteI personally love Harry Potter now and when I would read them with my parents before going to bed when a child and then re-reading them when I got older. They've actually had a much bigger impact on my life now that I think about it. What I didn't realize was that it made a huge impact on the world around me as well. I find it amazing that they have brought in over $25 billion dollars over the years but then again they did make a amusement park going around the series and making huge profits on the movies. Coming from the perspective of a child who has grown up with Harry Potter I don't think it will ever completely leave my life, because i plan on reading them to my children as well which will automatically bring in more money for the "franchise"
ReplyDeleteThis was really interesting to read an economic perspective on such a universal and widespread culture... Harry Potter. I think that the usage of externalities was good, be careful with negative externalities because they are spillover costs from one group or persons actions. I agree with your analysis of opportunity costs and this was just very cool to see how this loved story has shaped the economy and peoples lives
ReplyDeleteHarry Potter has affected everyone regardless if you are a fan or not. I am a fan of not only the Harry Potter series but also others like Twilight and Hunger Games. I am willing to pay anything just to see the latest movie or read the newest book. While watching all these movies like Harry Potter, I never thought of the opportunity cost! I find it incredible that they have brought in over $25 billion dollars over the years! The books and movies have made billions of dollars, so wouldn’t it make sense for JK Rowling to continue to write books to make more money? I guess between the amusement park and all the wardrobe and gifts, the series is making enough of a profit. Since the series is now over, people are willing to pay anything for Harry Potter souvenirs which only leads to even more in sales.
ReplyDeleteAlthough I knew that Harry Potter was popular, I never would have considered that it had such a high profit or that it has affected the population so dramatically. As the series went on, people began to read them more or see the movies. The change in peoples' tastes obviously inspired other people to want to get into the series, therefore causing an increase in demand for the books and movies. The fandom has certainly made Harry Potter one of the most successful series, and it would definitely be hard for another series to beat the profits and income made from the wonder that is Harry Potter.
ReplyDeleteIt was interesting seeing this analysis on the Harry Potter franchise done from an economic perspective. The negative externalities you mentioned are interesting. Is peer pressure necessarily a negative externality? If it is getting more kids to begin and enjoy reading, I would personally argue that it would be a positive externality as it promotes literacy rates. These increased literacy rates eventually translate into greater ease in school, which in turn would give the children more time and resources to accomplish other goals. In a way, reading a Harry Potter book could be seen as an investment this way.
ReplyDeleteI think it is great that you chose a topic that would have some much interest, I recently saw all the movies and now I love Harry Potter. To see that it had such an effect everywhere in the world is incredible, it seems like a chain reaction, the more people read and watched the movies, the more others wanted to do the same, just like the peer pressure you described. I never pictured watching the movies or reading the series as an opportunity cost, great job!
ReplyDeleteWhen I was a child I remember getting a Harry Potter book from my Grandmother for my birthday. I never read it. I read books all the time now and after watching all the movies, I regret not reading the book. Harry Potter has influenced so many people in our world today and has a great impact on our economy. For example, like Lian said, "numerous students have decided that reading and watching Harry Potter is worth the opportunity cost of doing essentially anything else with their time." Such an interesting series can entertain our world so much that there is a large enough profit to support theme parks like the Harry Potter theme park in Orlando. Fanatics dream of going to places like this and demand spirit wear. Honestly, even with the series coming to an end, I believe that the Harry Potter merchandise will never become scarce and the "legend" will live on.
ReplyDeleteI could not agree more that the opportunity benefit of watching Harry Potter far outweighs the opportunity cost. The incomparable numbers the saga has brought to the table is absolutely incredible. The negative externalities that you mentioned I have to disagree with because I tend to take the story to an extreme for I am one of those fanatical fans! I do wonder if the opportunity benefit by the actors outweighs the cost of devoting so much of their life to the production of the films. With that being said, it is incredible what the imaginative mind of J.K. Rowling could do for our generation and what next multibillion dollar series may be among us.
ReplyDeleteI am in love with the Harry Potter movies and my sister is even more in love with them and the books, as she has read the entire series multiple times. I think it's insane to see how much revenue that the saga has brought in as you mentioned and Amanda makes an interesting point with the opportunity cost for the actors as they gave up so much time to make the films. I also think it's interesting how the sage is exclusive to people, yet the demand it gained from fans is crazy as you see by the sales.
ReplyDeleteFirst off, great job with your piece, I found it somewhat funny that you didn't do such a serious world topic and one that most of the nation truly enjoys! I never knew how much it truly made in sales, but I would have to say that from only a few movies, when warner bros picked up the filmrights was a big risk, putting their marginal benefit at risk, yet it has clearly paid off and made great marginal benefits to the whole franchise of Harry Potter. I think that some of what you meantioned for negative externaltities would have been more positive for most people when it comes to harry potter because if someone doesn't like the series they do not have to involve themselves. Although, I do agree completely that it does so well because it can be a shared consumption by sharing books and movies, yet clearly making a great profit with everything that you have to pay for and even with their new amuesment part the Wizarding World of Harry Potter. Overall, good job on your article!
ReplyDeleteI feel like this is such an interesting perspective of the role entertainment plays in economics. With a series as captivating at the Harry Potter series, it was bound to bring in money. I read five of the books and own all the movies and even though they were long books and movies, the benefit outweighed the cost. People are attractive to the creative, fantasy land of Hogwarts. I'm sure it was the escape they felt when reading or watching the stories of the wizards that caused them to invest their time. The movie theaters' economies must have improved significantly with every new release of a Harry Potter movie. As sad as it is that the series is over, there are multiple series impacting the economy, such as the Hunger Games. I'm glad you choose this topic!
ReplyDeleteIt is truly amazing how much money this book and movies series has brought into local economies. I mean with the additionally revenue to the movie theater of book store leads to a tricky down effect that is work much more. Image how much the Hunger games series will be worth in a couple of years if Harry potter is worth that much.
ReplyDeleteI always wondered if J.K Rowling ever imagined seeing her books explode with popularity. Her net worth is over $1 billion and I'm sure she's very happy with how this turned out for her. I personally was hooked after the first movie, although I never read the books. This was a really well-written post and I like that you made the economic references bold - it made me focus on what it was saying rather than just read over it. I think books do offer an escape and a great past-time for people of all ages, and it's nice to see that reading is a substitute for technology. Other great series such as The Hunger Games, Divergent, and The Mortal Instruments are offering the same wonderful alternative to reality, and I think these authors and everyone involved with the books and movies deserve to get paid for creating such amazing factors of culture.
ReplyDeleteIt’s been obvious for a very long time the grand impact that the Harry Potter movies have left on the world, and the influence it carries especially the increase in children’s leisure reading with 51% reading because they enjoyed the series. But, how long do you think the series will continue to impact kids? The positive externality that is the Harry Potter community is compiled with kids who grew up with the books, but now with the movies do you think that the demand for the Harry Potter books will decrease among younger kids and future generations?
ReplyDeleteI loved reading this because I am a big fan of Harry Potter, and although I didn’t read the books, my friends and I loved the movies so much that we made a “Harry Potter Club” in 8th grade. Of the 450 million copies of the books, my family owns all seven books in the series. We also own all of the movies, and duplicates on Blu-ray. It’s weird to think about, but we have contributed to the overall profits of the Harry Potter series. Besides the books and movies, I went on vacation and contributed more to the profit by going to the Wizarding World of Harry Potter in Universal Studios last spring break. My friends and I boosted profits in other industries as well like the food industry by buying plenty of snacks to make the “Potter parties” the best they can me. It has definitely been a positive externality in my life and the lives of my friends and family.
ReplyDeleteIt was fascinating to see how much money overall Harry Potter films, books and memorabilia has been brought in over the years. I have never read the books but I’ve seen some of the movies, and I have also visited the Wizarding World of Harry Potter in Orlando. When I was there I wanted to buy every thing because it was all so cool, even though I'm not even the biggest fan! There were tons of people walking around in Harry Potter robes and those are over a hundred dollars a piece. They are still bringing in a ton of money even though the series has since then ended, and if JK Rowling were to write another book for the series the 25 billion dollar price would for sure go up. It goes to show how successful the author and producers of the book and movies have been.
ReplyDeleteI would agree that Harry Potter series have had a huge impact on everyone's lives because they are so widely known. This series or book, movies, and many other products have brought in a huge profit of over $450 million, which is a lot of sales for books and movies. They are still bringing in more money even though the series is discontinued. Eventually in the future, the price for Harry Potter items will move definitely increase because of it being such an interesting fantasy series that almost everyone has seen.
ReplyDeleteI always new the business surrounding Harry Potter was a rather large one, but I didn't realize how high the profits were--it's incredible! I do wish you would have added something about the theme park at Disney World, as I know that brings in some profits too, but maybe it didn't tie in with what you were writing. But I love how you did your post on a relatively known series by all, even if they are not a fan or have no business with the whole idea of Harry Potter. It's amazing how one series that was originally turned down by 19 publishers eventually brought in billions of dollars in profits!
ReplyDeleteWith the number of books and movies accommodating each book, it doesn't surprise me as to how much money Harry Potter made in sales. This series was so popular it makes me wonder what other series such as the Twilight Saga and the Hunger Games made and if the amount is anywhere near the amount that Harry Potter made. Even though the books have been out for a while and all the movies have been made to go with each book, they are still able to entertain their fans. I know that in Orlando Florida they have a place called the Wizarding World of Harry Potter located in Islands of Adventure. Although I never have been the biggest fan of Harry Potter, I still have gone there, multiple times, just because of it's popularity. It's crazy how they made it look so similar to the movies and it feels like we're actually in Hogwarts. Harry Potter has such a significant impact on individuals because it's even able to give entertainment to those that aren't considered die hard fans.
ReplyDeleteWOW! That total price for the over all purchases in movies and books and toys. I knew a lot of people were Harry Potter fanatics, but holy cow! Even the fact that everything is available in 65 different languages. I remember when reading was considered 'uncool' and people that they you were freaks when you spent your leisure time reading a book. The opportunity cost has changed completely with Harry Potter around. Not only Harry Potter, but more books like Divergent and other books are high in interest. This truly is surprising because our communication and learning has all switched over to technology, so are books going to rise in interest or are books going to go extinct just like the elephant in the near future?
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