5.1 Discussion
The PRC assumes that income determines changes in mass media spending, because the relationship between the two variables is hypothesized to be proportional. Evidently, this is proven in China. This research also suggests that significant determinants of GNP on advertising expenditures vary according to the type of mass media expenditures.
In China, GNP is a good predictor of changes in advertising expenditures. GNP can be proven in all mass media and total advertising expenditures. Clearly it is equally important to run regression analysis with individual categories of mass media expenditures as it is with GNP.This study accords to Dupagne (1997) to test the important of incorporating current as well as lagged regressors beyond PRC’s current income model. The fact that lagged
advertising expenditures (Adt-1) was found to be good predictor for some of the regressions such as TV and magazine.
Because of special situation on citizen data collection in China, this study also tests respectively rural income and urban DPI changes in advertising expenditures. We found that the urban DPI is a better predictor than rural income. The result is reasonable because advertisement is a symbol of economics growth. Rural citizen don’t have more money to
“pay” on advertisement than urban citizen do.
In sum, the major conclusion of this study is that one of the basic assumptions underlings the relative constancy hypothesis. Although the media and advertising industry were still
controlled by Chinese government, the amount of people spend with mass media is relatively constant or fixed, is also proven in China. Therefore, we infer that the man-made interference is not stronger to affect PRC hypothesis. In the future, there will more and more media develop rapidly in China, the PRC model could examine constantly to help understanding the advertising industry thoroughly.
5.2 Future Research
In future research, researcher could focus on the special situation of China and try to find more predictors. This study is examining PRC model with the popular indictor, GNP as a predictor. Notwithstanding GNP is proven in China, the future research could find other variables
to test Chinese data whether are better explanation or not.
Second, researchers could also focus the each mass media to find the more suitable predictors and to incorporate citizen income (rural income and urban DPI) with. The third field is to test further such as function e1uivalence—whereas the level of total media expenditures is expected to remain uniform over time. Because the insufficiency of data of internet and cable,
.
REFERENCE
Chen, L. D. " The concept of modernization and mass media in China," Paper Presented to the 34th International Congress of Asian and North African Studies, Hong Kong (1993)
China State Statistics Bureau "China Statistics Yearbook 2001," Beijing: China State Statistic Publications (1999)
China State Statistics Bureau "China Statistics Yearbook 2001," Beijing: China State Statistic Publications (2002)
China State Statistics Bureau "China Statistics Yearbook 2001," Beijing: China State Statistic Publications (2004)
Demers. David P. "Relative Constancy Hypothesis, Structural Pluralism, and National Advertising Expenditures," Journal of Media Economics 7(4):
31-48 (1994).
Dimmick, John "The Theory of Niche and the Spending on Mass Media: The Case of the 'Video Revolution'," Journal of Media Economics 10(3):33--43 (1997).
Dupagne, Michel. "Testing the Relative Constancy of Mass Media Expenditures in the United Kingdom," Journal of Media Economics 7(3):1-14 (1994).
Dupagne, Michel. “ A Theoretical and Methodological Critique of the Principle of Relative Constancy.” Paper Presented at the Annual Convention of the Association for Education in Journalism and Mass Communication, Atlanta, Washington, DC. August (1995)
Dupagne, Michel. “The Evolution of Consumer Mass Media Expenditures in Belgium, 1953-1991.” Paper Presented at the Annual Convention of the Broadcast Education Association, Las Vegas, NV. April (1996)
Dupagne, Michel. "Beyond the Principle of Relative Constancy:
Determinants of Consumer Mass Media Expenditures in Belgium," Journal of Media Economics 10(2): 3-19 (1997).
Fullerton, Hugh S. “Technology Collides with Relative Constancy: The Pattern of Adoption for a New Medium.” Journal of Media Economics 1:75-84 Fall (1998)
Gang F., Perking D.H. and Sabin L. ”People’s Republic of China: Economic Performance and Prospects.” Asian Development Review, vol. 15, no. 2. pp. 43-85 (1997)
Glascock, J. “Effect of Cable Television on Advertiser and Consumer Spending on Mass Media.” Journalism Quarterly 70(3), 509-517
Guo Q. G., Tong F.,Niu H. and Yip L.S.C. ”Firms’ Media Strategy in the Advertising Industry of China.” Proceedings of the Fifth International Conference of Marketing and
Development, eds. Basu K., Joy A. and Hansheng Z., June 22-25, 1995, Beijing, People’s Republic of China, pp. 403-405 (1995)
Hsu R. C. “Economic Theories in China, 1979-1988.” Cambridge University Press (1991) Lacy, Stephen, and Ghee-Young Noh. "Theory, Economics, Measurement, and
the Principle of Relative Constancy," Journal of Media Economics 10(3):3-16 (1997).
Luk S.T.K., Li H.Y., Guo Q.G.and Yip L.S.C.,The Strategic Roles of Advertising
Agencies in China’s Domestic Market, unpublished Working Paper, Hong Kong Polytechnic University (1995)
McCombs, Maxwell, and Chaim Eyal. "Spending on Mass Media," Journal of Communication 30(1):153-158 (1980).
McCombs, Maxwell, and Jack Nolan. "The Relative Constancy Approach to Consumer Spending for Media," Journal of Media Economics 5(2):43-52 (1992).
Mu Lin ”Changes and Consistency: China’s Media Market After WTO Entry” Journal of Media Economics17(3):177-192 (2004).
Pia Polsa, Stella L.M. So and Mark W. Speece. “The People’s Republic of China: Markets within the Market”
Picard , R. “Media economics: Concepts and issue.” Newury Park, CA: Sage (1989)
Pual Siu-nam Lee “Mass communication and National Development in China: Media Roles Reconsidered” Journal of Communication 44, 3; (1994).
Robert, G. Picard “Effect of Recessions on Advertising Expenditure: An Exploratory Study of Economic Downturn in Nice Developed Nations.” Journal of Media Economics14
Son, Jinok and Maxwell McCombs. "A Look at the Constancy Principle Under Changing Market Conditions," Journal of Media Economics 6(2):23-36 (1993).
Werner, Anita. “Mass Media Expenditures in Norway: The Principle of Relative Constancy Revisited.” In Margaret McLaughlin, ed. Communication Yearbook 9. Beverly Hills, Calif.: Sage (1986)
Wood, William C. “Consumer Spending on the Mass Media: The Principle of Relative Constancy reconsidered.” Journal of Communication 36(2)39-51 (1986).
Wood, William C., and Sharon L. O'Hare. “Paying for the Video Revolution:
Consumer Spending on the Mass Media.” Journal of Communication 41(1):24-30 (1991).