Authors: Younkin, P., Kuppuswamy, V.

Publication: Management Science

Abstract: 

When Hollywood is taken to task for the lack of diversity in high-profile films, decision-makers' responses tend to boil down to the idea that they're actually giving audiences what they want. Movies led by familiar (usually meaning white) faces are the most profitable, they argue, hence the casting of Scarlett Johansson in "Ghost in the Shell" and Tilda Swinton in "Doctor Strange."

Hollywood’s track record on showcasing minority talent and storylines is pretty awful, even considering some recent efforts to diversify programming. Some studios argue that the fault lies not with them, but with consumers, who—they claim—prefer predominantly white casts. But is there any truth to that?

Venkat Kuppuswamy and Peter Younkin, business-school professors at the University of North Carolina and McGill University, respectively, took a look at data on the film industry in order to measure how diverse casts went over at box offices.

Films with multiple black actors in leading roles achieve significantly higher domestic box-office revenues than films with no black actors, according to a new study from the University of North Carolina Kenan-Flagler Business School.

“Hollywood should take note – box-office revenues are 149% higher in films with multiple black actors in leading roles compared to films with no black actors,” says Venkat Kuppuswamy, assistant professor of strategy and entrepreneurship at UNC Kenan-Flagler.