Why do big Hollywood studios make so many bad movies that lose money?

2.13K viewsEconomicsOther

Idk if economics was the right flair but I don’t know how it’s economically feasible for big studios to lose money on a lot of films with huge budgets and to make them so bad.

In: Economics

39 Answers

Anonymous 0 Comments

They can afford to lose money because, by in large, they’re paying themselves with the lost money. When a new movie is made, a shell company is formed to create the movie, to pay the studio, the director, for the ads, etc. At that point, it doesn’t matter how the movie does, everyone involved in making it is secure and safe.

The investors don’t mind, because as a whole, the industry is very profitable. Good youtube to explain it.

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