Share on X Share on Facebook Share on LinkedIn Written by So Hye Yoon March 8, 2024 So Hye Yoon attended Dreamgirls at McCarter on March 8th, 2024. She is a 4th year Ph.D. Candidate in Economics at Princeton University. Her areas of research include Industrial Organization and Finance. This essay is part of The Scholar's Take Series. As the vibrant stage lights cast their glow, the musical Dreamgirls offers a glimpse into the glamorous yet challenging world of show business. Exploring the show from an economic standpoint proves intriguing, particularly considering the music industry's dependence on predictive methods for assessing profitability. While the intangible concept of good overcoming evil is difficult to quantify — and occasionally labeled in economics as an “expectation error” — recognizing the significance of fostering a culture of decency in our lives remains paramount. In Dreamgirls, close friends and singers Effie, Deena, and Lorrell embark on their journey at the Apollo Theater with dreams as bright as the stage lights, eager to showcase their talents as “The Dreamettes.” Their captivating performances catch the attention of management, propelling them towards stardom. As they climb the ladder of fame, their path takes a dramatic shift that puts a strain on their friendships and personal lives. Curtis, their manager, changes their name to “The Dreams,” promotes Deena to lead, and moves Effie (the more powerful vocalist) to the background, citing Deena's conventional beauty and lighter voice as more appealing and marketable. This sparks conflict within the group and ultimately leads to Effie's departure. At first, it appears that Curtis' predictions were on target: Deena and The Dreams rise to fame and Effie struggles, eventually falling completely out of the spotlight and music industry. In time, however, Effie's humbling journey teaches her the importance of pushing through adversity, being selfless, and finding fulfillment beyond fame. And, despite The Dreams' commercial success, Deena is stifled by Curtis' control and Lorrell is stuck in a destructive relationship. Eventually, Deena and Lorrell claim their independence, and Effie reclaims her artistry and the recognition she deserves. This paves the way for reconciliation and gives “success” a new meaning. Audiences may ponder the unpredictable nature of who earns the spotlight and why. Anticipating demand isn't just a fascination within show business; it's a longstanding interest in Industrial Organization, a field of Economics. Following past trends in order to deduce what products will have future success is not always straightforward. What happens when there are too many products on the market to consider, or when new products enter — akin to Deena, Lorrell, or Effie? Can we confidently predict who will gain more attention?Many economists have studied this issue. One approach to estimating consumer preference is the product space model. Basically, while it is easy to analyze a few products individually, comparing a large number is challenging. In the context of the music industry, we might ask: what criteria should we use for comparing the thousands of musicians recording in the US? One solution within the product space model is to use Gorman's (1971)1two-stage budgeting problem, which organizes products into layers and evaluates them within the same group.2 For example, breaking down singers into more manageable genres, such as R&B, Pop, and so on. On the other hand, when it comes to predicting the preference for a product yet to enter the market, the characteristic space model offers a good solution. This model operates under the assumption that a product is essentially a bundle of characteristics, and consumers have preferences for these characteristics, rather than for individual products. In the context of show business, characteristics may include powerful sound, harmonized vocals, appearance, style, etc. By examining the attributes of past singers and factors like album sales and downloads, the characteristic space model can ascertain which characteristics carry greater weight with consumers. It can even estimate which demographic segments are more inclined toward certain characteristics. In this framework, the introduction of new products becomes less significant, as they are merely combinations of characteristics already analyzed. So, if we know that audiences highly value a powerful sound, we can predict the rise of a singer like Effie. Applying an economic perspective to Dreamgirls adds depth to analyzing the allure of its characters and their potential success. The musical invites academic curiosity by raising questions about demand prediction. For me, it also illuminates the importance of human values, raising an issue not typically pondered: Must we resign ourselves to frustration and conflict if we anticipate being less desired in the marketplace? Dreamgirls suggests otherwise: strive to do your best, treat others with respect, and have faith that those around you may overcome, and even exceed, the assumed prediction. 1 Gorman, Willam M. "Two stage budgeting." unpublished paper, London School of Economics and Political Science (1971). 2 Hausman, Jerry, Gregory Leonard, and J. Douglas Zona. “Competitive Analysis with Differentiated Products.” Annales d’Économie et de Statistique, no. 34 (1994): 159–80. https://doi.org/10.2307/20075951. The Scholar’s Take is a series of essays by Princeton students in response to experiences at McCarter. It is part of Arts & Ideas which connects University scholarship and campus life to the work on our stage. Co-sponsored by the Humanities Council at Princeton University. Related People So Hye Yoon, GS, ECO GradFUTURES Stories & News McCarter Theatre’s ‘Arts & Ideas’ is attracting extraordinary artists to engage with faculty and students Sept. 24, 2024 Sciences & Engineering Graduate Students Plan for Faculty Careers at 2024 Future Faculty Workshop Sept. 24, 2024 Alumni Mentorship Leads to Graduate School Partnership with Munich Re & Expanded Opportunities for Ph.D.s Sept. 10, 2024 Ph.D. candidate Charmaine Branch researches teaching with difficult visual materials in GradFUTURES fellowship Sept. 9, 2024