Import Quality

I have somehow gotten this far without blogging about the Alchian-Allen Theorem, but it is an economic principle you should understand in this international games market. It also applies to cartoons and dating, so stick with me through the econ.

Let’s start with those cartoons. You should expect anime in the English-language market to be of higher average quality (or at least broader appeal) than the anime in Japan. Why? It is not worth the cost to translate and localize crap shows. Fan-subbed series should be of lower average quality because companies will have already brought over the more lucrative (higher quality and/or more popular) titles. (Notable exceptions: bootleg fan-subs torrented while something is still mid-season; shows that are “too Japanese” to survive localization but are great if you know the culture.)

More generally in entertainment, you should expect the titles imported to be some of the best ones that country/language/culture has to offer. At least, you should expect them to have broad appeal, which is often but not always a sign of high quality. (Can I stop doing that disclaimer? Assume “better” means “better bottom line,” which is often associated with quality but sometimes with appealing to the lowest common denominator, which is not always bad either.) Lineage and Aion are probably the Korean MMOs with the most appeal in the Western market, ditto the Final Fantasies from Japan. Weird licensing issues pop up, but if the money is good enough, you can expect those highly profitable games to come over. Second tier, maybe. The equivalent of our crap games? Not worth shipping. You may have noticed other titles coming over using lower fixed costs, notably less effort at localization (contribute your favorite lousy, completely unprofessional translation) and less advertising, and you may have noticed that many of them are really poor. (The same applies in the reverse direction. WoW has many Chinese subscribers; has Age of Conan been localized for China?) As fixed costs drop, you should expect more options but lower quality or more narrow appeal. Recettear had a great localization, but a limited number of people will get excited about a fantasy adventure game where you run the item shop.

Oh, I promised you sex. This applies to human interactions as well. If you have a long-distance relationship, you will probably expect it to advance by leaps and bounds when you meet in-person, because you did not fly 5000 kilometers just to watch TV together. Similarly, if you go to something like E3, PAX, BlizzCon, etc., you are going to expect a really good experience when you drop hundreds of dollars to attend; if you go to something more local, your expectations will not be as dialed up, and you are not as invested. Let’s re-phrase that: if you live in Anaheim, you might go to BlizzCon if you think it looks pretty good, but if you live in Boston, you are only going to BlizzCon if you think it will be really awesome; same convention, different thresholds and expectations. These kinds of raised expectations can go well or lead to really huge disappointments as all the dreams (and money) you had invested in this person or convention crash on the shoals of reality.

: Zubon

6 thoughts on “Import Quality”

  1. Interesting theory, I have to admit I struggle with imported Asian games sometimes. I enjoyed FFVII through X, but I feel I’ve lost touch with the genre with XII and XIII.

    Similarly, Aion had a feel to it which just didn’t stick with me. All the characters were very pretty but there wasn’t a lot lying underneath to tuck into.

    What kind of “western” games make it big over there?

  2. There’s an interesting convers to this theory that comes immediately to mind, particularly in relation to movies, or “films” as we call them in the U.K. I don’t know if this will relate to how things work in the U.S.

    It’s a long-established truism in the U.K. that many of the best quality films are not made in English and it is absolutely de rigeur to see them in their original language. Dubbed films are not acceptable, period. It has to be subtitles or nothing. These films, however, despite their critical success, rarely play to a mass-market. They are seen mainly in specialist “arthouse” cinemas or at cinema clubs.

    Consequently, in the main the films that get “translated” (subtitled) are often not the big commercial successes in the countries where they originate, but those which have won critical awards, played well at festivals or built substantial critical word of mouth.

    If you actually look at the big box-office successes in, let’s say, France, which has a large and successful internal film industry, very few of them are those which we get to see in U.K. art cinemas. But because the received wisdom is that subtitled films do not play to a mass audience, these popular and populist films also do not receive any distribution in British mainstream cinemas. Consequently, the more commercially successful French films tend to be the least seen in the U.K. even though we see a lot of less successful ones.

    I don’t know enough about anime, or manga, to make critical judgments, but how sure are we that the stuff we receive is the “best”? May it not be “what sells best in the marketplace”? Which really isn’t the same thing at all.

  3. I think Zubon makes allowances for your final point during his article:
    “At least, you should expect them to have broad appeal, which is often but not always a sign of high quality. (Can I stop doing that disclaimer? Assume “better” means “better bottom line,” which is often associated with quality but sometimes with appealing to the lowest common denominator, which is not always bad either.)”

  4. Yes I think you are right. As I have told myself many times, don’t post first thing in the morning after waking up.

  5. This is not true though, because western audiences tastes differ. What may have broader appeal in the US might be very niche in Japan, and vice versa. For a reverse example, Japan went crazy over Gerry Anderson’s Thunderbirds: would anyone argue that it is much better than comparable British shows?

    There are too many variables for that theorem to work. Costs are never fixed between importing items, tastes differ, the amount of money a business can spend is capped causing the lower price to be taken regardless of percent change, and more. Humans are not algorithims, and economists need to learn this.

    1. You are enumerating nuances and imagining that they have not been thought of in the past 47 years, while ignoring that the core of the theorem does work and you apply it in your daily life. The fixed cost of shipping a bottle of wine across the Pacific is the same whether it is a $5 bottle of wine or a $55 bottle of wine. If you did not act on this theorem, you would visit friends in other states and countries as casually as you visit friends in the same town, but we find that people are rarely willing to travel 1000 miles for low-key hanging out; given the large fixed cost of travel, you will have a higher percentage week-long visits to distant friends than to close ones — you substitute the more expensive option when fixed costs are higher.

      If you pick situations where a larger effect dominates, yes, a larger effect dominates in those situations. If you take the vast majority of human interactions, we see high-value items being exported at a higher percentage than they are consumed locally. “It will never work” is a poor argument when it is currently happening.

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