Firstly, this allows us to explore the relationship between local firm industry annual growth rate in value-added as well as its employment growth rate and different factors in 12 years within the model.
Secondly, country could affect those variables that have to be controlled.
Lastly, this can detach the time-invariant property and only net effect of predictor is evaluated.
Firstly, the number of seats in cinema is shrinking since online platform becomes popular to general public. People do not need to sit in front of the cinema screen for watching a movie. The demand for cinema has decreased.
Secondly, market share of local movies is crowded out by foreign movies. While the foreign movie industries, especially for Hollywood movie, have a massive amount of resources for development, local film industry has a serious budget-constraint problem which stifles its development.
Thirdly, oversea appetite for Hong Kong movies is weakening. The type of local films is limited to mostly kung fu and crime films. The oversea audience feels boring toward these kinds of movies.
Lastly, rampant film piracy activity would curtail the revenue of local film companies and hurt the local film development afterwards.