Rationale
While clip shows do reduce production costs, they were originally employed in an era when there were far fewer program outlets and it was less likely that episodes from previous seasons would be aired again. Clip shows typically received strong ratings, and it was expected for any successful comedy series to feature clip shows regularly in its later years. However, the episodes were subject to some ridicule due to their forced or "corny" framing devices (such as a family sitting peacefully around a fireplace) and the frequently awkward transitions between the frame story and the clips (such as characters staring into space while the screen blurs to represent "remembering").
Daytime soap operas frequently present clip shows as a way to commemorate a show's milestone anniversary or the death of a long-running character. Many fans take advantage of the shows in order to see vintage clips of a particular soap opera. One example was an episode of As the World Turns in which seven of the longest running characters were stranded in a forest and remembered some of their best moments, all in honor of AtWT's 50th anniversary.
Another common rationale for a clip show is the lack of a new show to air, due to failure to meet production schedules. For example, the computer-animated series Roughnecks: Starship Troopers Chronicles used clip shows four times for this purpose, interrupting in-progress story arcs. Similarly, the aforementioned finale episode of the second season of Star Trek: The Next Generation, "Shades of Gray", was a clip show necessitated by a writers' strike.
Clip shows today tend to offset such criticism by trying to make the frame tale surrounding the clips compelling, or by presenting clip shows without any framing device. A show might also diffuse the awkwardness by indulging in self-parody, explicitly acknowledging or intentionally over-playing the device. Many series have included parody clip shows using "clips" from episodes which never happened.
The clip show has been employed more seriously as a means to bring viewers up to date on highly serialized dramas, such as on Lost and the reimagined Battlestar Galactica. Many anime dramas used similar techniques, particularly when a series ran for more episodes in one season than could be reasonably rerun (such as Mobile Suit Gundam Wing running for 49 episodes, which were originally aired weekly).
Sometimes clip shows air before or during a series finale as a way for audiences to reminisce about their favorite moments. Some examples of shows that have used clip shows in this sense are: Animaniacs, Frasier, Seinfeld, Sex and the City, Friends, Thunderbirds, Everybody Loves Raymond, Stargate SG-1/Atlantis, Cheers and Avatar: The Last Airbender (though this recap episode had no actual clips).
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