Music piracy: A case of “The Rich Get Richer and the Poor Get Poorer”
AbstractThere is evidence that music piracy has differential effects on artists depending on their popularity. We present a model of music piracy with endogenous copying costs: consumers’ costs of illegal downloads increase with the scarcity of a recording and are therefore negatively related to the number of originals sold. Allowing for a second source of revenues apart from record sales, we show that piracy can hurt some artists while benefiting others. Under plausible assumptions, piracy is beneficial to the most popular artists. However, this does not carry over to less popular artists, who are often harmed by piracy. We conclude that piracy tends to reduce musical variety.
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Bibliographic InfoArticle provided by Elsevier in its journal Information Economics and Policy.
Volume (Year): 24 (2012)
Issue (Month): 1 ()
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Web page: http://www.elsevier.com/locate/inca/505549
L82; K42; Piracy; File sharing; BitTorrent; Endogenous download costs;
Other versions of this item:
- Amedeo Piolatto & Florian Schuett, 2011. "A model of music piracy with popularity-dependent copying costs," Working Papers 2011/5, Institut d'Economia de Barcelona (IEB).
- Florian Schuett & Amedeo Piolatto, 2011. "A model of music piracy with popularity-dependent copying costs," Working Papers. Serie AD 2011-08, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
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