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Digital Technology and the Allocation of Ownership in the Music Industry

Author

Listed:
  • Maija Halonen-Akatwijuka

    (University of Bristol)

  • Tobias Regner

    (Max Planck Institute of Economics, Jena)

Abstract

We apply the property rights theory of Grossman-Hart-Moore in the music industry and study the optimal allocation of copyright between the artists who create music and the labels who promote and distribute it. Digital technology opens up a role for new intermediaries. We find that entry of online platforms occurs only if they are sufficiently more productive in distribution than the incumbent label. Furthermore, entry leads to a change in bargaining positions and it can become optimal for the copyright to be shifted from the label to the artist.

Suggested Citation

  • Maija Halonen-Akatwijuka & Tobias Regner, 2009. "Digital Technology and the Allocation of Ownership in the Music Industry," Jena Economic Research Papers 2009-096, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2009-096
    as

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    File URL: http://www.wiwi.uni-jena.de/Papers/jerp2009/wp_2009_096.pdf
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    References listed on IDEAS

    as
    1. Hart, Oliver & Moore, John, 1990. "Property Rights and the Nature of the Firm," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1119-1158, December.
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    Cited by:

    1. Gans, Joshua S., 2015. "Remix rights and negotiations over the use of copy-protected works," International Journal of Industrial Organization, Elsevier, vol. 41(C), pages 76-83.

    More about this item

    Keywords

    property rights theory; copyright; internet; music industry;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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