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Supply Responses to Digital Distribution: Recorded Music and Live Performances

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  • Julie Holland Mortimer
  • Chris Nosko
  • Alan Sorensen

Abstract

Changes in technologies for reproducing and redistributing digital goods (e.g., music, movies, software, books) have dramatically affected profitability of these goods, and raised concerns for future development of socially valuable digital products. However, broader illegitimate distribution of digital goods may have offsetting demand implications for legitimate sales of complementary non-digital products. We examine the negative impact of file-sharing on recorded music sales and offsetting implications for live concert performances. We find that file-sharing reduces album sales but increases live performance revenues for small artists, perhaps through increased awareness. The impact on live performance revenues for large, well-known artists is negligible.

Suggested Citation

  • Julie Holland Mortimer & Chris Nosko & Alan Sorensen, 2010. "Supply Responses to Digital Distribution: Recorded Music and Live Performances," NBER Working Papers 16507, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:16507
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    References listed on IDEAS

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    1. David J. TEECE, 2008. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," World Scientific Book Chapters,in: The Transfer And Licensing Of Know-How And Intellectual Property Understanding the Multinational Enterprise in the Modern World, chapter 5, pages 67-87 World Scientific Publishing Co. Pte. Ltd..
    2. Zentner, Alejandro, 2006. "Measuring the Effect of File Sharing on Music Purchases," Journal of Law and Economics, University of Chicago Press, vol. 49(1), pages 63-90, April.
    3. Yooki Park & Suzanne Scotchmer, 2004. "Digital Rights Management and the Pricing of Digital Products," Working Papers 04-09, NET Institute, revised Oct 2004.
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    More about this item

    JEL classification:

    • L0 - Industrial Organization - - General
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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