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Copyright Protection, Technological Change, and the Quality of New Products: Evidence from Recorded Music since Napster

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  • Joel Waldfogel

Abstract

Recent technological changes may have altered the balance between technology and copyright law for digital products. While file-sharing has reduced revenue, other technological changes have reduced the costs of bringing creative works to market. As a result, we don't know whether the effective copyright protection currently available provides adequate incentives to bring forth a steady stream of valuable new products. This paper assesses the quality of new recorded music since Napster, using three independent approaches. The first is an index of the quantity of high-quality music based on critics' retrospective lists. The second and third approaches rely directly on music sales and airplay data, respectively, using of the idea that if one vintage's music is better than another's, its superior quality should generate higher sales or greater airplay through time, after accounting for depreciation. The three resulting indices of vintage quality for the past half-century are both consistent with each other and with other historical accounts of recorded music quality. There is no evidence of a reduction in the quality of music released since Napster, and the two usage-based indices suggest an increase since 1999. Hence, researchers and policymakers thinking about the strength of copyright protection should supplement their attention to producer surplus with concern for consumer surplus as well.

Suggested Citation

  • Joel Waldfogel, 2011. "Copyright Protection, Technological Change, and the Quality of New Products: Evidence from Recorded Music since Napster," NBER Working Papers 17503, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:17503 Note: IO LE
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    References listed on IDEAS

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    1. Rob, Rafael & Waldfogel, Joel, 2006. "Piracy on the High C's: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students," Journal of Law and Economics, University of Chicago Press, vol. 49(1), pages 29-62, April.
    2. Boldrin,Michele & Levine,David K., 2010. "Against Intellectual Monopoly," Cambridge Books, Cambridge University Press, number 9780521127264, December.
    3. Joel Waldfogel, 2011. "Bye, Bye, Miss American Pie? The Supply of New Recorded Music Since Napster," NBER Working Papers 16882, National Bureau of Economic Research, Inc.
    4. Mortimer, Julie Holland & Nosko, Chris & Sorensen, Alan, 2012. "Supply responses to digital distribution: Recorded music and live performances," Information Economics and Policy, Elsevier, vol. 24(1), pages 3-14.
    5. Boldrin,Michele & Levine,David K., 2010. "Against Intellectual Monopoly," Cambridge Books, Cambridge University Press, number 9780521127264, November.
    6. Felix Oberholzer-Gee & Koleman Strumpf, 2007. "The Effect of File Sharing on Record Sales: An Empirical Analysis," Journal of Political Economy, University of Chicago Press, vol. 115, pages 1-42.
    7. Connolly, Marie & Krueger, Alan B., 2006. "Rockonomics: The Economics of Popular Music," Handbook of the Economics of Art and Culture, Elsevier.
    8. Tyler Cowen, 2000. "Creative industries: contracts between art and commerce, by Caves, R.E. Cambridge and London: Harvard University Press, 2000, ix + 454 pp., $45.00 (cloth)," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 21(5), pages 208-209.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Copyrighted Music
      by René Böheim in Econ Tidbits on 2013-03-13 17:46:00

    Citations

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    Cited by:

    1. Bourreau, Marc & Doğan, Pınar & Hong, Sounman, 2015. "Making money by giving it for free: Radiohead’s pre-release strategy for In Rainbows," Information Economics and Policy, Elsevier, vol. 32(C), pages 77-93.
    2. Aguiar, Luis & Waldfogel, Joel, 2016. "Even the losers get lucky sometimes: New products and the evolution of music quality since Napster," Information Economics and Policy, Elsevier, vol. 34(C), pages 1-15.
    3. Josh Lerner & Greg Rafert, 2015. "Lost in the Clouds: The Impact of Changing Property Rights on Investment in Cloud Computing Ventures," NBER Working Papers 21140, National Bureau of Economic Research, Inc.
    4. Maya Bacache-Beauvallet & Marc Bourreau & François Moreau, 2015. "Piracy and creation: the case of the music industry," European Journal of Law and Economics, Springer, vol. 39(2), pages 245-262, April.
    5. Bogdan Genchev & Julie Holland Mortimer, 2016. "Empirical Evidence on Conditional Pricing Practices," Boston College Working Papers in Economics 908, Boston College Department of Economics.
    6. Joel Waldfogel, 2017. "The Random Long Tail and the Golden Age of Television," Innovation Policy and the Economy, University of Chicago Press, pages 1-25.
    7. Bazen, Stephen & Bouvard, Laurence & Zimmermann, Jean-Benoît, 2015. "Musicians and the Creative Commons: A survey of artists on Jamendo," Information Economics and Policy, Elsevier, pages 65-76.
    8. Ben Shiller & Joel Waldfogel & Johnny Ryan, 2017. "Will Ad Blocking Break the Internet?," NBER Working Papers 23058, National Bureau of Economic Research, Inc.
    9. repec:aea:jecper:v:31:y:2017:i:3:p:195-214 is not listed on IDEAS
    10. Bronwyn Hall & Christian Helmers & Mark Rogers & Vania Sena, 2014. "The Choice between Formal and Informal Intellectual Property: A Review," Journal of Economic Literature, American Economic Association, pages 375-423.
    11. Hong Luo & Julie Holland Mortimer, 2016. "Copyright Enforcement: Evidence from Two Field Experiments," NBER Working Papers 22082, National Bureau of Economic Research, Inc.
    12. Luis Aguiar & Joel Waldfogel, 2015. "Quality Predictability and the Welfare Benefits from New Products: Evidence from the Digitization of Recorded Music," JRC Working Papers on Digital Economy 2015-02, Joint Research Centre (Seville site).
    13. Belleflamme,Paul & Peitz,Martin, 2015. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9781107687899, November.
    14. Brett Danaher & Samita Dhanasobhon & Michael D. Smith & Rahul Telang, 2015. "Understanding Media Markets in the Digital Age: Economics and Methodology," NBER Chapters,in: Economic Analysis of the Digital Economy, pages 385-406 National Bureau of Economic Research, Inc.
    15. Aguiar, Luis & Martens, Bertin, 2016. "Digital music consumption on the Internet: Evidence from clickstream data," Information Economics and Policy, Elsevier, vol. 34(C), pages 27-43.
    16. repec:eee:iepoli:v:40:y:2017:i:c:p:26-40 is not listed on IDEAS
    17. Oberholzer-Gee, Felix & Strumpf, Koleman, 2016. "The effect of file sharing on record sales, revisited," Information Economics and Policy, Elsevier, vol. 37(C), pages 61-66.
    18. Barnett Jonathan M., 2014. "Copyright without Creators," Review of Law & Economics, De Gruyter, vol. 9(3), pages 389-438, January.
    19. BELLEFLAMME, Paul & PEITZ, Martin, 2014. "Digital piracy: an update," CORE Discussion Papers 2014019, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    20. R. Scott Hiller, 2016. "The importance of quality: How music festivals achieved commercial success," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 40(3), pages 309-334, August.

    More about this item

    JEL classification:

    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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