The Society for Economic Research on Copyright Issues

Review of Economic Research on Copyright Issues (RERCI)

RERCI Articles

Capabilities, Spillovers, and Intellectual Progress: Toward a Human Flourishing Theory of Intellectual Property

Review of Economic Research on Copyright Issues, 14(1/2), 1-38, 2017

Brett M. Frischmann

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Abstract

Courts, commentators, and even casebooks mistakenly assume that intellectual property laws are fundamentally utilitarian and thus the relevant objective for intellectual property laws is maximizing social welfare. Economic theories of intellectual property dominate while rights-based theories and other alternatives struggle to remain relevant in the discourse. This essay accepts that intellectual property laws are consequentialist, but it mounts a challenge to the utilitarian theories that dominate. Following the path set by Amartya Sen in the area of development economics and borrowing heavily from the Sen's analytical and normative framework - the Capabilities Approach, this essay begins to develop a human flourishing theory for intellectual property.

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Evidence of the Effect of Free Music Downloads on the Purchase of Music CDs in Canada

Review of Economic Research on Copyright Issues, 9(2), 55-78, 2012

George Barker

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Abstract

This paper examines data on the effects of Internet peer-to peer (P2P) file sharing activities on music purchasing. The data was obtained from a survey commissioned by Industry Canada to "inform Industry Canada's policy development work" regarding copyright law reform in Canada. The paper focuses on an important survey question which has not yet been analysed. Analysis of survey responses suggests that P2P file-sharing is a substitute for legitimate music purchases and has strong negative effects on legitimate music purchases. This contradicts the results of earlier analysis of the data commissioned by Industry Canada first published on Industry Canada's website in 2007 (Andersen and Frenz, 2007), and then subsequently revised and republished as Andersen and Frenz (2010).

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Intellectual Property Regulation and Software Piracy: A Dynamic Approach

Review of Economic Research on Copyright Issues, 2018, 15(1), 38-64

Michael D'Rosario

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Abstract

Promoting Intellectual Property Rights (IPRs) is of particular importance to nations engaging in significant innovation. The existing literature relating to software piracy research is typified by the use qualitative methods to analyse the impact of IPRs on software piracy. Most concern themselves with a handful of important macroeconomic factors in an effort to identify whether they possess any explanatory power, employing qualitative frameworks for analysis. More contemporary research has given greater attention to the role of key regulatory variables on software piracy using econometric methods. In this paper, the relationship between foreign political pressure, IPR regulatory reforms and software piracy is considered. We estimate a model of software piracy as a function of bi-lateral pressure and investment (where US 301 reporting is the proxy for bilateral pressure, and capital investment the proxy for bi-lateral investment), Scientific investment, trade dependence and government effectiveness. The models are estimated using data from 80 countries over nine years. The study responds to the dearth of research employing dynamic panel estimations in estimating the impact of IPR reforms on software piracy. The findings suggest out of cycle review and US 301 reporting are pertinent factors potentially moderating software piracy.

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Music Product as a Durable Good and Online Piracy

Review of Economic Research on Copyright Issues, Vol. 3, No. 2, 53-66, 2006

Sougata Poddar

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Abstract

Music is typical experience good and the formats in which music is available; for example, CDs and cassettes or downloaded files are durable in nature. Using these two typical characteristics of the 'music product', in this paper, we develop an analytical framework to study the economic implications of online music piracy. On one hand, we show that no protection against piracy is never optimal for the legitimate music producer; on the other hand, we show that complete protection against piracy may not always be the best option; the decision on the degree of limiting piracy depends on the extent of the informational value of music downloads, cost of piracy and the quality of the downloaded music and as a result a partial protection can be optimal to the music producer.

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OSS Production and Licensing Strategies of Software Firms

Review of Economic Research on Copyright Issues, Vol. 2, No. 2, 111-125, 2005

Heli A. Koski

Downloads:  1225


Abstract

This study sheds light on the relatively recently emerged new business models employing open source activities in the software industry. We analyze data from 73 Finnish OSS companies' product type (i.e. proprietary vs. OSS product) and license type (i.e. the copyleft vs. non-copyleft licenses)choices. Our data indicate that firm ownership structure has a major influence on software firms' business strategies. Family owned firms tend to rely on the traditional proprietary software in their product selection, whereas diffusely held companies are more likely to supply OSS products. We also find that more service oriented firms are likely to offer more complementary products and further supply their products more often under the OS licenses. Moreover, the market trends concerning a firm's software products affect the license type decisions of the software firms. Consistent with the international data on the dominance of the Apache server that is released under the non-copyleft license, we find that servers are more likely to be licensed under the non-copyleft license. Our estimation results further suggest that a more restrictive form of open source licenses, the copyleft license, is used more often in those companies that have participated in open source software development projects. This finding is consistent with earlier studies that have found that more than 70% of the OSS development projects employ the GPL copyleft license.

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The Relative Effectiveness of Global Anti-Piracy Policies

Review of Economic Research on Copyright Issues, 2018, 15(1), 1-19

Tylor Orme

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Abstract

In recent decades, the problem of illegal downloading of copyrighted material has emerged as a major concern for governments across the globe. Many countries have implemented policies to limit the impact of online piracy on revenues of creative industries. These policies, while important for a broad range of industries, have been particularly lobbied for and supported by the motion pictures industry. Film production and distribution companies have repeatedly asserted that effective anti-piracy policy is crucial to their continued success. This paper seeks to evaluate whether the anti-piracy regimes in OECD countries have been effective. It also seeks to determine whether there are patterns to the types of policies that have been especially effective or ineffective.

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Remarks to the SERCI Panel on Regulatory Copyright Tariff Setting

Review of Economic Research on Copyright Issues, 14(1/2), 45-54, 2017

Gerry Wall

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Abstract

This Panel concerns possible lessons for European copyright practitioners learned from the North American experience. I pose two key questions that arise from our existing copyright tariff setting processes: 1) do we need regulatory intervention to achieve appropriate prices?; and 2) how has the process worked so far and how can we make the process better?

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Restricting Access to Books on the Internet: Some Unanticipated Effects of US Copyright Legislation

Review of Economic Research on Copyright Issues, Vol. 5, No. 1, 23-53, 2008

Paul A. David and Jared Rubin

Downloads:  1201


Abstract

One manifestation of the trend towards the strengthening of copyright protection that has been noticeable during the past two decades is the secular extension of the potential duration during which access to copyrightable materials remains legally restricted. Those restrictions carry clear implications for the current and prospective costs to readers seeking "on-line" availability of the affected content in digital form, via the Internet. This paper undertakes to quantify one aspect of these developments by providing readily understandable measures of the restrictive consequences of the successive modifications that were made in U.S. copyright laws during the second half of the twentieth century. Specifically, we present estimates of the past, present and future number of copyrighted books belonging to different publication-date "cohorts" whose entry into the public domain (and consequent accessibility in scanned on-line form) will thereby have been postponed. In some instances these deferrals of access due to legislative extensions of the duration of copyright protection are found to reach surprisingly far into the future, and to arise from the effects of interactions among the successive changes in the law that generally have gone unnoticed.

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The Four P's of Digital Distribution in the Internet Era: Piracy, Pie-Splitting, and Pipe Control

Review of Economic Research on Copyright Issues, Vol. 7, No. 2, 3-20, 2010

Joel Waldfogel

Downloads:  1198


Abstract

The first decade of the new millennium has been the decade of digital distribution for media products. All products that can be digitized have either been affected, or will soon be. Since the early days of the Internet, piracy has emerged as an important threat to media firms. But new technology also brings an opportunity for firms to engage in new models of pricing. Many of these new forms of pricing produce revenue that is not readily attributed to particular owners, making it necessary for sellers to create new methods for sharing revenue, or pie-splitting. Affected industries have mobilized to enact a number of non-market responses, including recent efforts to induce Internet Service Providers to control the flow of unpaid content through their pipes. This essay reviews the threats, opportunities, and challenges to media firms that have emerged over the past decade, with attention to piracy, pricing, pie-splitting, and pipe control.

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Copyright from an Institutional Perspective: Actors, Interests, Stakes and the Logic of Participation

Review of Economic Research on Copyright Issues, Vol. 4, No. 2, 65-97, 2007

Antonina Bakardjieva Engelbrekt

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Abstract

This article investigates recent developments in copyright, proceeding from a participation-centred comparative institutional approach (Komesar, 1994). Following institutional theory, the approach implies conceiving of the market, the political process (legislatures and administrative agencies) and the courts as alternative decision-making processes in the area of copyright law and policy. It emphasises the importance of institutional choice, based on careful comparison of the modalities for participation of different interests in these processes.
Novel digital and information technologies influence the conditions for participation in copyright decision-making at all levels and unsettle previously established institutional equilibriums. In the wake of the Infosoc Directive, a dynamic process of institutional adjustment seems to be unfolding in the Member States of the European Union whereby a variety of private, public and mixed institutional schemes for interpretation and enforcement of the new digital copyright are emerging, seeking to reconcile the interests of a variety of old and new stakeholders. This dynamism is interpreted as a search for appropriate decision-making institution to mitigate the consequences of an expansive legislative copyright policy as materialized in the Infosoc Directive and to re-establish a balance of rights and obligations. It is argued that the institutional design of these schemes and the modalities for actor participation will be crucial for their sustainable success and seem therefore to deserve more careful scrutiny. At the same time, the conservative force of institutional legacies is emphasized as a factor deterring institutional innovation.

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Dissemination Must Serve Authors: How the U.S. Supreme Court Erred

Review of Economic Research on Copyright Issues, 10(1), 1-19, 2013

Wendy J. Gordon

Downloads:  1177


Abstract

The US Congress has enacted expansions of copyright which arguably impose high social costs and generate little incentives for authorial creativity. When the two most expansive statutes were challenged as unconstitutional, the US Supreme Court rebuffed the challenges, partly on the supposed ground that copyright law could legitimately seek to promote non-authorial interests; apparently, Congress could enact provisions aiming to support non-creative disseminative activities such as publishing, or restoring and distributing old film stock, even if authorial incentives were not served. Such an error might have arisen because of three phenomena (in economics, history, and law, respectively) that might easily be misunderstood but which, when unpacked, no longer lead plausibly to a stand-alone embrace of disseminator interests. The purpose of this article is to analyse and comment on this error from several relevant points of view.

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Unauthorized Copying and Copyright Enforcement in Developing Countries: A Vietnam Case Study

Review of Economic Research on Copyright Issues, Vol. 4, No. 1, 87-96, 2007

Koji Domon and Kiyoshi Nakamura

Downloads:  1174


Abstract

At present, Vietnam is regarded as the most notorious country regarding copyright infringement. China, joining WTO in 2001, has since implemented strict copyright measures. Even though Vietnam has laws covering intellectual property rights, enforcement is almost non-existent. We investigated how unauthorized P2P file-sharing affects copyright infringement in Vietnam. We assumed, before visiting Vietnam, that P2P file-sharing was more popular than pirated CDs and DVDs. However, few people there knew of its existence. Even when they did, they were unwilling to use it. Another astonishing fact was how pirated CDs play a role in promoting singers who relied on stage performances. Singers were not eager to support copyright enforcement. In this paper we consider these situations and explain how such behavior is commonplace in Vietnam.

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Piracy and the Demand for Films: Analysis of Piracy Behavior in French Universities

Review of Economic Research on Copyright Issues, Vol. 3, No. 2, 15-27, 2006

David Bounie, Patrick Waelbroeck and Marc Bourreau

Downloads:  1173


Abstract

The purpose of this article is to identify which, if any, segments of the movie business have suffered from digital piracy. We use a sample of 620 university members including undergraduate students, graduate students and professors to assess the effect of digital piracy on legal demand. A large percentage of respondents get pirated movies from a variety of channels (on P2P networks, intranet, by physical means. . . ). Surprisingly, approximately one third of the pirates declared that watching pirated movies increased their demand for films (for instance, it led them to rent or purchase videos that they would not have rented or purchased otherwise). Using regressions analysis, we find no impact of piracy on theater attendance, and a strong impact on video rentals and purchases. However, movie piracy has no impact on video rentals for respondents who use pre-paid pricing schemes at video-stores.

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Creativity and the Economics of the Copyright Controversy

Review of Economic Research on Copyright Issues, Vol. 6, No. 2, 5-12, 2009

Harold Demsetz

Downloads:  1172


Abstract

The debate about copyright law centers on the apparent tradeoff between the creation of new works and the extent to which these works are used once they are created. Economics has been employed explicitly and implicitly to bolster positions taken by those involved in this debate. I do not directly join this debate here, but what I will say is relevant to it. My objectives are different, to draw attention to the neglect of creativity by economists and to describe some of the unique problems this neglect poses for those who use traditional economic models to explain and support the positions they take in this debate. It is no intent of mine to discourage the use of traditional economic models but, rather, to urge greater care in their use.

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Music-Use Tariffs, Options, Regulation and Bargaining

Review of Economic Research on Copyright Issues, 2019, vol. 16(1/2), pp. 40-67

Frank Mathewson, E. Jane Murdoch and Gerry Wall

Downloads:  1161


Abstract

This paper discusses the connection between rate regulation and bargaining out- comes. We consider the case of licensing musical works for radio broadcasting. Our model illustrates the impact when music broadcasters can switch to a talk format. Using a generalized Nash bargaining setting, we interpret the revenue sharing rules established within the regulatory regimes in the US and Canada. In any negotiations over a sharing rule with the collectives that own the musical works rights, the ability of broadcasters to switch from a music to a talk format constitutes the threat point for the broadcasters. Using US and Canadian data for 2014 and 2015, we derive the bargaining weights that would generate the same revenue flows for broadcast- ers and collectives as those produced under the shadow of a copyright regulatory regime. These numerical examples show a higher weight to collectives than appears from the stated tariff rates.

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