| Liebowitz and Margolis (2005)
|| Seventeen famous economists weigh in on copyright: The role of theory, empirics, and network effects
|| Liebowitz, SJ, Margolis, SE
|| Liebowitz, S. J., & Margolis, S. E. (2005). Seventeen famous economists weigh in on copyright: The role of theory, empirics, and network effects. Harvard Journal of Law and Technology, 18(2).
|| Definitive , Open Access
|Key Related Studies:
|| Arai and Kinukawa (2014), Baker and Cunningham (2006), Buccafusco and Heald (2012), Heald (2007), Png and Wang (2006)
On May 20, 2002, seventeen economists, including five Nobel laureates, presented an amicus curiae brief discussing the economics of copyright extension in support of the petitioners in Eldred v.
Ashcroft, a Supreme Court case challenging the constitutionality of the Sonny Bono Copyright Term Extension Act of 1998 (CTEA). Readers would have every reason to believe that the arguments set
forth in this document are sound down to the smallest details. Yet this is not the case. This article provides a counterweight to the amicus brief, identifying some points the economists ignored, clarifying some discussions they did not quite get right, and providing data that runs counter to some assumptions they made.
Main Results of the Study
- This article agrees with the Eldred economists on the inefficiency of copyright extension applied to existing works, if the analysis is restricted to incentives to create. However, there are other important considerations that might reverse this conclusion.
- The economists’ second point (new works) is not as clear-cut and is incompletely explored in the brief.
- The data that economists would need, but do not have, include (1) the number and value of new works created as a result of extensions of copyright duration; (2) the reduction of surplus for reproductions of copyrighted materials under extended copyright, relative to the surplus that would be generated if copyright protection were less lengthy
- There is a possibility that for some authors, in some range of income and propensity to create, a small increase in present value could make an important difference in creative output, perhaps because they reach a point where they switch to full-time writing
- An unpublished empirical research carried out by Lebowitz in the 1980s back up anecdotal evidence — that the distribution of book sales is very highly skewed toward the more successful book titles.
- More than half of the best-sellers in the 236 sample remained in print for a long enough period of time that the 1976 extension to the copyright law would likely have affected the present value of future book sales
- Even for non-best-sellers, a third still survived after fifty-eight years, indicating that a fairly significant share of other important books would likely be affected by changes in copyright law even when the copyright term is quite long.
- The inferences about depreciation rates of books drawn from overall survival rates are likely to be misleading. The great majority of books are obscure
Policy Implications as Stated By Author
- A more complete view requires consideration of the responsiveness of creative efforts to marginal incentives and the function of ownership of intellectual property beyond the incentive to create.
- A more nuanced view requires attention to the limitations in the exclusionary aspect of copyright law.
- A more correct view requires an examination of empirical magnitudes that no one has fully undertaken.
Coverage of Study
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