Difference between revisions of "Piolatto and Schuett (2012)"

From Copyright EVIDENCE
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|Year=2012
 
|Year=2012
 
|Full Citation=Piolatto, Amedeo, and Florian Schuett. Music piracy: A case of “the rich get richer and the poor get poorer”. Information Economics and Policy 24.1 (2012): 30-39.
 
|Full Citation=Piolatto, Amedeo, and Florian Schuett. Music piracy: A case of “the rich get richer and the poor get poorer”. Information Economics and Policy 24.1 (2012): 30-39.
|Abstract=There is evidence that music piracy has differential effects on artists depending on their
+
|Abstract=There is evidence that music piracy has differential effects on artists depending on their popularity. We present a model of music piracy with endogenous copying costs: consumers'costs of illegal downloads increase with the scarcity of a recording and are therefore negatively related to the number of originals sold. Allowing for a second source of revenues apart from record sales, we show that piracy can hurt some artists while benefiting others. Under plausible assumptions, piracy is beneficial to the most popular artists. However, this
popularity. We present a model of music piracy with endogenous copying costs: consumers’
+
does not carry over to less popular artists, who are often harmed by piracy. We conclude that piracy tends to reduce musical variety.
costs of illegal downloads increase with the scarcity of a recording and are therefore
 
negatively related to the number of originals sold. Allowing for a second source of revenues
 
apart from record sales, we show that piracy can hurt some artists while benefiting others.
 
Under plausible assumptions, piracy is beneficial to the most popular artists. However, this
 
does not carry over to less popular artists, who are often harmed by piracy. We conclude
 
that piracy tends to reduce musical variety.
 
 
|Authentic Link=http://www.sciencedirect.com/science/article/pii/S0167624512000030
 
|Authentic Link=http://www.sciencedirect.com/science/article/pii/S0167624512000030
 
|Reference=Shapiro and Varian (1999); Liebowitz (1985); Peitz and Waelbroeck (2006a); Yoon (2002);
 
|Reference=Shapiro and Varian (1999); Liebowitz (1985); Peitz and Waelbroeck (2006a); Yoon (2002);
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* The most successful artists are likely to feel the least effect of piracy
 
* The most successful artists are likely to feel the least effect of piracy
 
* This means that less successful and newer artists feel more effect from piracy and this may be a barrier to joining the industry, leading to lower social welfare for consumers who will have less choice in the musicians available
 
* This means that less successful and newer artists feel more effect from piracy and this may be a barrier to joining the industry, leading to lower social welfare for consumers who will have less choice in the musicians available
|Description of Data=Literature review
+
|Description of Data=Analysis of the effects of piracy on successful musicians and smaller musicians
 
|Data Year=1994 to 2012
 
|Data Year=1994 to 2012
 
|Data Type=Secondary data
 
|Data Type=Secondary data
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|Country=Global;
 
|Country=Global;
 
|Cross-country=No
 
|Cross-country=No
|Comparative=No
+
|Comparative=Yes
 
|Government or policy=No
 
|Government or policy=No
 
|Literature review=Yes
 
|Literature review=Yes
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}}
 
}}
 
|Dataset={{Dataset
 
|Dataset={{Dataset
|Sample Size=1
+
|Sample Size=2
|Level of Aggregation=Individual data,
+
|Level of Aggregation=Markets for musicians,
 
|Data Material Year=1994 to 2012
 
|Data Material Year=1994 to 2012
 
}}
 
}}
 
}}
 
}}

Revision as of 08:37, 14 April 2016

Advertising Architectural Publishing of books, periodicals and other publishing Programming and broadcasting Computer programming Computer consultancy Creative, arts and entertainment Cultural education Libraries, archives, museums and other cultural activities

Film and motion pictures Sound recording and music publishing Photographic activities PR and communication Software publishing Video game publishing Specialised design Television programmes Translation and interpretation

1. Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare 2. Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)? 3. Harmony of interest assumption between authors and publishers (creators and producers/investors) 4. Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption) 5. Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)

A. Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right) B. Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction) C. Mass digitisation/orphan works (non-use; extended collective licensing) D. Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability) E. Fair remuneration (levies; copyright contracts) F. Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)

Source Details

Piolatto and Schuett (2012)
Title: Music piracy: A case of “The Rich Get Richer and the Poor Get Poorer"
Author(s): Amedeo Piolatto and Florian Schuett
Year: 2012
Citation: Piolatto, Amedeo, and Florian Schuett. Music piracy: A case of “the rich get richer and the poor get poorer”. Information Economics and Policy 24.1 (2012): 30-39.
Link(s): Definitive
Key Related Studies:
Discipline:
Linked by:
About the Data
Data Description: Analysis of the effects of piracy on successful musicians and smaller musicians
Data Type: Secondary data
Secondary Data Sources:
Data Collection Methods:
Data Analysis Methods:
Industry(ies):
Country(ies):
Cross Country Study?: No
Comparative Study?: Yes
Literature review?: Yes
Government or policy study?: No
Time Period(s) of Collection:
  • 1994 to 2012
Funder(s):
  • Amedeo Piolatto acknowledges financial support from IVIE, the Spanish Ministry of Science and Innovation (Grant ECO2009-12680), the Barcelona GS Research Network and the Generalitat de Catalunya (Grant 2009 SGR 102).

Abstract

There is evidence that music piracy has differential effects on artists depending on their popularity. We present a model of music piracy with endogenous copying costs: consumers'costs of illegal downloads increase with the scarcity of a recording and are therefore negatively related to the number of originals sold. Allowing for a second source of revenues apart from record sales, we show that piracy can hurt some artists while benefiting others. Under plausible assumptions, piracy is beneficial to the most popular artists. However, this does not carry over to less popular artists, who are often harmed by piracy. We conclude that piracy tends to reduce musical variety.

Main Results of the Study

The impact of piracy varies depending on the artist’s popularity. Our findings generalize a result found in a different setup by Gayer and Shy (2006). Like them, we show that piracy is beneficial to popular artists when side revenues are important. However, in our model this does not necessarily carry over to less popular artists: under plausible conditions on the parameters governing quality degradation and copying costs, these artists are harmed by piracy, and this can occur even when side revenues are large enough for piracy to benefit popular artists. Therefore, we have argued that piracy may be bad for social welfare since in the long run it may reduce musical variety. To conclude, let us briefly note that this negative result is mitigated when piracy, through its effect on recognition, has a positive impact on the probability of a relatively unpopular artist to become a star, as in Alcalá and González-Maestre (2010), which is likely to be the case in the presence of imperfections in the talent revelation process (Terviö, 2009, see).

Policy Implications as Stated By Author

  • Piracy is not necessarily bad for the creators of music
  • The most successful artists are likely to feel the least effect of piracy
  • This means that less successful and newer artists feel more effect from piracy and this may be a barrier to joining the industry, leading to lower social welfare for consumers who will have less choice in the musicians available



Coverage of Study

Coverage of Fundamental Issues
Issue Included within Study
Relationship between protection (subject matter/term/scope) and supply/economic development/growth/welfare
Green-tick.png
Relationship between creative process and protection - what motivates creators (e.g. attribution; control; remuneration; time allocation)?
Harmony of interest assumption between authors and publishers (creators and producers/investors)
Green-tick.png
Effects of protection on industry structure (e.g. oligopolies; competition; economics of superstars; business models; technology adoption)
Understanding consumption/use (e.g. determinants of unlawful behaviour; user-generated content; social media)
Green-tick.png
Coverage of Evidence Based Policies
Issue Included within Study
Nature and Scope of exclusive rights (hyperlinking/browsing; reproduction right)
Exceptions (distinguish innovation and public policy purposes; open-ended/closed list; commercial/non-commercial distinction)
Mass digitisation/orphan works (non-use; extended collective licensing)
Licensing and Business models (collecting societies; meta data; exchanges/hubs; windowing; crossborder availability)
Fair remuneration (levies; copyright contracts)
Enforcement (quantifying infringement; criminal sanctions; intermediary liability; graduated response; litigation and court data; commercial/non-commercial distinction; education and awareness)
Green-tick.png

Datasets

Sample size: 2
Level of aggregation: Markets for musicians
Period of material under study: 1994 to 2012