Exhaustion of Digital Goods: An Economic Perspective

Wolfgang Kerber ()
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Wolfgang Kerber: University of Marburg

MAGKS Papers on Economics from Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung)

Abstract: The "UsedSoft" decision of the Court of Justice of the European Union (CJEU) about the right of a buyer of a downloaded copy of a software to resell this copy triggered a controversial discussion about the applicability of the "exhaustion" rule (US: first-sale doctrine) to copyright-protected digital goods (as, e.g., also e-books). This paper offers, in a first step, a systematic analysis and assessment of economic reasonings that have been discussed in the literature about exhaustion, and applies this framework, in a second step, to downloaded digital creative works. An important result is that digitalisation, on one hand, changes considerably the benefits and costs of exhaustion, esp. in regard to the danger of jeopardizing the incentives for copyright owners. On the other hand, however, also the costs of imposing restrictions might be high and even increase in a digital economy. This leads to the conclusion that it is necessary to think seriously about the legal limits for the restrictions that copyright owners should be allowed to impose on their customers. However, these limits might be drawn also by other legal instruments than copyright exhaustion.

Keywords: Digital goods; copyright exhaustion; first-sale doctrine; post-sale restrictions (search for similar items in EconPapers)
JEL-codes: K20 L86 O34 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2016
New Economics Papers: this item is included in nep-cul, nep-ict, nep-ipr and nep-law
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Persistent link: https://EconPapers.repec.org/RePEc:mar:magkse:201623

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