EconPapers    
Economics at your fingertips  
 

The Economics of Copyright Levies on Hardware

Patrick Legros and Victor A. Ginsburgh ()

Working Papers ECARES from ULB -- Universite Libre de Bruxelles

Abstract: We provide an economic analysis of the static and dynamic effects of copyright levies on hardware. Contrary to copyright levies on supports such as tapes, CDs or DVDs, whose main use is to copy, levies on hardware do not modify the propensity of consumers to use 'illegal' content. They decrease both levels of 'legal' and 'shared' contents, leading to a decrease in the revenues from legal sales for copyright holders. The levies could compensate for the decrease but this would require copyright holders to receive a large share of the levies. Hence from a static perspective, levies on hardware are likely to fail achieving their goal of increasing the financial flow to copyright holders. We also consider a dynamic version of the model where artists are differentiated by reputation and where reputation and sales covary (more reputation leads to higher sales and higher sales to more reputation). Then, even if high reputation artists benefit from higher levies, lower reputation artists are hurt. Finally, we show that when content providers have market power and can choose between offering content at a unit price or through a subscription service, incentives to implement subscription models are decreasing in the level of levies on hardware, despite the fact that subscription services may eliminate piracy.

New Economics Papers: this item is included in nep-com, nep-cul and nep-ind
Date: 2013
References: Add references at CitEc
Citations View citations in EconPapers (1) Track citations by RSS feed

Published by:

Downloads: (external link)
https://dipot.ulb.ac.be/dspace/bitstream/2013/8235 ... %20on%20Hardware.pdf (application/pdf)

Related works:
Working Paper: The economics of copyright levies on hardware
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eca:wpaper:2013/82356

Ordering information: This working paper can be ordered from
http://hdl.handle.ne ... ulb.ac.be:2013/82356

Access Statistics for this paper

More papers in Working Papers ECARES from ULB -- Universite Libre de Bruxelles
Contact information at EDIRC.
Series data maintained by Benoit Pauwels ().

 
Page updated 2014-12-20
Handle: RePEc:eca:wpaper:2013/82356