Pricing Information Goods in the Presence of Copying

Paul Belleflamme ()

No 463, Working Papers from Queen Mary, University of London, Department of Economics

Abstract: The effects of (private, small-scale) copying on the pricing behavior of producers of information goods are studied within a unified model à la Mussa-Rosen (1978). When the copying technology involves a marginal cost and no fixed cost, producers act independently. In this simple framework, we highlight the trade-off between ex ante and ex post efficiency considerations (how to provide the right incentives to create whilst limiting monopoly distortions?). When the copying technology involves a fixed cost and no marginal cost, pricing decisions are interdependent. We investigate the strategic pricing game by focussing on some significant symmetric Nash equilibria.

Keywords: Information goods; Piracy; Copyright; Pricing (search for similar items in EconPapers)
JEL-codes: L13 L82 L86 K11 O34 (search for similar items in EconPapers)
Date: 2002-09
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