The “Blurred Lines” of Copyright Infringement

Alberto Galasso

Journal of Law and Economics, 2025, vol. 68, issue 4, 805 - 843

Abstract: This paper studies the creative process in a model in which the level and direction of artistic effort are affected by judicial copyright enforcement. The analysis compares the performance of common sanctioning rules employed by US courts in infringement cases and provides an economic microfoundation for the independent creation defense in copyright law. Using a mechanism-design approach, the paper highlights the benefits of complementing copyright litigation with a system of compulsory licensing. A calibration of the model that fits a leading music infringement case suggests that the damages awarded by courts may stifle creativity, as they substantially exceed those required to deter excessive entry and copying.

Date: 2025
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