Literature Review on Academic Studies on the Effect of File-Sharing on the Recorded Music Industry

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  • Essay: Grassmuck, Volker Ralf, Academic Studies on the Effect of File-Sharing on the Recorded Music Industry: A Literature Review (May 14, 2010).

Available at SSRN: http://ssrn.com/abstract=1749579 or http://dx.doi.org/10.2139/ssrn.1749579


Abstract

"Is file-sharing responsible for the slump in recorded music sales or does it create demand? The empirical research literature is inconclusive. What has clearly emerged is that there are a number of different dynamics at work, yielding a mixed result with respect to album sales, a likely positive result for the music industry as a whole through gains in concert and merchandising revenues, and a clearly positive effect on social welfare through improved market chances for non-star music, greater cultural diversity and increased consumer surplus. While the nearly eighty empirical studies under review cannot support allegations by IFPI that illegal file-sharing has been a major factor in the decline in music sales, they do show trends in the music sector and raise questions about the economic rationality of the current copyright regime."