The Effect of Recording Industry Lawsuits on the Market for Recorded Music

Ryan Thomas Holt


The origination and rapid growth in popularity of file sharing technology at the end of the twentieth century created the potential for a fundamental market shift for any private good that is reduced to information. Through a new exploration of this recent phenomenon within the context of peer-to-peer file sharing technology for music downloads, this article examines the relative importance of various economic factors in determining the national level of file sharing. After employing basic theoretical models and econometric methods, the author finds that file sharing behavior is most responsive to the number of lawsuits brought against consumers, the relative value and amount of leisure time for consumers, household disposable income, and the prevalence of computer virus threats among file-sharing program users. These new findings are discussed in the context of microeconomic expectations that predict a different set of empirical trends in file sharing technology.


File Sharing; Public Goods; Information Goods; RIAA Lawsuits

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