cover image: The impact of music downloads and P2P file-sharing on the purchase of music

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The impact of music downloads and P2P file-sharing on the purchase of music

9 Aug 2007

Important issues regarding perfect substitution include whether (i) the quality of music between the original and the substituted copy is the same, (ii) the information attached to the original and the downloaded file is the same, and (iii) the ability to listen to the downloaded file should be available in as many locations as the original. [...] Contribution of this research paper in terms of scope of the data and analysis This research paper adds to the discussion on the extent and effects of music downloading and P2P file-sharing by using microeconomic survey data and by extending the analysis to account for a wider range of relevant variables/factors underlying music purchasing. [...] To address this, we use two common types of data transformations in the case of OLS estimations; (i) taking the square root of the values of the dependent variable and (ii) taking the natural log. [...] In relation to Hypothesis 2a, which states that there is a positive relationship between the price of CDs and number of songs downloaded from P2P networks, we regress the price of CD albums onto the number of reported purchases of paid electronically- delivered music tracks rather than onto CD purchases (this is an indirect way of measuring the cross-price elasticity of the two music markets). [...] Results based on the relevant count data (using the natural log of the count data) are included in Appendices 4 and 5. In the case of estimations based on the subset of P2P file-sharers, we use the natural log of the number of free songs, e.g.
economics science and technology research media digital divide mathematics music prices music industry statistics demand economic sector regression mean errors and residuals economy, business and finance ols endogeneity (econometrics) ordinary least squares instrumental variables estimation coefficient of determination heteroscedasticity variance negative binomial negative binomial distribution file sharing music and the internet downloading of data music publishing file-sharing peer-to-peer architecture (computer networks) errors-in-variables models rip

Authors

Andersen, Birgitte

Pages
61
Published in
Canada

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