Price Discrimination, Copyright Law, and Technological Innovation: Evidence from the Introduction of DVDs / Julie Holland Mortimer.

Format:

Book

Author/Creator:

Mortimer, Julie Holland.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w11676.

NBER working paper series no. w11676

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Price Discrimination, Copyright Law, and Technological Innovation

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2005.

Summary:

This paper examines the welfare effects of intellectual property protection, accounting for firms' optimal responses to legal environments and technological innovation. I examine firms' use of indirect price discrimination in response to U.S. copyright law, which effectively prevents direct price discrimination. Using data covering VHS and DVD movie distribution, I explain studios' optimal pricing strategies under U.S. copyright law, and determine optimal pricing strategies under E.U. copyright law, which allows for direct price discrimination. I analyze these optimal pricing strategies for both the existing VHS technology and the new digital DVD technology. I find that studios' use of indirect price discrimination under US copyright law benefits consumers and harms retailers. Optimal pricing under E.U. copyright law also tends to benefit studios and consumers. I also reanalyze these issues assuming continued DVD adoption.

Notes:

Print version record

October 2005.