This note aims at providing some economic rationale for (against) the use of copyright protection mechanisms in markets where the cost of copying and distributing copyrightable goods is fairly small. I show that the good can be efficiently provided without the need of any copyright protection. However, efficiency comes at the cost of reducing the agent's equilibrium rent which suggests that the rationale behind copyright protection may obey rent-extraction rather than incentives-for-provision arguments.
JEL Classiffication: L1, L82, L86, O34.
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Thursday, August 2, 2007
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