Digital Copyright and The Alternatives

This thesis compares the existing institution of digital copyright to possible alternatives. Four policy regimes are considered: (1) the status quo ‘weak copyright’ regime,
in which exclusive rights and piracy exist in parallel and are both economically significant; (2) a ‘strong copyright’ regime, in which Digital Rights Management (DRM) technologies and other forms of enforcement prevent piracy from being economically significant; (3) an ‘information anarchy’ regime, in which copyright is not a meaningful restraint on non-commercial copying and sharing of works; and (4) a ‘virtual market’ regime, in which file sharing is legalised, and public funding is used to pay artists and authors, based on decentralised measures of the the popularity and value produced by each copyright work (download counts, usage measurements, or voting). These regimes are studied for their technical feasibility, and compared for ethical and economic desirability. Di erent regimes may prevail at di erent times, and in di erent places and industry sectors, even if copyright law is the same. All of the regimes are feasible in at least some cases, but their practicality and relative merit turns out to vary surprisingly across copyright-based industries. The normative criteria that are applied include the levels of artificial scarcity that the regimes impose on information goods; the financial incentives they o er to information producers; the kinds of transaction costs they involve; the price of their technological and non-technological infrastructure; and, in the case of the virtual market, the taxation overheads that it would imply. Artificial scarcity costs are found to be very high, especially in the music industry: the social value of music would rise by 55–98% if copyright law were abolished, and 18–32% would be lost if present laws were fully enforced. But copyright does serve an important purpose in providing incentives and fair reward to authors, and this appears to probably outweigh the arguments for information anarchy. However it is shown that virtual markets could probably perform this function better than exclusive rightsbased copyright. Such public funding proposals do have overhead costs associated with taxation, however, and those are quantified. It is found that there is a strong case for experimenting with virtual markets in some copyright industries, particularly for music, books, and websites. It is also concluded that the international trend towards the ‘harmonisation’ of copyright laws has been a mistake: the best answer to disruptive and transformative technologies is to experiment with a broad range of regulatory responses, but international treaties on copyright have harmed this type of regulatory biodiversity
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