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An Economic Model of Fair Use

Author

Listed:
  • Thomas J. Miceli

    (University of Connecticut)

  • Richard P. Adelstein

    (Wesleyan University)

Abstract

The doctrine of fair use allows limited copying of creative works based on the rationale that copyright holders would consent to such uses if bargaining were possible. This paper develops a formal model of fair use in an effort to derive the efficient legal standard for applying the doctrine. The model interprets copies and originals as differentiated products and defines fair use as a threshold separating permissible copying from infringement. The analysis highlights the role of technology in shaping the efficient standard. Discussion of several key cases illustrates the applicability of the model.

Suggested Citation

  • Thomas J. Miceli & Richard P. Adelstein, 2005. "An Economic Model of Fair Use," Working papers 2005-56, University of Connecticut, Department of Economics.
    • Handle: RePEc:uct:uconnp:2005-56
    Note: We wish to acknowledge the helpful comments of two referees.
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    File URL: https://media.economics.uconn.edu/working/2005-56.pdf
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    References listed on IDEAS

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    1. Benjamin Klein & Andres V. Lerner & Kevin M. Murphy, 2002. "The Economics of Copyright "Fair Use" in a Networked World," American Economic Review, American Economic Association, vol. 92(2), pages 205-208, May.
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    3. Depoorter, Ben & Parisi, Francesco, 2002. "Fair use and copyright protection: a price theory explanation," International Review of Law and Economics, Elsevier, vol. 21(4), pages 453-473, May.
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    5. Liebowitz, S J, 1985. "Copying and Indirect Appropriability: Photocopying of Journals," Journal of Political Economy, University of Chicago Press, vol. 93(5), pages 945-957, October.
    6. Cooter, Robert D & Rubinfeld, Daniel L, 1989. "Economic Analysis of Legal Disputes and Their Resolution," Journal of Economic Literature, American Economic Association, vol. 27(3), pages 1067-1097, September.
    7. Novos, Ian E & Waldman, Michael, 1984. "The Effects of Increased Copyright Protection: An Analytic Approach," Journal of Political Economy, University of Chicago Press, vol. 92(2), pages 236-246, April.
    8. Lucian Arye Bebchuk, 1984. "Litigation and Settlement under Imperfect Information," RAND Journal of Economics, The RAND Corporation, vol. 15(3), pages 404-415, Autumn.
    9. Adelstein, Richard P. & Peretz, Steven I., 1985. "The competition of technologies in markets for ideas: Copyright and fair use in evolutionary perspective," International Review of Law and Economics, Elsevier, vol. 5(2), pages 209-238, December.
    10. Posner, Richard A, 1992. "When Is Parody Fair Use?," The Journal of Legal Studies, University of Chicago Press, vol. 21(1), pages 67-78, January.
    11. Landes, William M & Posner, Richard A, 1989. "An Economic Analysis of Copyright Law," The Journal of Legal Studies, University of Chicago Press, vol. 18(2), pages 325-363, June.
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    Cited by:

    1. Gans, Joshua S., 2015. "Remix rights and negotiations over the use of copy-protected works," International Journal of Industrial Organization, Elsevier, vol. 41(C), pages 76-83.
    2. T. Randolph Beard & George S. Ford & Gilad Sorek & Lawrence J. Spiwak, 2018. "Piracy, Imitation, and Optimal Copyright Policy," Southern Economic Journal, John Wiley & Sons, vol. 84(3), pages 815-830, January.
    3. Yoon, Kiho, 2008. "An economic model of fair use: Comment," Information Economics and Policy, Elsevier, vol. 20(1), pages 67-74, March.
    4. Baker, Matthew J & Cunningham, Brendan M, 2006. "Court Decisions and Equity Markets: Estimating the Value of Copyright Protection," Journal of Law and Economics, University of Chicago Press, vol. 49(2), pages 567-596, October.
    5. Wendy J. Gordon, 2014. "The fair use doctrine: markets, market failure and rights of use," Chapters, in: Richard Watt (ed.), Handbook on the Economics of Copyright, chapter 4, pages 77-92, Edward Elgar Publishing.

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    More about this item

    Keywords

    Fair use; copyright law; technological improvement;
    All these keywords.

    JEL classification:

    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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