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The Economics of Ideas and the Ideas of Economists

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  • William R. Johnson

Abstract

On college campuses across the country and on millions of home computers, too, young adults download from each other digital files containing recorded music and films for their entertainment. The owners of that copyrighted material pursue the downloaders with legal action as well as the software services that facilitate it. Napster’s existence as a free file-sharing internet site was shut down in 2001, and the Supreme Court has recently ruled that a successor file-sharing service, Grokster, engaged in copyright infringement by providing an easy way for individuals to exchange files. The amount of filesharing activity is not trivial; Paul Romer (2002) estimates that Napster users were downloading at the rate of 1.5 billion downloads per month before Napster was shut down and that the consumer surplus generated by downloading roughly equaled the revenues of the recording industry.

Suggested Citation

  • William R. Johnson, 2005. "The Economics of Ideas and the Ideas of Economists," Virginia Economics Online Papers 368, University of Virginia, Department of Economics.
    • Handle: RePEc:vir:virpap:368
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    References listed on IDEAS

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    1. Kremer, Michael R., 1998. "Patent Buyouts: A Mechanism for Encouraging Innovation," Scholarly Articles 3693705, Harvard University Department of Economics.
    2. Shavell, Steven & van Ypersele, Tanguy, 2001. "Rewards versus Intellectual Property Rights," Journal of Law and Economics, University of Chicago Press, vol. 44(2), pages 525-547, October.
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    4. Connolly, Marie & Krueger, Alan B., 2006. "Rockonomics: The Economics of Popular Music," Handbook of the Economics of Art and Culture, in: V.A. Ginsburgh & D. Throsby (ed.), Handbook of the Economics of Art and Culture, edition 1, volume 1, chapter 20, pages 667-719, Elsevier.
    5. Michele Boldrin & David K Levine, 2005. "Intellectual Property and the Efficient Allocation of Surplus from Creation," Levine's Working Paper Archive 618897000000000925, David K. Levine.
    6. Michele Boldrin & David Levine, 2002. "The Case Against Intellectual Property," American Economic Review, American Economic Association, vol. 92(2), pages 209-212, May.
    7. B. Zorina Khan & Kenneth L. Sokoloff, 2001. "The Early Development of Intellectual Property Institutions in the United States," Journal of Economic Perspectives, American Economic Association, vol. 15(3), pages 233-246, Summer.
    8. Johnson, William R, 1985. "The Economics of Copying," Journal of Political Economy, University of Chicago Press, vol. 93(1), pages 158-174, February.
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    More about this item

    Keywords

    Intellectual Property; property rights; creativity;
    All these keywords.

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • Z11 - Other Special Topics - - Cultural Economics - - - Economics of the Arts and Literature

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