Piracy in the Music Industry: A Two-Sided Market Approach

• Project/Area Number: 19K01649
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Review Section: Basic Section 07040:Economic policy-related
• Research Institution: Nagoya University
• Principal Investigator: マルティン・ロドリゲス マリア 名古屋大学, 経済学研究科, 講師 (70795012)
• Co-Investigator(Kenkyū-buntansha): マルシャレツ ダニエル 国際基督教大学, 教養学部, 助教 (50747805)
• Project Period (FY): 2019-04-01 – 2023-03-31
• Project Status: Discontinued (Fiscal Year 2022)
• Budget Amount: ¥4,160,000 (Direct Cost: ¥3,200,000、Indirect Cost: ¥960,000); Fiscal Year 2022: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000); Fiscal Year 2021: ¥780,000 (Direct Cost: ¥600,000、Indirect Cost: ¥180,000); Fiscal Year 2020: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000); Fiscal Year 2019: ¥1,560,000 (Direct Cost: ¥1,200,000、Indirect Cost: ¥360,000)
• Keywords: piracy / price discrimination / bargaining / Two-sided markets / Piracy / Price discrimination / Heterogeneity / Platforms / Diffusion / Heterogeneous artists / Bargaining / Music Inudstry / Two-sided Market / Transfers

Outline of Research at the Start

We find the equilibrium for any parameter values, which determines the conditions for a larger variety of qualities and the emergence of legal markets to happen. Our welfare analysis clarifies the sign and magnitude of the changes caused by piracy on the well-being of the different groups of agents.

Outline of Annual Research Achievements

Platforms' paywalls fuels piracy's resurgence. Within a theoretical framework, we explore outcomes for creators of varying degrees of fame, comparing copyright and piracy scenarios to identify winners and losers.
Our research reveals that piracy can eliminate the trade-off for lesser-known creators. They no longer have to sacrifice their popularity to reach a broader audience. Opting to share their work on for-profit platforms becomes a dominant strategy.
However, the overall impact on welfare is not straightforward. While piracy allows more consumers to participate, it also changes the dynamics of bargaining power between less famous creators and the for-profit platform. Additionally, the shifts in equilibrium prices could lead to substitution effects.

Research Products

• [Journal Article] Co-investment deterrence (2022)
  • Author(s): Angel L. Lopez, Anton-Giulio Manganelli, Maria Martin-Rodriguez
  • Journal Title: Economics Letters Volume: 211 Pages: 110263-110263
  • DOI: 10.1016/j.econlet.2021.110263
  • Peer Reviewed / Open Access / Int'l Joint Research
• [Presentation] Stable Networks with Bargaining and Heterogeneous Costs (2022)
  • Author(s): Maria Martin Rodriguez
  • Organizer: IDEC seminar, Hiroshima University
• [Presentation] Stable Networks with Bargaining and Heterogeneous Costs (2022)
  • Author(s): Maria Martin Rodriguez
  • Organizer: Nagoya University Workshop
• [Presentation] Stable Networks with Bargaining and Heterogeneous Costs (2021)
  • Author(s): Maria Martin-Rodriguez
  • Organizer: Hiroshima University
• [Presentation] Stable Networks with Bargaining and Heterogeneous Costs (2021)
  • Author(s): Maria Martin Rodriguez
  • Organizer: Microeconomics Workshop at Tokyo University
• [Presentation] Stable Networks with Bargaining and Heterogeneous Costs (2020)
  • Author(s): Maria Martin Rodriguez
  • Organizer: Microeconomics Workshop at Keio University
• [Presentation] Stable Networks with Bargaining and Heterogeneous Costs (2020)
  • Author(s): Maria Martin Rodriguez
  • Organizer: Microeconomics Workshop, Keio University
• [Presentation] Strategic Formation of Bargaining Networks with Heterogeneous Costs (2019)
  • Author(s): Maria Martin Rodriguez
  • Organizer: APIOS
  • Int'l Joint Research
• [Funded Workshop] SAET (2022)