In the paper we introduce technological comparative advantage and transaction costs into the Heckscher-Olin (HO) model and refine the HO theorem, the Stolper-Samuelson theorem, the Rybczynski theorem, and factor equalization theorem. The refined core theorems can be used to accommodate recent empirical evidence that is at odds with the core theorems.

Using comprehensive digital sales data by time and vintage on the US, Canada, and 15 European countries, we infer the evolution of music vintage quality, finding that vintage service flow has increased since 2000. We explain the result with unpredictability of music quality at the time of investment along with growing releases. Evidence shows a) products with modest prospects at release from ar...

Ten years after the fall of Napster, digital piracy remains an issue for e-commerce firms. While scholars treat digital piracy as a behaviour that needs to be prevented or punished, the user’s decision about how to acquire a digital product involves more than the piracy option, yet the decision between piracy and legal alternatives has received limited attention. Moreover, existing models of pi...

The doctrine of fair use allows unauthorized copying of original works of art, music, and literature for limited purposes like criticism, research, and education, based on the rationale that copyright holders would consent to such uses if bargaining were possible. This paper develops the first formal analysis of fair use in an effort to derive the efficient legal standard for applying the doctr...

The phenomenal growth of Internet service provider YouTube has already raised the company to legendary status. When Google acquired the company in 2006, YouTube’s founders became billionaires. But YouTube’s future success is contingent upon its ability to avoid copyright liability lawsuits that destroyed an earlier generation of online firms like Napster and Grokster. This paper describes YouTu...

Peer-to-Peer (P2P) hat sich binnen kurzer Zeit zu einem der meistdiskutierten Begriffe in der jüngeren Geschichte der Informationstechnologie herausgebildet. Insbesondere die millionenfach frequentierten Musiktauschbörsen wie etwa Napster haben P2P zu einem aus ökonomischer, technologischer und juristischer Perspektive kontrovers diskutierten Phänomen gemacht. File-Sharing à la Napster ist dabe...

Using weekly music charts data in 10 countries over the period 1990–2015, we analyze whether digitization leads to a trend of homogenization content or conversely greater acoustic disparity. We split era four periods that correspond new emblematic distribution models (Napster, iTunes, YouTube, Spotify). Our main result is while diversity decreased during iTunes and YouTube periods, begins with ...