Advertisement

Impact of Copyright Protection on Re-creation of Digital Contents When Expression and Idea Are Divisible

  • Takuya NakaizumiEmail author
Chapter

Abstract

We consider the case in which the expression and the idea are completely divisible and copyright protection cannot be applied to very closely substitutable derivative work. Even if the ideas of these works are very similar, the substitute is regarded as an independent work, and not as a copyright infringement. Therefore, it is possible to supply closely substitutable goods based on similar ideas. Thus, the monopoly rent of the copyright holders might decrease, so they face the risk of failing to recover the initial cost. Assuming Bertrand competition with zero marginal cost, considering the nature of digital contents, we show that imitators have no incentive to enter the market in vertical product differentiation except in the case of a sufficiently high quality of imitation. Even if they can enter the product-differentiated market, they do not compete and divide the market to produce differentiated works. Thus, the original producer’s monopolistic profit is maintained under the general copyright system.

References

  1. Anderson, S. 1987. Spatial competition and price leadership. International Journal of Industrial Organization 5: 369–398.CrossRefGoogle Scholar
  2. Arai, Y. 2018. Intellectual property right protection in the software market. Economics of Innovation and New Technology 27(1): 1–13.CrossRefGoogle Scholar
  3. D’Aspremont, C., J. Jaskold Gabszewicz, and J.F. Thisse. 1979. On Hotelling’s stability in competition. Econometrica 47: 1145–1150.CrossRefGoogle Scholar
  4. Fleckinger, Pierre and Thierry Lafay. 2003. Horizontal differentiation and price competition with sequential entry. mimeoGoogle Scholar
  5. Hotelling H. 1929. Stability in competition. The Economic Journal 39: 41–57.CrossRefGoogle Scholar
  6. Loertscher, Simon and Gerd Muehlheusser. 2011. Sequential location games. The RAND Journal of Economics 42(4): 639–663 (Winter 2011).CrossRefGoogle Scholar
  7. Younies, Hassan, and H.A. Eiselt. 2011. Sequential Location Models H, 163–178. Foundations of Location Analysis Springer: A. Eiselt and Vladimir Marianov Edited.Google Scholar

Copyright information

© Springer Nature Singapore Pte Ltd. 2019

Authors and Affiliations

  1. 1.Kanto Gakuin UniversityYokohamaJapan

Personalised recommendations