This study was in no way supported by the Australian Recorded Industry Association (ARIA) or any other industry organisation. I am grateful to the research assistance of Kamilla Scott-Mckenzie. I am also grateful to two anonymous referees and the editor for helpful suggestions on the original version. All remaining errors are my own.
ILLEGAL MUSIC DOWNLOADING AND ITS IMPACT ON LEGITIMATE SALES: AUSTRALIAN EMPIRICAL EVIDENCE
Article first published online: 17 DEC 2009
© 2009 The Author. Journal compilation © 2009 Blackwell Publishing Ltd/University of Adelaide and Flinders University
Australian Economic Papers
Volume 48, Issue 4, pages 296–307, December 2009
How to Cite
McKENZIE, J. (2009), ILLEGAL MUSIC DOWNLOADING AND ITS IMPACT ON LEGITIMATE SALES: AUSTRALIAN EMPIRICAL EVIDENCE. Australian Economic Papers, 48: 296–307. doi: 10.1111/j.1467-8454.2009.00377.x
- Issue published online: 17 DEC 2009
- Article first published online: 17 DEC 2009
This paper explores illegal music file-sharing activity and its effect on Australian sales of singles in the physical and digital retail markets. Using fifteen weeks of Australian Recording Industry Association weekly chart rankings of physical and digital sales, combined with a proxy for download activity derived from the popular peer-to-peer (P2P) network Limewire, the evidence suggests no discernible impact of download activity on legitimate sales. Whilst significant negative correlation between chart rank and download activity is observed in the digital market, once download endogeneity is purged from the model and song heterogeneity is controlled for no significant relationship remains.