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Saturday, November 26th 2005

Economics of P2P

A study of the economic depression of file sharing music by a Harvard PhD student finds that illegal sharing harms sales of music of the most popular musicians but increases exposure and sales for less successful artists.

File sharing is reducing the probability that any act is able to sell millions of records, and if the success of the mega-star artists is what drives the investment in new acts, it might reduce the incentive to invest in new talent. This is, at its heart, an empirical question which is left to future work.

H/T to Slashdot

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