Peer-to-Peer File Sharing and Cultural Trade Protectionism

31 Pages Posted: 25 Mar 2011 Last revised: 9 May 2017

See all articles by Andres Hervas-Drane

Andres Hervas-Drane

City University London - Sir John Cass Business School

Eli M. Noam

Columbia Business School - Finance and Economics; Columbia Business School - Institute for Tele Information

Date Written: May 5, 2017

Abstract

We examine the Internet's impact on the cross-border distribution of cultural goods and assess its implications for cultural policy and cultural diversity. We present a stylized model of a two-country economy where governments are endowed with political preferences over the consumption of domestic content and enact import barriers and subsidies to protect it. We introduce peer-to-peer file sharing as a distinct distribution channel enabled by the Internet that provides access to all media products at a low cost. We report two main findings. First, the Internet renders legacy cultural policy inefficient, and the elimination of import barriers and the reduction of subsidized production can be desirable even when governments exhibit paternalistic preferences favoring the consumption of domestic content. And second, even though the Internet increases cultural diversity within countries, it can also reduce diversity across them.

Keywords: Media Industry, Digital Distribution, Cultural Policy, Cultural Diversity

JEL Classification: F12, L16, L52, L82, L86

Suggested Citation

Hervas-Drane, Andres and Noam, Eli M., Peer-to-Peer File Sharing and Cultural Trade Protectionism (May 5, 2017). Available at SSRN: https://ssrn.com/abstract=1793131 or http://dx.doi.org/10.2139/ssrn.1793131

Andres Hervas-Drane (Contact Author)

City University London - Sir John Cass Business School ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom

Eli M. Noam

Columbia Business School - Finance and Economics ( email )

3022 Broadway
New York, NY 10027
United States

Columbia Business School - Institute for Tele Information ( email )

3022 Broadway
New York, NY 10027
United States

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