Does Copyright Law Matter? An Empirical Analysis of Creators’ Earnings

37 Pages Posted: 21 May 2012

Date Written: May 21, 2012

Abstract

Copyright matters to creators. The claim has pervaded copyright jurisprudence and economic analysis for over 200 years. Creative production would not take place without the incentive of artificial scarcity that copyright law provides. Authors and artists would starve.

Professor Breyer (as he then was) wryly remarked in The Uneasy Case (1970, at 324): “It is, of course, conceivable that some prospective Miltons have given up writing after learning that Milton’s daughter was destitute, but it is unlikely.”

This article surveys what the empirical data actually say about the way creators live. The argument proceeds in three steps.

First, the relationship of copyright and contract law is conceptualised, starting from an analysis of contracts concluded in a pre-copyright environment (Milton 1667; Schiller 1791). The extent of statutory dependence is then scrutinised for typical sources of earnings of creators at the beginning of the 21st century.

Second, empirical evidence on creator earnings in developed cultural markets is reviewed. It is shown that the bottom 50% of composers/songwriters earn less than 5% of the total income of the population of composers/songwriters; the bottom 50% of literary authors earn under 10% of total income; the bottom 50% of visual creators earn about 10% of total income. Median incomes are close to the poverty line. The top 10% of creators receive a disproportionally large share (visual creators: 45% of total income; literary authors: 65% of total income; composers/songwriters: 80% of total income).

Finally, possible interpretations of these data in the light of Landes & Posner’s “harmony of interest” assumption (An Economic Analysis of Copyright Law, 1989) are considered and rejected. Creators (authors, performers) and investors (publishers, producers) have conflicting interests, and copyright law does not harmonise but exacerbate these.

The article concludes that copyright law empirically fails to secure the financial independence of creators. If it works as an incentive for some, this may be based on a systematic cognitive mistake.

Keywords: copyright, artists' earnings

JEL Classification: O34, K11

Suggested Citation

Kretschmer, Martin, Does Copyright Law Matter? An Empirical Analysis of Creators’ Earnings (May 21, 2012). Available at SSRN: https://ssrn.com/abstract=2063735 or http://dx.doi.org/10.2139/ssrn.2063735

Martin Kretschmer (Contact Author)

University of Glasgow ( email )

10 The Square
Glasgow, G12 8QQ
United Kingdom

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