Displacement Effects of Public Libraries

39 Pages Posted: 7 Dec 2017 Last revised: 25 May 2021

See all articles by Kyogo Kanazawa

Kyogo Kanazawa

Graduate School of Economics, The University of Tokyo

Kohei Kawaguchi

Hong Kong University of Science and Technology

Date Written: May 25, 2021

Abstract

If free lending in public libraries is displacing sales in bookstores, some compensation may be needed to maintain incentives for authors to create new works. To determine whether this is indeed the case, we created a novel dataset that integrated bookstore sales data with public library copy data in Japan and quantified the displacement effects of public libraries. Controls for title-municipality, months-after-publication, and municipality-month-specific unobserved heterogeneity were introduced. The study found that a library copy displaced sales of the title in the municipality by approximately 0.24 copies per month for the top 1/6 popular books and 0.52 copies for bestsellers. Various robustness checks, including instrumental variable estimation, were consistent with the baseline results; thus, the study confirmed displacement effects for popular books.

Keywords: Public lending right, Library, Book, Displacement effects, Japan.

JEL Classification: K11, L30, L67, O34, O38

Suggested Citation

Kanazawa, Kyogo and Kawaguchi, Kohei, Displacement Effects of Public Libraries (May 25, 2021). Available at SSRN: https://ssrn.com/abstract=3082016 or http://dx.doi.org/10.2139/ssrn.3082016

Kyogo Kanazawa

Graduate School of Economics, The University of Tokyo ( email )

Yayoi 1-1-1
Bunkyo-ku
Tokyo, Tokyo 113-8657
Japan

Kohei Kawaguchi (Contact Author)

Hong Kong University of Science and Technology ( email )

6070 LSK Building, HKUST
Clear Water Bay
Kowloon
Hong Kong

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