Effect of illegal music sharing on legitimate international trade (1976–2006)

Determine the extent and direction of the effect that unauthorized copying and sharing of music recordings had on the volume of legitimate international trade in recorded music during the period up to and including 2006.

Background

The study analyzes longitudinal trade flows of recorded music (SITC Rev. 2 commodity 89832) from 1976 to 2006, modeling market formation via transitive closure in the international trade network. During this period, digital distribution and piracy emerged as significant forces potentially affecting trade volumes.

The author notes that while digital consumption was still a minority share by 2006, the impact of illegally copied and shared music on legitimate international trade volumes is unknown. Although robustness checks exclude the last two observation years to assess potential distortion, the precise causal effect of piracy on observed trade flows remains unresolved.