'Forever minus a day? Some Theory and Empirics of Optimal Copyright' - Rufus Pollock

Link to PDF version of 'Forever minus a day? Some Theory and Empirics of Optimal Copyright' by Rufus Pollock


"The optimal level for copyright has been a matter for extensive debate over the last decade. This paper contributes several new results on this issue divided into two parts. In the first, a parsimonious theoretical model is used to prove several novel propositions about the optimal level of protection. Specifically, we demonstrate that (a) optimal copyright falls as the costs of production go down (for example as a result of digitization) and that (b) the optimal level of copyright will, in general, fall over time. The second part of the paper focuses on the specific case of copyright term. Using a simple model we characterise optimal term as a function of a few key parameters. We estimate this function using a combination of new and existing data on recordings and books and find an optimal term of around fourteen years. This is substantially shorter than any current copyright term and implies that existing copyright terms are non-optimal."


" In particular, we show that (a) optimal protection decreases as the cost of production falls (and vice versa); and (b) the level of optimal protection, in general, declines over time

  • Implication of (a) is that ICT progress has decreased cost of production for originals of most (C)-able subject matter; also, cost of distribution drops as internet uptake grows => we should reduce protection for (C) subject matter
    • BUT - same forces also make production and distributions of copies far cheaper ... which may itself necessitate increased protection (MH: interesting tension. Does this invalidate / fatally wound this theory? Certainly these arguments don't amount to much if we ignore the other side)
  • Implication of (b): "In most systems of law, it is extremely difficult to remove or diminish rights once they have been granted. Thus, once a given level of protection has been awarded it will be all but impossible to reduce it. However, according to our result, the optimal level of protection will decline over time. This being the case, a prudent policy-maker will need to set initial level of protection not at its optimum level but below it - perhaps well below it"

A brief note on copyright law



The relation of the production and welfare maximising levels of protection

Production costs and the optimal level of protection

Optimal copyright in a dynamic setting

Optimal copyright term

The discount rate

The rate of cultural decay

The ratio of average deadweight-loss to welfare under copyright from new works

Optimal copyright term: point estimates

A point estimate for optimal copyright term

Robustness checks