The Effect of File Sharing on Record Sales: An Empirical Analysis

From the abstract for a paper by Felix Oberholzer-Gee and Koleman Strumpf, published in The University of Chicago’s Journal of Political Economy:

We match an extensive sample of downloads to U.S. sales data for a large number of albums. To establish causality, we instrument for downloads using data on international school holidays. Downloads have an effect on sales that is statistically indistinguishable from zero. Our estimates are inconsistent with claims that file sharing is the primary reason for the decline in music sales during our study period.

(Thanks to DF reader Carl Forde.)

★ Tuesday, 13 February 2007