Working paper

Displacement and Complementary in the recorded music industry: evidence from France

Marc Ivaldi, Ambre Nicolle, Frank Verboven, and Jiekai Zhang

Abstract

Do new digital consumption channels of music depress sales in old physical ones, or are they complementary? To answer this question, we exploit product-level variations in prices of about 30 million sales and streams of over 300 thousand products observed weekly between 2014 and 2017 for the entire French market. At the track-level, we find that streaming displaces digital sales. Similarly, at the album level, digital sales displace physical sales. At the more aggregate artist-level, digital sales displace physical sales, but streaming implies a promotional effect on physical sales. This complementarity is driven by popular genres, i.e., Pop and Urban Music. Most of our findings are robust to whether we consider the hits or include the products that belong to the long tail.

Keywords

Music industry; Music consumption; Digitization;

JEL codes

  • D12: Consumer Economics: Empirical Analysis
  • L82: Entertainment • Media
  • O33: Technological Change: Choices and Consequences • Diffusion Processes

Reference

Marc Ivaldi, Ambre Nicolle, Frank Verboven, and Jiekai Zhang, Displacement and Complementary in the recorded music industry: evidence from France, TSE Working Paper, n. 21-1199, March 2021.

See also

Published in

TSE Working Paper, n. 21-1199, March 2021