Standard economics provides a well-understood framework of the competitive determinants of market prices that is now widely accepted for antitrust analysis. In “two-sidedmarkets,” where firms supply products demanded by two interrelated groups of consumers, these competitive forces operate...

The recent success of file-sharing technologies such as Napster has highlighted the economic question of whether copying increases or decreases the market value of copyrighted works. Contrary to Michele Boldrin and David K. Levine (2002), we show that Napster-type services are likely to reduce...