The Price of Everything

by Eduardo Porter

  144-148 The Case for Bookaneering: Paul McCartney’s quote is found in David Bennahum, The Beatles: After the Break-up: In Their Own Words (London: Omnibus Press, 1991), p. 19. The tale about the origins of copyright in Britain and its controversial application in the United States is drawn from Hal Varian, “Copying and Copyright,” Journal of Economic Perspectives, Vol. 19, No. 2, Spring 2005, pp. 121-138; Robert Spoo, “Ezra Pound’s Copyright Statute: Perpetual Rights and the Problem of Heirs,” UCLA Law Review, Vol. 56, 2009; Charles C. Mann, “The Heavenly Jukebox,” Atlantic Monthly, September 2000; Ezra Pound, “Copyright and Tariff,” New Age, Vol. 23, October 13, 1918, p. 363. Paulo Coelho’s fondness for sharing his books online is discussed in Torrent Freak, “Best-Selling Author Turns Piracy into Profit,” May 12, 2008 (torrentfreak.com/best-selling-author-turns-piracy-into-profit-080512/, accessed 07/18/2010). Analysis of the impact of file sharing on the market for music draws from Rafael Rob and Joel Waldfogel, “Piracy on the High C’s: Music Downloading, Sales Displacement, and Social Welfare in a Sample of College Students,” Journal of Law and Economics, Vol. 49, No. 1, April 2006, pp. 29-62; Alejandro Zentner, “Measuring the Effect of File Sharing on Music Purchases,” Journal of Law and Economics, Vol. 49, No. 1, April 2006; Martin Peitz and Patrick Waelbroeck, “The Effect of Internet Piracy on Music Sales: Cross-Section Evidence,” Review of Economic Research on Copyright Issues, 2004, Vol. 1, No. 2, 2004, pp. 71-79; Sudip Bhattacharjee, Ram Gopal, Kaveepan Lertwachara, James Marsden, and Rahul Telang, “The Effect of Digital Sharing Technologies on Music Markets,” Management Science, Vol. 53, No. 9, September 2007, pp. 1359-1374. The analysis of the impact of music downloads on bands that haven’t yet made the A-list is drawn from Alan Krueger, “The Economics of Real Superstars: The Market for Rock Concerts in the Material World,” Journal of Labor Economics, Vol. 23, January 2005, pp. 1-30; Marie Connolly and Alan Krueger, “Rockonomics: The Economics of Popular Music,” NBER Working Paper, April 2005; “The State of Online Music: Ten Years After Napster,” Pew Internet and American Life Project, June 15, 2009, pp. 13-14; Greg Sandoval, “Trent Reznor: Why Won’t People Pay $5?,” CNET News, January 10, 2008 (at news.cnet.com/8301-10784_3-9847788-7.html. , accessed 07/18/2010).

  149-152 Stealing Sneakers: Stan Liebowitz’s analysis of the economics of copyright is found on his Web site at the University of Texas at Dallas (at www.utdallas.edu/~liebowit/, accessed 07/18/2010); Stan Liebowitz, “Testing File-Sharing’s Impact by Examining Record Sales in Cities,” University of Texas at Dallas School of Management, Department of Finance and Managerial Economics Working Paper, April 2006; Stan Liebowitz, “Economists’ Topsy-Turvy View of Piracy,” Review of Economic Research on Copyright Issues, Vol. 2, No. 1, 2005, pp. 5-17. Artists’ reactions to Google’s request for free art is found in Andrew Adam Newman, “Use Their Work Free? Some Artists Say No to Google,” New York Times, June 15, 2009. The story about free lawyers is in Elie Mystal, “It’s Come to This: Unpaid Internships for Lawyers with One-Three Years Experience,” Above the Law, September 30, 2009 (abovethelaw.com/2009/09/its-come-to-this-unpaid-internships-for-lawyers-with-one-three-years-experience/, accessed 07/18/2010). Hal Varian’s suggestion on how newspapers can make money is in Hal R. Varian, “Versioning Information Goods,” University of California Berkeley Working Paper, March 13, 1997. The online pricing strategy of the Newport Daily News in Rhode Island is described in Joseph Tartakoff, “Taking the Plunge: How Newspaper Sites That Charge Are Faring,” Paid Content. org, September 2, 2009 (paidcontent.org/article/419-taking-the-plunge-how-newspaper-sites-that-charge-are-faring/, accessed on 08/16/2010).

  152-154 Where Information Goes to Die: Data on music sales in France is in IFPI, “Digital Music Report,” 2009. Experts’ trust in the inevitable demise of copyright is drawn from “The Future of the Internet III,” Pew Internet and American Life Project, December 14, 2008. Tales about the battle against the piracy of sheet music in the nineteenth century are found in Adrian Johns, Piracy: The Intellectual Property Wars from Gutenberg to Gates (Chicago: University of Chicago Press, 2009), p. 329.

  155-162 The Price of Culture: The data on the spread of democracy is drawn from Freedom House, “Democracy’s Century: A Survey of Global Political Change in the 20th Century,” 1999 (http://www.freedomhouse.org/template.cfm?page=70&release=75, accessed 08/09/2010). The data on vote buying in Thailand and São Tomé and Príncipe comes from Frederic Charles Schaffer, “Vote Buying in East Asia,” Transparency International Corruption Report, 2004; Pedro Vicente, “Is Vote Buying Effective? Evidence from a Field Experiment in West Africa,” Oxford University Working Paper, 2007; and Pedro Vicente, “Does Oil Corrupt? Evidence from a Natural Experiment in West Africa,” Oxford University Working Paper, 2006. Tales about vote buying in Britain and the United States in the nineteenth century come from E. Anthony Smith, “Bribery and Disfranchisement: Wallingford Elections, 1820- 1832,” English Historical Review, Vol. 75, No. 297, October 1960, pp. 618-630; Gary Cox and J. Morgan Kousser, “Turnout and Rural Corruption: New York as a Test Case,” American Journal of Political Science, Vol. 25, No. 4, 1981; and David Kirkpatrick, “Does Corporate Money Lead to Political Corruption?,” New York Times, January 23, 2010. The data on campaign spending in the 2008 presidential election in the United States comes from the Center for Responsive Politics (www.opensecrets.org/pres08/index.php, accessed 07/18/2010); and Federal Election Commission, 2008 Official Presidential General Election Results (www.fec.gov/pubrec/fe2008/2008presgeresults.pdf, accessed 07/18/2010). The discussion of the limited returns to contemporary campaign spending is in Steven Levitt, “Using Repeat Challengers to Estimate the Effects of Campaign Spending on Electoral Outcomes in the U.S. House,” Journal of Political Economy, Vol. 102, 1994, pp. 777-798. The comparison between corruption and lobbying draws from Bard Harstad and Jakob Svensson, “Bribes, Lobbying and Development,” CEPR Discussion Paper, 2006; the Center for Responsive Politics ( www.opensecrets.org/lobby/index.php, accessed 07/18/2010); the Center for Responsive Politics, “Banking on Connections,” June 3, 2010; Erich Lichtblau and Edward Wyatt, “Financial Overhaul Bill Poses Big Test for Lobbyists,” New York Times, May 22, 2010; Henrik Kleven, Martin Knudsen, Claus Kreiner, Søren Pedersen, and Emmanuel Saez, “Unwilling or Unable to Cheat? Evidence from a Randomized Tax Audit Experiment in Denmark,” NBER Working Paper, February 2010; Nauro Campos and Francesco Giovannoni, “Lobbying, Corruption and Other Banes,” CEPR Discussion Paper, 2008; “Daimler Agrees to Pay $185m After Admitting Bribery,” BBC News, April 1, 2010 (news.bbc.co.uk/go/pr/fr/-/2/hi/business/8600241.stm, accessed 07/18/2010); and Politische Datensbank ( www.parteispenden.unklarheiten.de/?seite=datenbank_show_k&db_id=25&kat=3&sortierung=start, accessed 07/ 15/2010); and Vanessa Fuhrman and Thomas Catan, “Daimler to Settle with U.S. on Bribes,” Wall Street Journal, March 24, 2010. Tim Groseclose and Jeff Milyo discuss how members of Congress value their seats in “Buying the Bums Out: What’s the Dollar Value of a Seat in Congress?” Stanford University Graduate School of Business Research Paper, 1999.

  162-165 What Culture Does: The working habits among daughters of immigrants to the United States are found in Raquel Fernandez, “Women, Work, and Culture,” NBER Working Paper, February 2007. The impact of fines in Israeli day-care centers is discussed in Uri Gneezy and Aldo Rustichini, “A Fine Is a Price,” Journal of Legal Studies, Vol. 29, No. 1, January 2000, pp. 1-17. The statistic about Japan’s high prices comes from Robert Lipsey and Birgitta Swedenborg, “Explaining Product Price Differences Across Countries,” NBER Working Paper, July 2007.

  165-168 Where Culture Comes From: Discussion of the economic implications of trust draws from Jeff Butler, Paola Giuliano, and Luigi Guiso, “The Right Amount of Trust,” CEPR Discussion Paper, September 2009; and the World Values Survey, 2005-2008 wave (www.wvsevsdb.com/wvs/WVSAnalizeSample.jsp, accessed 07/18/2010). Different views on the deformed lips of Mursi girls are from Mursi Online, Oxford University Department of International Development (www.mursi.org/); and L
uigi Guiso, Paola Sapienza, and Luigi Zingales, “Does Culture Affect Economic Outcomes?,” Journal of Economic Perspectives, Vol. 20, Spring 2006, pp. 23-48. The results of experiments using the Ultimatum Game around the world are described in Joseph Heinrich et al., “ ‘Economic Man’ in Cross-Cultural Perspective: Behavioral Experiments in 15 Small-Scale Societies,” Behavioral and Brain Sciences, Vol. 28, 2005, pp. 795-855. The use of myth to manage caribou populations among the Chisasibi is described in Fikret Berkes, Sacred Ecology, 2nd edition (New York: Routledge, 2008), pp. 128-129. Data about cultural proximity between societies that share similar environments is found in Mathias Thoenig, Nicolas Maystre, Jacques Olivier, and Thierry Verdier, “Product-Based Cultural Change: Is the Village Global?,” CEPR Discussion Paper, August 2009. The impact of the choice of economic system on the worldview of East and West Germans is drawn from Alberto Alesina and Nicola Fuchs-Schündeln, “Good-bye Lenin (or Not?): The Effect of Communism on People’s Preferences,” NBER Working Paper, October 2005.

  168-173 Who Can Afford Animal Rights?: Data on attitudes toward premarital sex are drawn from Jesús Fernández-Villaverde, Jeremy Greenwood, and Nezih Guner, “From Shame to Game in One Hundred Years: An Economic Model of the Rise in Premarital Sex and Its Destigmatization,” NBER Working Paper, January 2010; and Kaye Wellings, “Poverty or Promiscuity: Sexual Behaviour in Global Context,” London School of Hygiene and Tropical Medicine, paper presented at the Training Course in Sexual and Reproductive Health Research, Geneva, Switzerland, February 23, 2009. The reasons for England’s crummy cuisine are discussed in Paul Krugman, “Supply, Demand and English Food,” Fortune, July 1988. International comparisons of the share of income devoted to food, the price elasticity of food demand, and preferences for treating farm animals humanely are drawn from the Economic Research Service of the United States Department of Agriculture (www.ers.usda.gov/Data/InternationalFood-Demand/Index.asp?view=PEF#IFD, accessed 07/18/2010); David Dickinson and DeeVon Bailey, “Experimental Evidence on Willingness to Pay for Red Meat Traceability in the United States, Canada, the U.K. and Japan,” Journal of Agricultural and Applied Economics, Vol. 37, No. 3. December 2005, pp. 537-548; and World Values Survey, average of first four waves: 1981-2000 (www.wvsevsdb.com/wvs/WVSAnalizeSample.jsp, accessed 07/18/2010). The analysis of the relationship between the price of labor and the availability of services is in Robert Lipsey and Birgitta Swedenborg, “High-Price and Low-Price Countries: Causes and Consequences of Product Price Differences Across Countries,” University of Pennsylvania Workshop Presentation, 2008; Robert Lipsey and Birgitta Swedenborg, “Explaining Product Price Differences Across Countries,” NBER Working Paper, July 2007; and Robert Lipsey and Birgitta Swedenborg, “Wage Dispersion and Country Price Levels,” NBER Working Paper, 1997. The commentary on the different views on fairness and luck in Europe and the United States draws from Roland Benabou and Jean Tirole, “Belief in a Just World and Redistributive Politics,” NBER Working Paper, March 2005; and World Values Survey, 2005-2008 wave (http://www.wvsevsdb.com/wvs/WVSAnalizeStudy.jsp, accessed 08/09/2010). The discussion on racial diversity and support for redistributive policies draws from William Julius Wilson, When Work Disappears: The World of the New Urban Poor (New York: Vintage Books, 1997), p. 202. Data on tipping patterns in the United States come from Daniel Kahneman, Jack Knetsch, and Richard Thaler, “Fairness as a Constraint on Profit Seeking: Entitlements in the Market,” American Economic Review, Vol. 76, September 1986, pp. 728-741; and Michael Lynn, “Tipping in Restaurants and Around the Globe: An Interdisciplinary Review,” in Morris Altman, ed., Handbook of Contemporary Behavioral Economics, Foundations and Developments (Armonk, N.Y.: M .E. Sharpe Publishers, 2006), pp. 626-643.

  173-177 The Price of Repugnance: Discussion on different attitudes about eating horse fillet are drawn from Alvin Roth, “Repugnance as a Constraint on Markets,” Journal of Economic Perspectives, Vol. 21, No. 3, Summer 2007, pp. 37-58; maville.com, Caen et ça region (at www.caen.maville.com/actu/actudet_-Cyril-ouvre-une-boucherie-chevaline-boulevard-Leroy-_loc-822159_actu.htm, accessed 07/18/2010); and Tara Burghart, “Last US Horse Slaughterhouse to Close,” Huffington Post, June 29, 2007 (www.huffingtonpost.com/huff-wires/20070629/horse-slaughter/#, accessed 07/18/2010). The discussion about attitudes toward egg donations draws from the Ethics Committee of the American Society for Reproductive Medicine, “Financial Compensation of Oocyte Donors,” Fertility and Sterility, Vol. 88, No. 2, August 2007, pp. 305-309; David Tuller, “Payment Offers to Egg Donors Prompt Scrutiny,” New York Times, May 10, 2010; United Kingdom Human Fertilization and Embryology Authority, “Egg Donation and Egg Sharing” (at www.hfea.gov.uk/egg-donation-and-egg-sharing.html. , accessed 07/18/2010); and Alvin Roth, op. cit. The discussion about opposition to dwarf tossing in France comes from Alvin Roth, op. cit. Brigitte Bardot’s campaign against Koreans’ taste for dog meat is discussed in William Saletan, “Wok the Dog,” Slate, January 16, 2002. Data on kidney transplants are found in Scientific Registry of Transplant Recipients (at www.ustransplant.org/csr/current/nationalViewer.aspx?o=KI, accessed 07/18/2010). The discussion on how kidney sales would increase the supply of kidneys for transplant draws from Gary S. Becker and Julio Jorge Elías, “Introducing Incentives in the Market for Live and Cadaveric Organ Donations,” Journal of Economic Perspectives , Vol. 21, Summer 2007, pp. 3-24; Anne Griffin, “Kidneys on Demand,” British Medical Journal, Vol. 334, March 10, 2007, pp. 502-505; Ahad J. Ghods and Shekoufeh Savaj, “Iranian Model of Paid and Regulated Living-Unrelated Kidney Donation,” Clinical Journal of the American Society of Nephrology, Vol. 1, 2006, pp. 616-625; and Hassan Ibrahim, Robert Foley, LiPing Tan, Tyson Rogers, Robert Bailey, Hongfei Guo, Cynthia Gross, and Arthur Matas, “Long-Term Consequences of Kidney Donation,” New England Journal of Medicine, Vol. 360, No. 5, January 2009, pp. 459-469.

  177-178 Darwin’s Price System: The experiments about monkeys’ sense of fairness are described in Sarah Brosnan and Frans de Waal, “Monkeys Reject Unequal Pay,” Nature, Vol. 425, September 18, 2003, pp. 297-299.

  179-181 The Price of Faith: Pascal’s wager is described in Blaise Pascal, Pensées, translated by W. F. Trotter, 1910, Section IV: On the Means of Belief, paragraph 233 (at oregonstate.edu/instruct/phl302/texts/pascal/pensees-contents.html, accessed 07/18/2010).

  182-185 The Benefits of Belief: The discussion of mutual assistance patterns in religious groups draws from Eli Berman, “Sect, Subsidy and Sacrifice: An Economist’s View of Ultra-Orthodox Jews,” Quarterly Journal of Economics, Vol. 65, No. 3, 2003, pp. 905-953; David Landau, Piety and Power: The World of Jewish Fundamentalism (New York: Hill and Wang, 1992), p. 263; Buster Smith and Rodney Stark, “Religious Attendance Relates to Generosity Worldwide,” Gallup Report, September 4, 2009 (www.gallup.com/poll/122807/religious-attendance-relates-generosity-worldwide.aspx. , accessed 07/18/2010); Daniel Chen, “Club Goods and Group Identity: Evidence from Islamic Resurgence During the Indonesian Financial Crisis,” Journal of Political Economy, Vol. 118, No. 2, 2010, pp. 300-354. The discussion about the impact of religious faith on trust, moral behavior, happiness, and mortality draws from Luigi Guiso, Paola Sapienza, and Luigi Zingales, “People’s Opium? Religion and Economic Attitudes,” Journal of Monetary Economics, Vol. 50, No. 1, pp. 225-282, 2003; Azim Shariff and Ayan Norenzayan, “God Is Watching You,” Psychological Science, Vol. 18, No. 9, 2007, pp. 803-809; Steve Farkas, Jean Johnson, and Tony Foleno, “For Goodness Sake: Why So Many Want Religion to Play a Greater Role in American Life,” Public Agenda, 2001; Robert Hummer, Richard Rogers, Charles Nam, and Christopher Ellison, “Religious Involvement and U.S. Adult Mortality,” Demography, Vol. 36, No. 2, May 1999, pp. 273-285; Jonathan Gruber, “Religious Market Structure, Religious Participation, and Outcomes: Is Religion Good for You?” NBER Working Paper, May 2005; and Timothy Brown, “A Monetary Valuation of Individual Religious Behavior: The Case of Prayer,” University of California Berkeley Working Paper, September 2009. The relation between religious attitudes and people’s
opportunities in the secular world is discussed in Jonathan Gruber and Daniel Hungerman, “The Church vs. the Mall: What Happens When Religion Faces Increased Secular Competition?” NBER Working Paper, July 2006; Jonathan Gruber, “Pay or Pray? The Impact of Charitable Subsidies on Religious Attendance,” NBER Working Paper, March 2004; and Edward Glaeser and Bruce Sacerdote, “Education and Religion,” NBER Working Paper, 2001.

  185-188 What Does It Cost?: Maimonides’ comment on circumcision is found in Moses Maimonides, The Guide for the Perplexed, translated from the original Arabic text by M. Friedlander, 2nd edition (Charleston, S.C.: Forgottenbooks. com, 2008), pp. 646-647. The description of the mystic religion of Pythagoras is in Bertrand Russell, A History of Western Philosophy (London: Routledge, 1991), p. 51. The survival rates of religious versus secular communes in the nineteenth century are found in Richard Sosis and Eric Bressler, “Cooperation and Commune Longevity: A Test of the Costly Signaling Theory of Religion,” Cross-Cultural Research, Vol. 37, No. 2, May 2003, pp. 211-239.

  189-192 When Belief Is Cheap: Efforts by the religious to segregate themselves from other groups are discussed in Laurence Iannaccone, “Introduction to the Economics of Religion,” Journal of Economic Literature, Vol. 36, September 1998, pp. 1465-1496. The description of the emergence of ultra-Orthodox Judaism in Europe is drawn from Eli Berman, “Sect Subsidy and Sacrifice: An Economist’s View of Ultra-Orthodox Jews,” Quarterly Journal of Economics, Vol. 115, No. 3, August 2000, pp. 905-953. Membership in the Catholic Church is found in Carol Glatz, “Vatican: Priest Numbers Show Steady, Moderate Increase,” Catholic News Service, March 2, 2009. Time magazine’s famous God article is “Toward a Hidden God,” Time, April 8, 1966. The discussion on the weakening of the Catholic Church since the 1960s is drawn from the Association of Religion Data Archives (www.thearda.com/Denoms/D_836.asp, accessed 07/18/2010); the Pew Global Attitudes Project, “The U.S. Stands Alone in Its Embrace of Religion,” December 19, 2002; and the World Values Survey (www.wvsevsdb.com/wvs/WVSAnalizeSample.jsp, accessed 07/18/2010). Pope Benedict’s reintroduction of plenary indulgences is described in Paul Vitello, “For Catholics, Heaven Moves a Step Closer,” New York Times, February 10, 2009.