| This dissertation represents an attempt to analyze the distribution of information goods, considering that they can be distributed through the Internet with very low marginal costs. Specifically, the dissertation explores an information good distributor's optimal strategy of copyright protection enforcements, a creator's distribution channel selection, and a distributor's incentive to unbundle information goods on the Internet.; We first analyze a copyright owner's incentive to enforce his or her copyright in the presence of file sharing networks. Proposing a two-period model where a copyright-owning monopolist sells two different versions of information goods, we show that the monopolist's overall profits are enhanced by a strategy of differential inter-temporal enforcement of the copyright, compared to strategies of no enforcement or full enforcement in both periods.; Next, we examine the creator's incentives to use alternative channels to distribute his or her information good. Based on a 3-stage game where the creator can choose either physical distribution or digital distribution, we find that the creator of the information good prefers digital distribution when there is (a) a high degree of substitutability between the digital good and the physical good, and (b) the creator is sufficiently effective at directly marketing his or her product. The equilibrium price of the digital good is lower than that for the physical good, while the quantity traded is greater when the creator opts for digital distribution. Social welfare is increasing in the fraction of goods distributed through digital channels.; Finally, we analyze incentives to unbundle information goods sold through the Internet. We also examine the incentive to employ mixed-bundling strategies of bundled physical goods and unbundled digital goods and show that mixed bundling is profit maximizing for the distributor. Social welfare may increase because the consumers, who do not buy physical bundles, can have positive benefits from consuming unbundled digital goods. |
