| An economic rationale exists for the promotion of music as an industry in 'developed' and 'less developed' countries alike. This rationale implies that the maximization of consumer welfare requires the existence of a diversity of musical products, with a multiplicity of audible 'voices'---including those that are local. A common programmatic response for a government, or international agency, that wishes to promote musical production in a 'developing' country, is to create a legal architecture that is similar to that which exists in countries such as the United States and Canada. This entails the creation of a functioning market for music through the transformation of musical expression into a commodity---the establishment of intellectual property rights in music. Cultural goods and services, however, do not behave like the 'textbook' commodities of economic theory. It therefore cannot be assumed that a market for musical properties will result in an optimal and efficient outcome. When applying a theoretical framework from cultural economics to a case study of the music scene in the East coast of Canada, I find that the market for music 'fails' in this respect. This implies that judicious interventions---in the form of subsidy, content regulation, and competition law---may be necessary in order to assure that a market-based system of musical production is socially and economically beneficial. It is likely that these findings can be generalized to other geographical and cultural contexts as well. |
