Economist Writing Every Day

One of the hardest questions in copyright policy is: “What would have happened otherwise?” When Disney lobbies for longer copyright terms or academic publishers defend high subscription fees, we struggle to evaluate their claims because we can’t observe the counterfactual. What would happen to creativity and innovation if we shortened copyright terms or lowered prices?

This is what makes Biasi and Moser’s 2021 study in the American Economic Journal: Microeconomics valuable. They examine a rare “natural experiment” from World War II – the Book Republication Program (BRP) – which provides insights into how copyright affects the spread and use of knowledge.

In 1942, the U.S. government allowed American publishers to reprint German scientific books without seeking permission from German copyright holders (though royalties were still paid to the U.S. government). This created a test case: German books suddenly became cheaper, while similar Swiss scientific books (Switzerland being neutral in the war) maintained their original copyright protection and prices.

This setup lets us answer the counterfactual question. What happens when you maintain basic royalty payments but prevent monopoly pricing? The researchers compared the same book before and after the policy change, German books versus Swiss books, areas near libraries with these books versus those without, and usage by English-speaking scientists versus others. Such comprehensive comparison groups are rarely available in copyright research.

The authors report that when book prices fell by 10%, new research citing these books increased by 40%. The benefits spread beyond elite institutions, with new research clusters emerging wherever scientists gained access to these books. This does not appear to just be shifting citations from one source to another – there was genuine new knowledge creation, evidenced by increased patents and PhD production.

Such clean natural experiments in copyright policy are rare (there are a few laboratory experiments). Most changes come from lobbying (like the “Mickey Mouse Protection Act”) or technological disruption (like music streaming), making it hard to isolate the effects of copyright itself. The BRP provides uniquely clear evidence that moderate copyright protection – rather than maximum protection – might better serve innovation.

As we debate copyright terms and academic paywalls today, this historical accident of war gives us something valuable: empirical evidence about what happens when you find a middle ground between total copyright protection and unrestricted access.

Biasi, Barbara and Petra Moser. 2021. “Effects of Copyrights on Science: Evidence from the WWII Book Republication Program.” American Economic Journal: Microeconomics, 13 (4): 218–60.