This paper uses phonebook records of music retailers in the United States for the years 1998 and 2002 to examine how Internet use, file sharing, and online sales of records have affected the entry and exit of brick and mortar music specialty retailers. By merging music store information with...

Music consumption is arguably at a historic high. File sharing technology would undoubtedly be welfare-improving provided that it did not displace music sales. Yet music purchases have decayed sharply since the introduction of file sharing a decade ago. This paper seeks to measure the effect of...