Copyright limitations and exceptions like fair use and fair dealing positively contribute to economic growth and innovation and are relied upon by a diverse representation of industries. Numerous studies (including but not limited to    ) continue to drive this point home, most recently with a forthcoming study, previewed this week, by the Program on Information Justice and Intellectual Property (PIJIP) that concluded “open” fair use-type laws benefit innovation, creativity, and foreign direct investment.
The study (full report on file with author), The User Rights Database: Measuring the Impact of Copyright Balance, compiled and evaluated a database of middle income and high income countries’ changes to copyright limitations and exceptions from 1970 to 2016. The report observed that the “openness” of a country’s copyright regime is positively related to economic development and creativity within the country. “Openness” refers to copyright limitations and exceptions that apply to any kind of work, by any kind of user, for any purpose. This was represented on a scale from 0-3, where a score of 0 represented that a law had no element of “openness” and a score of 3 represented that the law “clearly” had elements of “openness” (for example, a quotation right that was open for any type of user, to any work, for any purpose).
Based on the results (illustrated in the charts above taken from the report), U.S. firms operating abroad reported higher income, an increase in total sales, and an increase in value added in host countries with more “open” copyright practices. Internet services and software publishers also specifically benefitted. The data shows these industries that rely on copyright limitations and exceptions reported higher revenues in countries with more “open” limitations. A particularly illuminating data point of the report showed that a one-unit increase in the “openness” score is associated with a 50%-70% increase in revenue, even controlling for firm size, country wealth, country size, and time.