Alan Krueger, the former chairman of the president's Council of Economic Advisers, uses the music industry, from rock artists to music executives, from managers to promoters, as a way in to explain the principles of economics, and the forces shaping our economic lives.
As economists recognize, the music industry is often a leading indicator of today's economy; it is among the first to be disrupted by the latest wave of technology, and examining the ins and outs of how musicians create and sell new songs and plan concert tours offers valuable lessons for what is in store for businesses and employees in other industries that are struggling to adapt.
Drawing on interviews with leading band members, music executives, managers, promoters, and using the latest data on revenues, royalties, tour dates, and merchandise, Rockonomicstakes readers backstage to show how the music industry really works--who makes money and how much, and how the economics of the music industry has undergone a radical transformation during the last twenty years.
Before digitalization and the ability to stream music over the Internet, rock musicians made the bulk of their income from record sales. Today, income from selling songs has plummeted, even for superstars like Taylor Swift; the real money nowadays is derived from concert sales. In 2016, for example, Billy Joel earned $212.4 million from his live performances, and less than $1 million from record sales and streaming. Even Paul McCartney, who has written and recorded more number one songs than anyone in music history, today, earns 93 percent of his income from live concerts. Krueger tackles common questions: How does a song become popular? And how does a new artist break out in today's winner-take-all economy?
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Alan Krueger is the Bendheim Professor of Economics and Public Affairs at Princeton University and Research Associate at the National Bureau of Economic Research. Formerly President Barack Obama's chairman of the White House Council of Economic Advisers, he has been widely published on issues related to education, labour markets and income distribution.